New Agenda for America: Emergency Checklist
Thursday, 10/29/2009 - 12:35 pm by Jeff Madrick | One Comment
To mark the 80th Anniversary of the Great Crash of ‘29, we asked 15 progressive thinkers to write about lessons learned and what lies ahead. Together, their reflections constitute a New Agenda for America — a message of how the ideals of a fair society should apply to the economic and social policies of our time.
We have lost a generation in America to a simple ideology that government is at best a necessary evil whose influence is to be minimized. Going forward, there is much to do: reform healthcare; re-regulate finance; build a universal pre-k system; build a light rail and public transportation system; radically reduce carbon emissions, create a sensible Bretton Woods III.
Once we are well out of the woods of the crisis, here is where I would begin: raise income taxes. America’s government must lead us back to the path of excellence and global competitiveness. The nation must invest in its healthcare, education, and infrastructure. It must subsidize new industries, new technologies. It must reinvigorate manufacturing. It must expand radically its safety net to protect those who lose jobs and even careers. It must borrow less from overseas to do all this.
We can raise taxes by 3 to 5 percent of GDP, thus generating $450 billion to $750 billion of money to invest infest in the future. That is enough money to get the job done and it would still leave government spending in America at all levels below 40 percent of GDP-and below most of what the rest of the rich world spends. Would it impede growth? No way. Not if invested properly. It hasn’t overseas, and it won’t here.
If we do not find the will to do these things, growth will be impeded. Here is a cliché that is true: The nation’s future is at stake. This is an emergency. Sound the sirens.
Roosevelt Institute Braintruster Jeff Madrick is fellow at the Schwartz Center for Economic Policy Analysis, The New School.
Madrick’s book The Case for Big Government amplifies this very brief prescription. He advocates spending an additional $432 billion a year on social benefits, raising federal spending from 21% of GDP to 24%. Most European nations spend from 50% to 100% more of GDP on social benefits. In the U.S. we spend 13% on social benefits, an amount I think we’ve kept constant for many decades. My local library in San Leandro ordered this book today, by my request, so in a sense I just bought his book. I read the Berkeley Public Library issue. Ask your library to do the same.
Posted by Ben Leet | December 11th, 2009 at 11:02 pm