- Martin Feldstein on the Deficit Dilemma While acknowledging that
high unemployment is now the most worrisome economic fact, The Wall Street Journal contributor argues that skyrocketing national debt will soon assume this role. Even if the debt commission's proposals were heeded, it wouldn't be enough. "[The debt commission's] proposal would
still leave the national debt in 2020 at the same unprecedented level
it is today--equal to more than 60% of GDP," writes Feldstein. "With
their plan, it would take until 2035 to bring the debt-to-GDP ratio back
to the 40% level we had just two years ago." Quicker fixes are needed.
Feldstein suggests Social Security and Medicare overhauls, as well as
"scaling back the costly budget that President Obama presented earlier
this year." For a nation and world worried about U.S. debt, seeing President Obama taking a cleaver to his own budget--losing policies and programs he would certainly like to
keep--would send a strong sign that America's freespending days are
- George Will on the Fed's Dual Mandate The Federal Reserve was originally created to maintain price stability, but The Washington Post columnist says it has succumbed to political pressures in recent years. The latest round of quantitative easing is a prime example of this phenomenon. "The Fed," writes Will, "is doing what the executive branch wants done but that the legislative branch will not do--creating another stimulus." The image that the Fed is "doing the president's bidding" creates a perception problem at home and abroad. It's naive to think the Fed can continue to serve a "fundamentally political function and forever remain insulated from politics." What's needed to "rescue the Fed from the ruinous--immediately to its reputation; eventually to its independence--role as the savior of the economy" is a repeal of the "dual mandate" that it develop monetary policy that accounts for both employment and inflation.
- Jan Morris on the Decline of Whistling Whatever happened to whistling? That's the question on The Wall Street Journal contributor's lips this morning. "Although I know it can sometimes be intolerable to have a habitual siffleur in the family, forever performing 'Pedro the Fisherman,' I still mourn the decline of the whistlers." It's not so much the songs Morris misses, but the whistlers themselves. "Something cocky has left society," she muses. "The whistling errand boy, the whistling postman, the whistling housewife in her flowered apron, Pedro himself, all were expressing in their often discordant music something at once communal and defiant." It's a practice that seems ready for a comeback. After all, "whistling not only cheers up the whistler, it invites the world at large to cheer up too."
- Nicholas Kristof on America as a Banana Republic (Part II) Earlier this month, Kristof penned an article suggesting that--like many "rapacious" distant countries--the United States is now home to a dangerous level of inequality. In his follow up piece, The New York Times columnist concludes that this comparison might not be fair to those (mostly Latin American) countries he singled out. "The truth is that Latin America has matured and become more equal in recent decades, even as the distribution in the United States has become steadily more unequal," he writes. This raises a larger question: does the U.S. want to be a country where the "richest 1 percent possesses more net worth than the bottom 90 percent?" That's already the case, Kristof notes, as the top 1 percent owns 34 percent of America’s private net worth, and the bottom 90 percent owns 29 percent. If all ethical considerations are taken aside, where would tax dollars do the most to stimulate the economy? The conclusion is clear, he writes, "you get much more bang for the buck putting money in the hands of unemployed people because they will promptly spend it."
- John B. Judis on What Obama Gets Wrong About Independents "The White House blamed Democrats' 2010 defeat on the loss of independents, and to win them back, it will try to slow the growth of government, encourage a bipartisan spirit in Washington, and reform the government process by eliminating things like earmarks. But what if this analysis is wrong?" The New Republic senior editor proceeds to dissect the demographics of the independent voter, and observes that the president is focusing his energies on wooing the wrong constituents. Using Pew Research data, Judis notes that most independents don't end up voting, many can be classified as "disguised partisans" (i.e. Shadow Republicans, Shadow Democrats) and are increasingly difficult to draw an election strategy around. There is, however, an important sub-section of independents in 2010: the white working class. These voters are mostly swing voters who vote against the notion of "special interests" (whether it's big government or big business). The reason why Obama lost in 2010 was because--in absence of a left wing populism--these groups tended to affiliate with the Tea Party. If Obama freezes social spending to appease these voters, he risks "deepening the downturn." The only way to win these voters over is to get them jobs before the next election. "If he can't do that, his only recourse may be to get on his knees and pray that...a strong and buoyant recovery is about to begin," he concludes.