E’ un tema che non voglio perdere di vista. Ho cominciato ieri qui, con una riflessione più generale e teorica. Oggi incollo la mail giornaliera di The Progress Report, come sempre ricca di rinvii. Ma vorrei aggiungere altro.
Yesterday, President Obama sent Congress his record setting $3.8 trillion budget plan aimed at tackling the nation’s high unemployment, bolstering the middle class, increasing education spending, initiating measures to rein in the federal deficit, giving “tax credits for hiring,” and providing “new investments in green jobs and infrastructure projects.” However, the federal deficit is expected to reach $1.56 trillion this year while dropping slightly to $1.3 trillion in 2011, “forcing the government to borrow 33 cents of every dollar it spends.” At the same time, the plan contains nearly $3 00 billion devoted to “temporary recovery measures,” including $100 billion for middle class tax cuts and jobs. The budget also includes $184 billion in stimulus spending in 2011 and 2012. “I think it’s very important to understand,” Obama said. “We won’t be able to bring down this deficit overnight, given that the recovery is still taking hold and families across the country still need help. We will continue, for example, to do what it takes to create jobs.” The White House expects the jobless rate to fall slightly to 9.8 percent by the end of the year and to hover at 8 percent by 2012.
BOOST IN EDUCATION SPENDING: Yesterday in an interview that aired exclusively on YouTube, the President argued that education and a strong economy are interrelated. “I think obviously there’s a huge economic component to being well educated. We know that if you’ve got a college education, you are going to make multiples of what you would make as a high school graduate, much less a high school dropout over the course of a lifetime,” Obama said. Indeed, Organization for Economic Co-operation and Development studies have found that a college educated male earns nearly $400,000 more over a lifetime than one who does not attend college and a small jump in student achievement could translate int o an estimated economic benefit of $40 billion in GDP by 2090. As such, the President’s budget calls for a 9.7 percent increase ($3 billion) in funding for the Education Department. The budget also advocates important education reforms, such as investing in low-performing schools, improving teacher quality, aiding states with pressing needs, and investing in innovation (including an additional $1.35 billion for the Race to the Top Fund). As Center for American Progress Action Fund Senior Fellow Ulrich Boser noted, “The administration’s budget goes a long way to improve our nation’s education system — and provides a much needed investment in our economic future.”
THE NAGGING DEFICIT: Republicans have been hypocritically attacking Obama for the budget deficit, most of which was created by President Bush. Obama recognizes “that the problem has to be made worse, with intense deficit spending to lower the unemployment rate, before the deficits can come down.” The budget does, however, contain significa nt measures to reduce the deficit over the long term, including imposing new fees on the nation’s largest banks, freezing non-security spending for three years, eliminating fossil fuel subsidies, and allowing the Bush tax cuts to expire on those making over $250,000. But if Obama is truly serious about taking on the deficit, the administration cannot exempt defense spending from the planned spending freeze. In fact, this year’s deficit will match 11 percent of the nation’s entire economic output, a level not seen since World War II. However, in the administration’s budget, medium-term deficits stabilize in the range of 3.9 percent of GDP. Acknowledging the budget’s red ink, a New York Times editorial noted yesterday that “it is not too much at a time of economic weakness, when deficit spending is needed to boost growth. … Congress also cannot waste any more time posturing about the deficit rather than doing what is needed to get Americans back to work.”
GETTING TO ‘PRIMARY BALANCE’: The Obama administration is taking other steps to tackle the deficit problem. Last week, the Senate rejected a proposal to create a deficit-reduction task force “after seven Republicans switched positions and voted against it.” Sen. George Voinovich (R-OH) chastised his colleagues for voting against the plan, calling their claims that it would be stacked in favor of tax increases “disingenuous.” Now, the President will create the panel though executive order with a “medium-term and a long-term objective” of reducing the deficit. The first goal would be to find a path toward “primary balance” — when revenues and program spending equal each other — by 2015. This plan closely mirrors a Center for American Progress plan for fiscal balance, which calls for a “primary balance” by 2014 and full balance by 2020. Primary balance, if achieved, would stabilize the debt-to-GDP ratio at an acceptable level and lay the groundwork for full budget balance. “It is clear with all of these changes that the administration is taking deficit reduction seriously< /a>,” CAP Vice President for Economic Policy Michael Ettlinger said, adding that Obama’s budget “shows a commitment to getting the job market back in shape and to make the investments needed for long-term economic growth. It is these investments that are the real story of the budget.”