February 12, 2003
Stan Collender on Fiscal Policy

Stan Collender writes that the 2004 Budget's summary tables--especially Table S-3--"contradicts virtually every major claim the [Bush] administration is making about what it is proposing." Budget Battles (02/11/2003): The Secrets Of S-3 By Stan Collender NationalJournal.com Tuesday, Feb. 11, 2003 Summary Table 3, or S-3, is one of the most standard -- and basic -- tables in President Bush's budget. And it contradicts virtually every major claim the administration is making about what it is proposing. (Click here for a PDF of S-3.) OMB's own projections show that by 2006, the annual increase for interest payments on the federal debt will be larger than the increase in defense spending. S-3 starts with the baseline -- that is, the White House's estimate of the surplus or deficit if there are no changes in what the federal government is doing. Budget aficionados often say that the baseline shows what will happen if the federal government is on automatic pilot. The Office of Management and Budget-prepared baseline shows that the deficit will decline precipitously without the changes in tax and spending policies the White House is proposing. In fact, the baseline shows that the budget will be in surplus starting in 2006 and...

Posted by DeLong at 07:25 PM

February 11, 2003
When Are Deficits Supposed to Start to Suppress Spending?

Jacob Levy of the V Conspiracy asks an obvious question. If (as Mickey Kaus and others maintain) running a large federal deficit is good because it restrains spending, how come spending growth is not restrained now? We have the deficit, after all--plus the prospect of national bankruptcy a generation hence to concentrate our minds. Missing from this NYT piece about how conservatives stopped worrying and learned to love deficits: any mention of when this effect of deficits restraining spending is scheduled to kick in. The federal budget is in deficit already, boys and girls... [The Volokh Conspiracy]...

Posted by DeLong at 09:52 PM

Not Serious on Freeing-Up Trade

WASHINGTON, FEB 10--The Bush Administration's first act in its Free Trade Agreement of the Americas negotiations is to take all discussion of agricultural subsidies off the table. This is not good. To say you won't even discuss what is the major hoped-for objective of the other partners in the negotiation is a very bad negotiating strategy--or is a very bad negotiating strategy if you want an agreement. Bob Zoellick has got to know better. As the first stage in negotiations to expand free trade throughout the Western Hemisphere, the Bush administration is offering to lift all tariffs on textiles and apparel within five years. The proposal will be presented on Tuesday by Robert B. Zoellick, the United States trade representative, who prepared the offer to cover duties on everything from beef to lamps while making special concessions for the poorest nations, a senior trade official said. The goal, Mr. Zoellick said, is the eventual elimination of duties on goods and services from throughout North and South America. But the administration will refuse to discuss reducing America's multibillion-dollar agricultural subsidies in the negotiations because they are not tariffs, the senior official said....

Posted by DeLong at 04:32 PM

Let's Get Snarky!

Matthew Yglesias wins the "let's get snarky!" prize for the first quarter of 2003: 2-10-03: Tom Tomorrow goes into outrage overload. 7-24-00: Tom Tomorrow explains that there's no difference between the two parties. I for one am really glad that folks had a third option that fateful November. The dive was not too difficult--a certain fish-barrel-gun element. But the technical excellence is unsurpassable. Here are the cartoons: Now: Then:...

Posted by DeLong at 03:53 PM

Andrew Sullivan Admits Paul Krugman Was Right All Along

If Paul Krugman had written this, I would have said that it is a little harsh and over-the-top. But it's from Andrew Sullivan, who has finally woken up to the fact that Paul Krugman has been right all the time in his harsh judgments of Bush Administration economic policy: www.AndrewSullivan.com - Daily Dish: ...BUSH'S ACHILLES HEEL: It's the economy, smarty-pants... the explosive rate of current government spending... the president's utter insouciance about how to pay for it... his latest budget removes any [excuse for giving him the benefit of the doubt]... worse than Reagan... ratcheting up discretionary spending... no signs whatever of adjusting to meet the hole he and the Republican Congress are putting in the national debt... illiterate flimflam.... But as the tables in the budget also showed, the tax cuts have also contributed significantly to the deficit - and they've barely taken effect yet... staggered that the budget does not contain any mention of the looming war. I guess you could make a semantic point about its not being inevitable - but not even as a possible contingency? Is that how an ordinary citizen plans his own budget?... an awful legacy in the making. In the first three...

Posted by DeLong at 03:14 PM