The Fiscal Slope Exposes Deficit Scolds as Cowards

By: Friday December 21, 2012 10:00 am

Let’s just stipulate something for the record. If the Congressional Budget Office were asked to step in and score John Boehner’s “Plan B,” it would score as an increase to the deficit by about $4.9 trillion over ten yeas. If CBO scored the Obama plan, it would score as an increase to the deficit by [...]

Obama Proud of His Fiscal Slope Offer, For Some Reason

By: Wednesday December 19, 2012 10:50 am

For some reason, liberals are agonized by the fact that a Presidential press conference about gun safety legislation devolved into questions about the fiscal slope. As if this has never happened before, or that reporters are Constitutionally obligated to stay on topic. Or that the fisal policy of the world’s largest economy shouldn’t stay in [...]

Threat of Medicare Eligibility Age Increase Recedes – For Now

By: Wednesday December 19, 2012 10:00 am

Amid all the fiscal slope machinations comes one bit of good news, at least in the near term. House Speaker John Boehner has pulled back on raising the Medicare eligibility age in this deal, although he holds it out as a possibility for the conclusion of the deal next year. This suggests that the White [...]

Learned Behavior: Obama’s Backtrack on Tax Rates, Debt Limit Empowered Republicans

By: Wednesday December 19, 2012 7:45 am

The White House announced they would veto “Plan B,” John Boehner’s gambit to pass a bill extending the Bush-era tax rtes for all earners on the first $1 million of income. And Nancy Pelosi said that Boehner had better have 218 votes for such a bill, since House Democrats won’t provide any. Of course, Boehner [...]

More on Chained CPI, the Benefit Cut for Social Security on the Table in Fiscal Slope Discussions

By: Tuesday December 18, 2012 6:45 am

First of all, this is a benefit cut of about 0.3% a year, as Dean Baker points out. He adds that “This loss would be cumulative through time so that after 10 years the cut would be roughly 3 percent, after 20 years 6 percent, and after 30 years 9 percent.” Actually if we started using chained CPI in 2002, we’d be 3.6% behind today. That’s well over $1,000 a year, and the situation grows worse over time. So the greatest impact would be on the oldest seniors, which happens to correlate with the poorest.

We Don’t Have a Deficit Problem, Cont’d

By: Monday December 17, 2012 6:59 am

Paul Krugman takes aim at something that should have been a major talking point for progressives, even if lawmakers couldn’t touch it, for the last four years. There has been a void in talking about the budget deficit in real terms, in what it’s composed of and what it really means. First of all, to [...]

Unemployment Problem, Not a Deficit Problem, Cont’d

By: Thursday December 13, 2012 12:30 pm

I touched on this yesterday, but with the release of the Federal Reserve’s economic projections, we can say just what a catastrophe the past several years of policymaking has been. Here’s Paul Krugman: What struck me is that the Fed expects the unemployment rate to be well above its long-run level even in the fourth [...]

More on Raising the Medicare Eligibility Age

By: Thursday December 13, 2012 11:04 am

Jon Chait has clarified some of his points on raising the Medicare eligibility age, and with the temperature now lowered a bit, let’s just assess his argument. I find it kind of amusing that he quotes me quoting him talking about the debt limit deal in 2011, where he said, essentially, “exchanging a series of [...]

We Have an Unemployment Problem, Not A Deficit Problem

By: Wednesday December 12, 2012 2:10 pm

The good news is that the Federal Reserve vowed to keep interest rates low until unemployment fell below 6.5%. The bad news is that they implied it would take until 2015 to get there. And it will take that long, if we continue to pull back on fiscal policy in the middle of a lukewarm [...]

Consumer Confidence Starts to Drop

By: Friday December 7, 2012 11:45 am

This chart, which plots consumer confidence against incidences of news stories about the fiscal slope, finally shows the consumer affected by the uncertainty and fear from Congressional action (or lack thereof) tanking the economy. Since the summer, the consumer has been buoyed by a number of factors, including a recovery in housing prices and incremental [...]

Jon Chait’s Miserable Endorsement of Raising the Medicare Eligibility Age

By: Friday December 7, 2012 7:04 am

Since Jon Chait has never met a concession he didn’t like, he comes out with an endorsement of raising the Medicare eligibility age as part of a long-term deficit deal. So his cover for what is universally regarded as a terrible idea surely led deficit scolds seeking to use the problem to weaken the safety [...]

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