Clinton Saves But Nixon Invests


ainvest.jpg There are jobs only the government can do or fund. So why aren't these getting done? By Max B. Sawicky

April 11, 2007 - by Max B. Sawicky

Support Pajamas Media; Visit Our Advertisers

Greetings, Pajamaheddin. I’ve signed on to do a regular column here. My homeland is MaxSpeak, You Listen!, which has been on the Pajamas blogroll since the beginning. (For this mortal sin I was delinked by Mighty Mouse Markos Moulitsas, Lord of Daily Kos.) I also post regularly at TPM Caf√©. In my day job I’m an economist at the Economic Policy Institute in Washington, D.C. I am left of center on a lot of things, but you’ve got the “Sanity Squad,” so shouldn’t the Insanity Squad get equal time? Trust me, it’ll be fun. You’re all broad-minded and unafraid to confront alien ideas, right? Of course you are.

This morning there is a story about the wave of traumatic brain injuries (TBI) suffered by U.S. soldiers in Iraq. You can survive an IED with nary a scratch but still be seriously disabled by the shock waves. Soldiers are well-protected by the latest body armor, when it is provided, and this reduces fatalities, but it means more are surviving their wounds with disabilities that may never go away. Military medicine has long experience with putting broken heads back together, but less with neurological damage. The author asserts:

“What’s baffling is the Pentagon’s failure to work with Congress to provide a steady stream of funding for research on TBIs.”

This is less baffling in context, namely the bi-partisan stagnation of public investment of all types since 1980. The nation’s “stock” of public capital - infrastructure, research and development, and ‘human capital’ (educated persons) - began growing more slowly than the economy after the 70s. It had reached its peak during the administration of Richard Nixon, the greatest social spender in U.S. history. Contrary to what you might think, non-defense spending under Clinton grew more slowly than under either Bush 41 or 43. Clinton was absorbed in deficit reduction and perhaps reined in by the Republican Congress after 1994. (The G.O.P.’s fiscal behavior after 2000 suggests they were not against spending so much as spending for which Clinton could take credit.)

In public debates about economic growth, the emphasis is always on business investment, but according to the president’s Office of Management and Budget, private capital (plant and equipment) is only about 12 percent of national wealth. Not far behind are public facilities, at eight percent of wealth - 2/3rds the size of private capital. By far the greatest contributor to the economy is educated workers.

Many types of valuable investment will not be forthcoming from the private sector. The TBI problem resembles the ‘orphan drug’ situation: those who need the product don’t have the ability to pay for it. The Feds need to make a dependable financial commitment that will encourage researchers to invest their own time in finding remedies. Even more simple would be hiring people to do the work directly.

Some will be quick to say the government can’t do anything right. How then could we expect the government to undertake the complex task of bringing peace and democracy to a horror-show like Iraq? Or deciding who lives and who dies in capital crimes? Or ascertaining the proper delineation between acceptable and unacceptable research into cloning? It’s all complicated and difficult. Somehow the nation’s economy did pretty well during the public sector’s growth spurt, from 1950 to 1980.

Partly due to ideological delusions, prospects for growth in public investment are dim. Extension of the Bush tax cuts leave deficits that are political obstacles to more investment. The new Democratic Congress has proposed minimal increases in domestic discretionary spending. Republicans are obsessed with tax cuts, and Democrats with deficit reduction. The accursed French have the Train a Grande Vitesse and our Amtrak trains have to slow down to avoid flying off the antiquated tracks. The Bush Administration responds by reducing capital investment in passenger rail, which everywhere else in the world is subsidized in one way or another by government.

Not only is it not good for the economy, it’s embarrassing.


Max B. Sawicky is an economist at the Economic Policy Institute. He has worked in the Office of State and Local Finance of the U.S. Treasury Department and the U.S. Advisory Commission on Intergovernmental Relations. He is a member of the National Board of Americans for Democratic Action and serves on the editorial advisory board of Working USA. He is a frequent contributor to TPM Cafe.

Sawicky’s page can be found at Max Speak, You Listen!

Comment DiggDigg This Delicious del.icio.us Email Print Digg PJM Home

42 Comments

1. Amy Alkon:

Who’s the art by?

Apr 11, 2007 - 8:06 am 2. ajacksonian:

Then there is the infrastructure spending that has not only been useless, but counterproductive on the part of the Federal Government. The #1 over-riding factor of the entire NOLA problem that no one is willing to address from *all* sides of the table is that the city of New Orleans is sinking. And that flood controls necessary to address a Cat 5 are so expensive and problematical because land subsides at an uneven rate and, no, Dutch ideas will not work as they need bedrock to rest on, of which you will not find for some distance under the city itself.

As a Nation we need a trans-ship port at the mouth of the Mississippi. We also need petrochemical facilities to process off-shore oil. And we have a historical city on sinking land. We could do something utterly reasonable like save the core historical districts, build a new city center inland and connect a new port to these via high-speed rail systems. But that means that we actually acknowledge that the works of man have not only *not* improved the situation but made it worse.

Thats right, all those lovely billions and tens of billions of tax dollars to ‘fix the situation’ have completely ruined the entire delta so that it is reducing in size, sediment remains entrained all the way out to the gulf and winds up on Texas beaches, and the entire affair sinks faster as the interstitial water is removed by these lovely diversion and flood control projects.

Of course we could take this lovely opportunity to examine the entire region and start doing something different there, like invest in large scale ship construction, which would be something that many metropolitan areas by the sea around the globe could use just for sheer expansion capacity for its population. But that, too, requires that we acknowledge the problem and realize that throwing good money after bad to see it sink faster is not a good idea.

And because this is a representative democracy and so much of the Federal work is proposed for this, I do suggest that We the People of the other areas of the Nation look at the actual requirements of the Nation there and address them. I would prefer infrastructure spending that actually has some long term value to it… not short-term political payoffs.

Apr 11, 2007 - 8:15 am 3. DoktorNo:

Time to say goodby to the “small government” policy?

Apr 11, 2007 - 8:34 am 4. Nobody:

“The G.O.P.’s fiscal behavior after 2000 suggests they were not against spending so much as spending for which Clinton could take credit.”

I would actually suggest that the lesson the GOP learned from Clinton is that you have to spend to stay in the game. Clinton was very effective in using every reduction in growth proposed by Republicans as evidence they didn’t care about an issue, and they were depriving children of school lunches (remember that?), etc.

That is why Bush invented his “compassionate Conservatism.” The compassionate part means that we will still spend money. The Conservatism means we will still cut taxes.

This was the lesson of Clinton: The public will always vote to give itself money from the public dole.

And it still holds true. Even worse, the Republicans realized they have to outspend the Democrats, because the media will wham them much harder on reductions in growth than they would a Democrat.

Apr 11, 2007 - 9:12 am 5. James Stephenson:

Why can’t we have both. Lower taxes and a deficit reduction.

Oh that’s right, because they like spending our money. And I see the Democrats are proposing the largest Tax increase in history.

That should help a lot of people, like me who is in Chapter 13, because I borrowed money that I should pay back, but it got away from me. Never again, but currently just about all extra income is flowing to the Chapter 13 settlement. It will be wonderful to watch the government take more money from me. hhhmmmm, I guess I can go hungry so my child can eat and if that needs to happen it will.

But you are right, deficit reduction is more important than we Americans keeping our money or decreasing the size of the Fed.

Apr 11, 2007 - 9:16 am 6. Kevin Fleming:

Re; “Somehow the nation’s economy did pretty well during the public sector’s growth spurt, from 1950 to 1980.”

Well, except for the near-economic suicide of the 1970s. But I guess we have forgotten about all that already, huh?

Apr 11, 2007 - 9:19 am 7. alan rabinowitz:

You missed the point. The reason the government isn’t spending as much on stuff only the government can do (defense, roads etc.) is because its spending so much on entitlement type stuff that was none of the government’s business in the past. This is especially true at the local level where there are school programs for pregnant girls/young mothers and their babies, but no money for aging and failing water systems.
Priorities.

Apr 11, 2007 - 9:31 am 8. Carl Pham:

Well, first and foremost, Max, you need to give a reason for the Feds investing in TBI research other than it sucks for the people with TBI if they don’t. The Federal government doesn’t have any money tree farms, you know, where they can harvest the stuff. Charity money gets taken out of stuff like research on AIDS and breast cancer. Or, if you prefer, out of the paycheck that some people need to buy food and asthma medicine for the kiddles. Furthermore, there are private foundations to which people voluntarily give that do work on TBI. You need to make the case why folks should be forced via taxes to give more money to this than they want. You need to make the case why our sense of priorities is screwed up and needs to be overridden by clever dicks like you and Uncle Sam. Good luck with that.

Secondly, the business about social spending growing faster than inflation in the 50s to 70s is smoke and ashes. The smoke part is that this is a unique period in history, the huge initial growth of the gov’t during and after WW2. You might as well think that people should continue growing as fast as they do in their first year of life, which would be ridiculous.

The ashes part is where you say nothing bad happened because of this. Uh, at the time, sure, but typically it takes a while for bad consequences (heart attacks) to follow on stupid behaviour (eating too much fat). So we need to look just a bit after the social spending spree of the 60s and early 70s. Like the late 70s, early 80s.

Remember the late 70s and early 80s, Max? Stagflation, dropping real wages and productivity, unemployment over 12%? Maybe related to that earlier spree, huh? Then along came Reagan and massive tax cuts, and, presto, ten years later the economy starts booming again. Coincidence? Be very sure of your answer, ’cause your pension depends on it.

Apr 11, 2007 - 9:35 am 9. Al:

My solution: cut women’s studies at public universities and funnel the money to the science department!

*I* am not anti-science.

Apr 11, 2007 - 9:40 am 10. Austin Mike:

I must take issue with your assertion that “Democrats (are obsessed) with deficit reduction,” as increasing the marginal tax rate as they propose to do will likely increase deficits, unless they simultaneously reduce (yes, reduce, not hold steady) government spending. See the Laffer Curve and the Reagan economy in google for examples.

Apr 11, 2007 - 9:48 am 11. Thief:

“Somehow the nation’s economy did pretty well during the public sector’s growth spurt, from 1950 to 1980.”

Yeah, that decade or so of stagflation in the 1970’s was a real boon to the U.S. economy.

Our problem is not that the government isn’t spending enough money. Our problem is that is spending too much money on things this country does not need. I think a high-speed rail system would be a good thing, and I think caring for veterans with TBI is a moral obligation. But what we’re actually getting is subsidies and pork for the well-connected. Those are not the same things.

If we seem reluctant to give government any more money, believe me, we have some good reasons.

Apr 11, 2007 - 9:55 am 12. Jeff VanBishler:

Public “investment” as you euphemistically call it is paid for with taxes collected from the public (or borrowed from same). So just how much public “investment” do you think is too much? Or do you think there could be too much of it? Where do you draw the line? If taking some money from taxpayers’ wallets to pay for public “investment” is a good thing then why not take all of it and pay for lots and lots of that wonderful “investment”?

Just a few honest questions to ponder.

Apr 11, 2007 - 10:12 am 13. Miracle Max:

A few responses, and thanks to all for reading –

Amy — I have no idea. The PJ Gods put it there.

ajacksonian — I’m no civil engineer. I do know that much wetland has been destroyed and I think it is possible to rebuild it, to the advantage of hurricane protection, the fishing industry, and the birdies. Whatever part of the city is worth protecting will require some dough. Let’s keep in mind that commercial interests are partly to blame (along with the entire local and state political establishments) for the misuse of investment funds.

Dok — the era of small government is over.

James — We could, but there is no serious interest in reducing not just spending, but the growth of spending. Tax cuts might protect you from paying for the spending we get, but our children will be paying interest on the debt incurred, including in the Bush years.

Kevin — Actually the business cycle of the 70s was not much worse than the 80s in terms of overall economic growth. Of course the high inflation and interest rates at the end were damaging, but I put them mostly due to the oil price spikes, something you can’t blame on government spending. We’re spending plenty now, but you don’t see much inflation.

alan r — In the grand scheme of the Federal budget, public investment is a modest share. Ramping it up right now would be easy. A dozen years or so in the future, it’s true that the competing demands of Social Security and much more health care will require higher taxes.

Carl P — See above re: affordability. An economic rationale for TBI investment is that it benefits more than the immediate beneficiaries. You might not be a TBI victim, but a) you might sympathize with those who are; b) you might be one in the future; and c) there could be spin-off discoveries with additional benefits. As far as forcing is concerned, we have to have some way to make decisions about taxes. You can’t have voluntary taxes.

Re: 1950 to 80 (not 70) is not so unique. It is actually a somewhat pale reflection of much bigger growth in most other advanced industrial countries. Unlike individuals, the Gov is immortal. There is no necessary cycle of positive growth followed by stasis. Re: the 70s, see oil price spikes etc. above. Reagan was a huge deficit spender. Even so, the 80s were not great compared to the 60s, 50s, or 90s.

AI — I study women whenever I can.

Austin Mike — that’s the supply-side kool-aid. For existing rates, increases would raise revenue, not lower it. Even Greg Mankiw says so.

Thief — Pork is worth criticizing, but if you mean earmarks, it’s a small portion of the budget — less than $20 billion according to your link. (The budget is closing in on three trillion now.)

Apr 11, 2007 - 10:24 am 14. kparker:

Max, it’s great to have you here.

I think there’s a huge difference between funding basic research for “orphan” constituencies like TBI, where the consituency is small and the alternative is “nothing happens”, and subsidizing huge transportation projects. In the latter case, there are lots of transportation alternatives, and simply saying “the French are doing it” doesn’t substitute for a convincing argument as to why we move funding around in that way.

For a perfect case study, see Sound Transit, which even using the proponents’ suspiciously-optimistic scenarios will consume vast amounts of money without noticable reductions in the area’s traffic congestion.

Apr 11, 2007 - 10:25 am 15. Mark Poling:

Al has a point; the author keeps talking about “educated persons” as if all education is equally beneficial to society as a whole. TBI sufferers, for instance, might benefit from a 15% increase in the number of Ph.D.’s awarded in the field of neuroscience. JDs, MBAs, and, ahem, economics degrees, not so much.

I think publicly funded research in basic science should increase; a public spending increase in general strikes me as a stupid way to go about it.

And that digression about antiquated passenger rail? That’s pretty embarrassing in its own right. The reason we don’t have bullet trains from DC to Boston is that most Americans would frankly rather drive. (Never mind whether Chicagoans or Angelinos, etc. should be asked to pay for such a thing….) And as long as we’re rich enough in the aggregate that we can afford rental cars and/or plane tickets, I think that in the aggregate we’ll look for other projects in which we will invest for national pride.

Apr 11, 2007 - 10:30 am 16. Cyber:

One thing the French do invest in much more than we do is nuclear energy. If the government really wants to do something that will improve the lives of our children and their children, they should do everything in their power to get as large a percentage as possible of our electrical power from nuclear power plants.

France can keep their high-speed rail. The USA is a lot bigger than France. We’d need lots more expensive railways than France does, and then you have to convince people to use them. Sorry but Americans here in flyover country don’t really care to subsidize an east coast economist’s daily commute.

Apr 11, 2007 - 10:40 am 17. Colin Kingsbury:

High-speed rail is the biggest piece of boomfog out there on this subject, and I say that as a resident of Boston and frequent Amtrak rider.

Want to know why those shiny Acela trains that cost some $6 billion or so to deploy make the BOS-NYC run at the same speeds that steam locomotives did before WWII? NIMBY, my friend, NIMBY.

Straightening out the rails would require obtaining massive new rights-of-way through the most costly, lawyered-up part of the country this side of the Bay Area. Heck, they can’t even get the draw bridges to stay down because 200-year-old laws give marine traffic (recreational boats, more often than not) right-of-way and the boaters are quite good at mobilizing their (99% Democrat) legislators to gore everyone elses’ oxen.

Let’s not forget that we could make the Acela beat the Delta Shuttle schedule-wise *starting tomorrow* if they ran nonstop from city center to city center like they did 50 years ago. But our Founders in their infinite wisdom gave Rhode Island two senators, and you can bet they will see to it that Providence does not lose its “high-speed” rail service. Bingo, add 15-20 minutes to the trip. Don’t forget New Haven and its congressional delegation, either- there’s another unnecessary, time -wasting stop. Forget the electricity wasted having to bring a thousand-ton train back from zero to cruising speed, it’s probably enough to run a few Litchfield county McMansions for a year.

The TGV, ICE-T, and Shinkansen trains only run at top speeds between the major city pairs like Berlin and Frankfurt. Maybe we should be investing more in our infrastructure, but we’re hardly using what we have efficiently. This is pork-barrel, rent-seeking constituent service, plain and simple.

Before you can get me on board to do a lot more of this you’re going to need to prove to me that management and results from this spending are going to be a little more rewarding. As it is, I’d call the billions spent on the Acela a pretty much complete waste of money, given that it’s all of 30-45 minutes faster than the cheap-to-maintain, run-of-the-mill diesel-electric trains it replaced. Sure has nicer bar cars, though, so hey, thanks to the rest of the country for paying for my train and my Big Dig! Come and visit sometime!

Apr 11, 2007 - 10:57 am 18. Lee A. Arnold:

Well Max, you managed to stimulate a bunch of commentsthat hit every canard in the Reaganic formulary! The Democrats are proposing the largest tax increase in history? (nonsense) — never mind the taxpayers are still paying-off Reagan’s deficits, and haven’t gotten to Dubya’s yet! The 1970’s was caused by government spending? Entitlements are the problem? The Feds have no responsibility for the TBI of soldiers? The Laffer curve is a valid theory? Never mind the total ignorance of the fact that the biggest feeders at the government trough are private corporations — by a long long shot. Never mind the circular flow of money in the economy (see http://youtube.com/watch?v=SA1f2MefsMM)

Max, you have your work cut out for you!

Apr 11, 2007 - 11:00 am 19. Bob Rogers:

“Somehow the nation’s economy did pretty well during the public sector’s growth spurt, from 1950 to 1980.”

Those who don’t remember the 1970’s are condemned to repeat them - or at least repeat their bad policy recommendations.

Apr 11, 2007 - 11:01 am 20. Steve White:

Max,

A good article (I’m pretty conservative and I agreed with a fair amount of what you said [shudder]). Thanks for coming to PJM.

As to TBI, my day job is as a NIH-funded physician scientist at a major university. There is a straight-forward solution for more TBI research — the appropriate Institute within NIH should issue an RFA (request for applications), making TBI a priority for medical research. Do that and I guarantee that university researchers will take a serious look at the problem. Like most other people, they follow the money. Do a couple RFAs and you’ll get a critical mass of investigators (and reviewers!) who will view TBI as a priority and will continue that work even after the RFA is over.

How to get NIH to make this a priority? That’s up to Congress and [shudder again] an appropriate earmark, funding the RFA. This happens frequently at NIH, and is a proper way for Congress to make clear to NIH what it considers to be the higher priorities in publicly-funded medical research.

One can debate which items should be included in increased public investment — I personally think high speed trains in a country that spans a continent is nonsense; better to invest in an SST. But your basic point about public investment is a good one.

Apr 11, 2007 - 11:08 am 21. Jay Manifold:

The average distance between any two of the ten largest US cities is 1,400 miles (source). It’s not clear that 150-mph trains are competitive with 600-mph jets in that kind of geography. Having said that, welcome to Max, who certainly sounds like he has a mind of his own.

Apr 11, 2007 - 11:10 am 22. Matt S:

Regarding the public rails, one might assume that if they are not financially self-sufficient, then the public has effectively voted against them.

After all, government subsidies are just money that used to be in consumers’ hands. Those consumers have chosen not to fund rail to a degree that allows it to survive.

To suggest that government must subsidize rail is to suggest that they know better than the citizens, who have made their preferences known.

Apr 11, 2007 - 11:10 am 23. David in NY:

I must take issue with your assertion that “Democrats (are obsessed) with deficit reduction,” as increasing the marginal tax rate as they propose to do will likely increase deficits, unless they simultaneously reduce (yes, reduce, not hold steady) government spending. See the Laffer Curve and the Reagan economy in google for examples.

You know, Austin, it’s not true, that is NOT TRUE, that raising taxes reduces revenues. In fact, it’s the obverse of the same ridiculous proposition that people call the “Laffer Curve” (because we should laugh at it, I guess), that lowering taxes raises revenues.

Even Bruce Bartlett, who invented Reagonomics admits this:

But today it is common to hear tax cutters claim, implausibly, that all tax cuts raise revenue. Last year, President Bush said, “You cut taxes and the tax revenues increase.” Senator John McCain told National Review magazine last month that “tax cuts, starting with Kennedy, as we all know, increase revenues.” Last week, Steve Forbes endorsed Rudolph Giuliani for the White House, saying, “He’s seen the results of supply-side economics firsthand - higher revenues from lower taxes.”

This is a simplification of what supply-side economics was all about, and it threatens to undermine the enormous gains that have been made in economic theory and policy over the last 30 years. Perhaps the best way of preventing that from happening is to kill the phrase “supply-side economics” and give it a decent burial.

http://www.nytimes.com/2007/04/06/opinion/06bartlett.html?_r=3&oref=slogin&oref=slogin&oref=slogin

Read the whole thing and educate yourself. At best, the Reagan tax cut folks thought at a dollar in tax cuts would cause a dollar’s loss of revenue in the short term (makes sense, no?) and over the long run, might only cause a loss of 2/3 of a dollar. The myth that tax cuts pay for themselves (or that tax raises decrease revenues!), is a myth, and nothing more.

Apr 11, 2007 - 11:31 am 24. darms:

that decade or so of stagflation in the 1970’s

Do you suppose that happened in a vacuum, or because of excessive infrastructure spending? May I remind the younger folks here of the inflation in the 60’s being used to pay for the Vietnam adventure, as well as the OPEC oil embargoes of the early seventies? Ya’ think those might have contributed at least a little to the economic problems of the 70’s? My $5 an hour wages back then would have bought a modest house yet my $22/hour today would just barely do so, at least in the real estate market where I live. (which isn’t CA or MS, either)

Apr 11, 2007 - 11:33 am 25. Dan King:

The problem is not that government is always evil, or always incompetent. It is, however, always corrupt, especially when doing things not under any market discipline.

Mr. Sawicky - could you please tell us how you will increase the size of government and not increase the degree of corruption? I think this is impossible.

Apr 11, 2007 - 11:55 am 26. David in NY:

The average distance between any two of the ten largest US cities is 1,400 miles (source). It’s not clear that 150-mph trains are competitive with 600-mph jets in that kind of geography.

Jay, I looked briefly at your source and think it underestimates the appeal of fast trains. First off, the “average” distance you use misses the point — no one is proposing replacing the Boston - S.F. air route of over 3000 miles with train. But take the whole northeast, that is eveything between from NY to Chicago and Boston to Atlanta, about 900 miles on either axis. The French are doing 200 mph trains and testing those that go 300 mph. That puts the most distant cities along those axes within 4 1/2 (maybe someday 3) hours from one another. If one accepts the two-hour handicap that your source gives trains, that puts them pretty even with planes, even on the longer routes. On the short hauls, trains win hands down.

Apr 11, 2007 - 11:58 am 27. Miracle Max:

Second try posting these. I’ll try and catch up with the new comments, and thanks to all for reading –

Amy — I have no idea. The PJ Gods put it there.

ajacksonian — I’m no civil engineer. I do know that much wetland has been destroyed and I think it is possible to rebuild it, to the advantage of hurricane protection, the fishing industry, and the birdies. Whatever part of the city is worth protecting will require some dough. Let’s keep in mind that commercial interests are partly to blame (along with the entire local and state political establishments) for the misuse of investment funds.

Dok — the era of small government is over.

James — We could, but there is no serious interest in reducing not just spending, but the growth of spending. Tax cuts might protect you from paying for the spending we get, but our children will be paying interest on the debt incurred in the Bush years.

Kevin — Actually the business cycle of the 70s was not much worse than the 80s in terms of overall economic growth. Of course the high inflation and interest rates at the end were damaging, but I put them mostly due to the oil price spikes, something you can’t blame on government spending.

alan r — In the grand scheme of the Federal budget, public investment is a modest share. Ramping it up right now would be easy. A dozen years or so in the future, it’s true that the competing demands of Social Security and much more health care will require higher taxes.

Carl P — See above re: affordability. An economic rationale for TBI investment is that it benefits more than the immediate beneficiaries. You might not be a TBI victim, but a) you might sympathize with those who are; b) you might be one in the future; and c) there could be spin-off discoveries with additional benefits. As far as forcing is concerned, we have to have some way to make decisions about taxes. You can’t have voluntary taxes.

Re: 1950 to 80 (not 70) is not so unique. It is actually a somewhat pale reflection of much bigger growth in most other advanced industrial countries. Unlike individuals, the Gov is immortal. There is no necessary cycle of positive growth followed by stasis. Re: the 70s, see oil price spikes etc. above. Reagan was a huge deficit spender. Even so, the 80s were not great compared to the 60s, 50s, or 90s.

AI — I study women whenever I can.

Austin Mike — that’s the supply-side kool-aid. For existing rates, increases would raise revenue, not lower it. Even Greg Mankiw says so.

Thief — Pork is worth criticizing, but if you mean earmarks, it’s a small portion of the budget — less than $20 billion according to your link. (The budget is closing in on three trillion now.)

Apr 11, 2007 - 12:00 pm 28. Miracle Max:

More responses. (The preoccupation in the comments on trains is striking.)

Jeff VB — Whatever too much is, IMO we are way short of it. Obviously anything can be taken too far. The U.S. public sector (Federal, state and local) is among the smallest among OECD nations, so in that sense there’s a lot of room for expansion.

kparker — thank ‘ye, darlin. It’s true better passenger rail might not reduce congestion, but that would mean more people are driving and possibly accomplish something in the process, whether for business or pleasure.

Mark P — I do not support a public spending increase “in general.” How the decisions are made is very important. Maybe next week we’ll have a public administration seminar. I’ve got a few ideas about that too. As for preferring to drive, I make the drive up I-95 from D.C. to NYC several times a year, and nothing would please me more than avoiding it. Regarding who should pay, we all pay for stuff benefitting people in far-away states.

Cyber — Check the Amtrak station list sometime.

Colin — So you’re saying we should junk federalism and be more like France? :-)
Lee — we’re workin hard.

Bob — you and your colleagues have provoked me to do my next piece on the misunderstood 70s.

Steve — a lot of earmarks make perfectly good sense. You could argue there’s a better way to make those decisions. Rail is not economical for 3,000 miles trips. But the time advantage for shorter trips that people often fly is obvious.

Jay — don’t forget the time getting from your home into a plane that is taking off.

Matt S — the idea of a public good is that the benefits go beyond the literal customer. If they don’t, then that rationale does not apply. Others might.

darms — just so.

Apr 11, 2007 - 12:24 pm 29. DoktorNo:

A though: here in Europe the governments are “big”, bacause they are spending huge amount of monies for welfare, the public health or state-owned indrusties. Meanwhile the European Union is trying to persuade the member states to be more disciplined in maintaining the small budgetary deficit. So the states schould think twice about the government spending, and reform the public financies, or face some consequences, like penal payments.

The Europe is trying to boost its economy by some neoliberal reforms (”Agenda 2000″, Stability and Growth Pact etc.), in order to not fall behind USA and Asia. I am not fan of pure neoliberal economic thought, but I am also aware, that some of spendings in EU level and member states are just absurd, e.g. the Common Agriculture Policy, which is consuming ~60% of EU budged.

BTW: the terms “conservative” and “liberal” are a bit differend here. For example in my country, Poland, we have two mayor conservative, right-winged parties (one in power, one on opposition). The first one is more “etatistic”, and the second one is more “liberal” (=pro free market). Currently the government is constantly under fire for slow implementation of reform of public financies (a step needed for the participation in Eurozone).

Apr 11, 2007 - 1:41 pm 30. Matt:

Supply-side, Democrat style. Build public infrastructure. Imagine if the Congress allowed contracters to pay non-union scale wages. They could easily expand airports, the interstate highway system, and spread fiber backed wi-fi across America. The only problem is, according to current unemployment rates, they’d have to hire half of Mexico to do the work.

Apr 11, 2007 - 1:54 pm 31. Greg D:

Of course there are lots of comments on rail, it’s a hot button for both sides. You lefties want to see us become “more European”, and so push rail / mass transit systems on the rest of us. We righties understand that you give subsidies only to things that aren’t worth doing (because if they were worth doing, you wouldn’t need to subsidize it, it would pay for itself).

Given a chance to ride in my car, listening to my music, and operating on my schedule, v. riding on government mas transit, listening to the “music” of whatever jerk decides to inflict on the rest of us, being forced to interact w/ lots of people I don’t know, don’t care about, and don’t want to interact with, and doing it on someone else’s schedule, I chose my car.

It’s the choice of freedom, which is why you lefties hate it so much.

As for trains v. planes: unsubsidized planes cost less than subsidized trains. The planes are faster, and don’t require many rights of way. Go planes.

Apr 11, 2007 - 2:43 pm 32. John Costello:

We righties understand that you give subsidies only to things that aren’t worth doing (because if they were worth doing, you wouldn’t need to subsidize it, it would pay for itself).

Which is why Eisenhower decided to fund the interstate system through private investment alone!

Apr 11, 2007 - 2:57 pm 33. Gar Lipow:

Unsubsidized planes? Where do you think airports and airport rights of way come from? Why do planes not pay the same fuel taxes as cars, trucks and even trains?

Apr 11, 2007 - 3:08 pm 34. Colin Kingsbury:

I think what people mostly want is competence. People sense, rightly, that absent the clarifying forces of profit and loss, government-funded projects naturally turn into boondoggles. There are a host of reasons why the Big Dig tuned from a $2bn project into a $15bn one, but the largest reason was the simple fact that *it could*. Private-sector developments that do the same thing tend to go bust or get reined in far sooner.

How many New Orleans pols or ACE generals have lost their jobs over shoddy engineering and building practices? The Code of Hammurabi had more accountability for builders than we do these days.

If you look at all the great mega-projects of the 20th century (Panama Canal, Manhattan Project, Polio vaccine, Interstates, Apollo), they were all in a sense crash programs motivated by a sense of crisis and urgency, usually driven by one charismatic leader. This provided a sense of discipline and limited the political interference.

I for one have no doubt that if some astronomer tomorrow discovered a killer asteroid headed for us in 10 years’ time, that NASA could be counted on to figure out a way to save our sorry hides. However, at the moment they are being outperformed by a bunch of wildcatters working out of cheap rented hangars all over the high desert who probably spend less on R&D than NASA spends on sensitivity training or something else that has nothing to do with sending giant phallic symbols skywards. Hell, first thing they’d probably do is hire Burt Rutan and give him a few billion dollars and carte blanche on how to spend it.

Government’s strength is its ability to mass resources at a nearly unthinkable scale, but its weakness is to fritter them away. Even the Japanese can’t build public works without half the money ending up in the hands of the mob.

Apr 11, 2007 - 6:15 pm 35. Drew:

Congress fails to fund research into TBI? Of course they do. Can’t have those returning Grunts possessing better working brains than their “leaders/betters” on the Hill.

Apr 11, 2007 - 7:38 pm 36. peter jackson:

The railroads really are a special case. They’ve been operating in their own little protected universe provided by the Federal government since the days of the robber barons. And as a result, there it stayed, mired in the 19th century, much like Soviet agriculture until its liberalization. Maybe if we stopped trying to produce rail service and education like the Soviets tried to produce food, we’d get a different, better result.

yours/
peter.

Apr 11, 2007 - 8:49 pm 37. Paul from Florida:

Nice.

Lefty uses brain damaged, non lefty soldiers to get money for his union friends and favorite eurolefty projects. What, the phrase, ‘for the children’, or ‘for the elderly’ doesn’t work anymore?

If you want to help crippled soldiers, ensure they and their family and friends live in a country where working people keep most of their money, take care of their wounded and don’t have to work like dogs to pay taxes to each and every PhD, lefty profiting boondoggle.

Apr 12, 2007 - 4:43 am 38. syn:

Oh goody, upholding Europe’s road to serfdom as an ideal economic foundation will do well for the Collective desire to establish an Infantilized Nation of Useful Idiots.

Considering the American government spends only 3.9% of the GNP on our military perhaps the entitlement narcissism of Collective baby boomers will sacrifice a little of their selfish ways by ending their mantra:

‘government stay out of our bedrooms but give us free health care, free transportation, free education, free housing, free food and do it without one sacrifice on our part.’

My dream would be to end the anti-pluralistic practice of dreaded Ivory Tower Tenure to stop their magic bus from driving us all down the road to serfdom.

THe divide in America is not between red state/blue state, the division is between Collectivism and Individualism.

Apr 12, 2007 - 5:54 am 39. tibblets:

Europe’s ‘road to serfdom’, and the tyranny of ‘lefty’ professors driving you down it. Oh dear.

Apr 12, 2007 - 7:11 am 40. Miracle Max:

Gee, where’s the love . . .

Peter J — right now the problems include no funding for capital improvements, though as others have noted rights of way and NIMBY matter as well.

Paul — all the tax cuts in the world won’t help a family find a cure for TBI. If you think TBI research would be a boondoggle, we’ll just have to agree to disagree.

syn — Nothing from the Gov comes free. Chances are I would pay much more for any of it than most people.

N.B. I am not a professor and I have no tenure anywhere. I do belong to a trade union.

I wonder how all you individualists feel about many of us being forced to pay taxes for wars we don’t like?

Apr 12, 2007 - 9:01 am 41. Paul from Florida:

Miracle Max,

When private Americans or the government, or anyone in the world, finds a cure for even migraines, then we will talk. Then sick delusion that the bureaucracy of government, that can not even run trains, that has spent T as in trillions of taxed dollars on slum clearance then urban renewal, then model cities, could pick the winner in medical brain research is so stupid, based upon record, as to be criminal.

By the way, I’m an ex Special Forces (Company A, 1st Bn, 7th SFG) medic. You take the Kings coin, you do the Kings bidding. I have a little rubber meets the road philosophy in life, but that is because I have and do pay for it. I don’t live off the point of a gun-money, taken off of the working class that has half of each years worth of labor stolen to scum lefties so that they and theirs can live easy. You want to be a hero, be old school and find a cure. You’ll be well paid. Otherwise find another sucker.

Apr 12, 2007 - 11:57 am 42. David in NY:

Paul,

I think you are not aware of the enormous advances in medicine, and in other important areas, secured by government funding of research which is usually conducted at our great universities. Here’s a small sample of what’s been achieved at a single university, largely using government funds:

After World War II, a spectacular growth in federal grants to universities flowed from a bipartisan recognition that strengthening campus research was essential to the national interest. Earlier breakthroughs at Columbia, such as the discovery of Vitamin B-1, laser technology for eye disease, and the invention of FM radio, were among the compelling reasons for Washington’s commitment to nurture future innovation. The decision to support the research enterprise was a wise one. It led to a host of applications nationwide, including the development of the Salk polio vaccine and the design of the first digital computer, and, more recently here at Columbia, the successful end of a 20-year search for an infectious agent responsible for Kaposi’s sarcoma, the cancer common among victims of AIDS.

http://www.columbia.edu/cu/president/report96/research.html

Government funding of research on TBI stands a good chance of being successful, and success won’t happen any other way. The profit-driven private sector is simply unwilling to put much money into research on a problem that does not affect millions of people, and thus that is not going to produce big profits in the future. That’s why government is important.

What’s your problem with this? This isn’t a question of some scam to let lefties live easy — it has nothing to do with lefties. It does have something to do with the correct liberal understanding that the government does a number of important things better than anybody else does — and providing funding for important medical research is one of those things.

Apr 12, 2007 - 7:57 pm

Write a Comment

Name: (required, displayed)
Email: (required, not publicized)
URL: (optional, displayed)
remember personal info?
Comments: