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Conservatives Have Ideas—Really Bad Ideas March 12, 2010

Posted by Dwight Furrow in Dwight Furrow's Posts, politics.
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Much has been made of the fact that modern conservatism seems to have run out of ideas. Aside from “tax cuts will solve every problem” and “anything Obama does is bad”, there is not much of substance to conservative politics these days. (No. The lunatic ravings of tea partiers do not count as ideas let alone ideas of substance).

So Washington conservatives have been full of praise for Wisconsin Representative Paul Ryan who has stepped up to the plate with a comprehensive budget plan based on conservative principles and designed to eliminate the deficit.

Of course, as expected from a conservative, the plan calls not only for substantial cuts in Pell Grants, support for schools, law enforcement, job training, health research, and food stamps, but draconian cuts in social security and Medicare. In fact, social security and Medicare would be effectively eliminated by his plan.

And also, as expected, Ryan’s plan calls for significant tax cuts for the wealthy. According to  Citizens for Tax Justice the richest citizens would see their tax bills go down by an average of over $200,000 while those with incomes under $100,000 would see their taxes go up by about $2,000 per year.

Most taxpayers will pay much more and receive much less.

One would think that with all that sacrifice by ordinary Americans, we might really see a dent in the deficit. But if you thought that you would be wrong.

The Center for Budget and Policy Priorities has an analysis of the plan. They conclude:

As a result of its costly new tax cuts for the wealthy, the Ryan plan would allow the federal debt to continue rising in relation to the size of the economy for at least four decades. Even in CBO’s analysis of the Ryan plan, which assumed — as Ryan’s staff specified but the Tax Policy Center has found to be incorrect — that revenues would not fall below their projected levels under current tax policies until after 2030, the federal debt would grow as a share of GDP until 2043, and the budget would not reach balance until 2063. Under the much more realistic revenue estimates that the Tax Policy Center has prepared, the budgetary outlook under the Ryan plan would be substantially worse.

 Using TPC’s new revenue estimates, we estimate that the budget deficit under the Ryan plan would reach about 7 percent of GDP and the debt would grow to 90 percent of GDP by 2020. TPC estimates that revenues under the Ryan plan would average 16.3 percent of GDP over the period from 2011 through 2020. […]

Extrapolating TPC’s revenue estimates beyond 2020 shows that the Ryan plan would fail to stem the rising tide of debt for years to come. [5] The debt would continue to grow in relation to the size of the economy for at least 40 more years — reaching over 175 percent of GDP by 2050. (See Figure 1.) Even by 2080, the debt would still equal about 100 percent of GDP.

Keep in mind that if the Republicans win back Congress, Ryan will be in charge of budget policy.

Everyone would be better off if conservatives went back to having no ideas again.

book-section-book-cover2 Dwight Furrow is author of

Reviving the Left: The Need to Restore Liberal Values in America

For political commentary by Dwight Furrow visit: www.revivingliberalism.com


Losing A Generation February 24, 2010

Posted by Dwight Furrow in Current Events, Dwight Furrow's Posts, politics.
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According to Pew Research, as of November 2009, “Only 46 percent of 16-to-24-year-olds are employed, which is the smallest share since the government began keeping track in 1948…”

Via Brian Leiter, The Atlantic lays out the disturbing long-term consequences of our current recession and the failure to provide adequate stimulus to the economy—both, by the way, the consequences of a conservative ideology that may be back in power in 2010. Who better to put out a fire than an arsonist?

[I]n fact a whole generation of young adults is likely to see its life chances permanently diminished by this recession. Lisa Kahn, an economist at Yale, has studied the impact of recessions on the lifetime earnings of young workers […] She found that, all else equal, for every one-percentage-point increase in the national unemployment rate, the starting income of new graduates fell by as much as 7 percent; the unluckiest graduates of the decade, who emerged into the teeth of the 1981–82 recession, made roughly 25 percent less in their first year than graduates who stepped into boom times.

But what’s truly remarkable is the persistence of the earnings gap. Five, 10, 15 years after graduation, after untold promotions and career changes spanning booms and busts, the unlucky graduates never closed the gap. Seventeen years after graduation, those who had entered the workforce during inhospitable times were still earning 10 percent less on average than those who had emerged into a more bountiful climate. […]

When Kahn looked more closely at the unlucky graduates at mid-career, she found some surprising characteristics. They were significantly less likely to work in professional occupations or other prestigious spheres. And they clung more tightly to their jobs: average job tenure was unusually long. People who entered the workforce during the recession “didn’t switch jobs as much, and particularly for young workers, that’s how you increase wages,” Kahn told me. This behavior may have resulted from a lingering risk aversion, born of a tough start. But a lack of opportunities may have played a larger role, she said: when you’re forced to start work in a particularly low-level job or unsexy career, it’s easy for other employers to dismiss you as having low potential. Moving up, or moving on to something different and better, becomes more difficult….

The article goes on to provide evidence that people who don’t establish themselves in the job market within two years tend to suffer long-term psychological and physical damage that continues to inhibit their careers even if they eventually find steady work, suffering from increased rates of alcoholism, depression, mortality, and apathy.

I hope things turn around before our students hit the job market.

book-section-book-cover2 Dwight Furrow is author of

Reviving the Left: The Need to Restore Liberal Values in America

For political commentary by Dwight Furrow visit: www.revivingliberalism.com