A Budget for the People?

The core purpose of federal taxing and spending is to provide the American people with the government services and public goods they need, want, and deserve. The new administration’s budget, if we can even call it that, does nothing of the sort. Plenty of journalists have covered the budget (see here, here, and here for a few examples), but who is offering an alternative budget with a bold vision to serve the people?

Let’s be honest, Democrats are only offering neoliberal tweaks to the system, far from reshaping our highly unequal and unjust society. Democrats have been offering working Americans an incomplete deal — arguing for marginal change when large-scale structural reform is needed, and pushing “free trade” deals, which protect corporations at the expense of workers, while only providing workers with a weak handout rather than ensuring they have a path to a viable career.

An alternative must be offered.

In the short term, alliances must be built to resist the Republican budget agenda which will further erode the well-being of the majority of Americans, especially those who are most vulnerable. In the medium term, an alternative to Trump’s agenda is desperately needed, including a large-scale jobs program to reach all Americans willing and able to work. Finally, in the long run, policymakers should develop bold ideas, including an Economic Bill of Rights, ensuring the U.S. government eliminates poverty and unemployment for all — bringing shared prosperity to American households by building a just, inclusive, and democratic economy.

A budget must reflect a vision of the nation’s fiscal and economic needs. While some argue the U.S. may need more tax revenue, raising revenue is the responsibility of the Administration in power and its congressional allies. In any case, so long as there are millions of unemployed and underemployed Americans, there should be no call for balancing the Federal budget and policymakers should resist any attempt to cut social spending in the name of budget balance. And if history is any guide, we know the best way to balance a budget is through achieving full employment.

In the short run, resist

Speaker Paul Ryan has suggested that a tax overhaul will be one of the first priorities on the GOP agenda, suggesting Republicans would use the budget reconciliation process to advance their aims. While Speaker Ryan’s “A Better Way” and Donald Trump’s “populist” economic agenda differ in important ways, either would further erode the well-being of most Americans and further support a crony capitalist system that Americans must flatly reject. If either Ryan or Trump’s agenda for fiscal policy moves forward, the debt will soar, the fat cats will get fatter, and the economy will fall more steeply into the trap of secular stagnation.

For now:

● Reveal trickle-down economics for what it is — pure nonsense. The major tax cuts proposed by the Republican leadership will not lead to surges in economic growth, rather they will lead to a long term fiscal crisis that may force the hand of the government to cut vital social insurance programs. Further, they will exacerbate the already unacceptable levels of inequality that plague the country and are hindering economic growth.

● Resist gutting the Affordable Care Act. First, the Republican healthcare plan will cost tens of thousands of lives per year. This is a matter of life and death. Period. Healthcare should be a right, and anything impeding on realizing that right must be stopped. Further, the Republican plan threatens the viability of the private health insurance market for all privately insured Americans. Stealing insurance from hard working Americans to give further kickbacks to the rich is plain wrong.

● Resist further cuts and privatization to Medicare, Medicaid, CHIP, Social Security, SNAP, and other social insurance programs which violate Trump’s promise not to hurt the needy. Block grants, such as those proposed in Ryan’s previous budget, will force state governments to make impossible choices between health care and other vital services.

● Oppose Trump’s infrastructure plan. This plan is shaping up to be crony capitalism at its worst. While some Democrats have said they are willing to work with Trump on a large-scale infrastructure bill, we must flat out reject it in its current form. Trump’s infrastructure program is to be financed by private entities that will be rewarded with tax breaks to the tune of $137 billion and control over tolls and fees on infrastructure projects to be subsidized by taxpayers. Under the Trump plan, current infrastructure projects that would be built anyway would be subsidized, and projects that maximize private profits, not the social good, will be pursued. Necessary infrastructure projects to support the economy and health of the country will be ignored because they are unattractive to private investors; large social benefits from rebuilding our water infrastructure, to repairing roads, to massive investment in green technology will be left out.

A well-designed jobs program for the medium run

People don’t want a handout; they want a job. Nevertheless, the private sector continues to leave millions without work, even during supposed “strong” economic times.[1] Fighting for a higher minimum wage is an important step to ensure that workers are compensated a living wage rather than a poverty wage, yet let us not forget that the effective minimum wage in this country is $0. This must change. A large-scale jobs bill, such as a Green New Deal with a WPA-type jobs program, is necessary. The jobs bill can be part of a medium-term progressive budget proposal that borrows heavily from The People’s Budget, and puts Americans back to work — especially those in the middle of the country — building a truly inclusive economy.

No amount of hard work nor “pull yourself up by your own bootstraps” drive can overcome the shortage of jobs available to many Americans — especially those in post-industrial regions and groups subjected continuously to higher odds of joblessness, such as ex-offenders, recent military veterans, and racial/ethnic groups who experience discrimination. A jobs program, offering wages at non-poverty levels, would reach many Americans currently left behind by the uneven economic growth of modern times. Under such a program, the country could rebuild our crumbling infrastructure. Rather than relying on private profits to motivate public projects, the country could undertake projects that address our social, economic, and environmental needs.

Building a progressive budget: An Economic Bill of Rights for the 21st Century

In his State of the Union address in 1944, Franklin Roosevelt called for an expanded Bill of Rights recognizing economic rights. “Necessitous men,” Roosevelt observes, “are not free men.” Those “who are hungry and out of a job are the stuff of which dictatorships are made.” Moreover, real freedom, freedom to “pursue happiness,” requires a “second Bill of Rights under which a new basis of security and prosperity can be established for all.” For Roosevelt, full citizenship requires more than the political rights enshrined in the original American Bill of Rights, it requires economic rights. For Roosevelt, these included:

1. The right to a useful and renumerative job in the industries or shops or farms or mines of the nation.

2. The right to earn enough to provide adequate food and clothing and recreation.

3. The right of every family to a decent home.

4. The right to adequate medical care and the opportunity to achieve and enjoy good health.

5. The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment.

6. The right to a good education.

Roosevelt died before he could bring economic rights into the American Constitution but others continued his campaign for economic rights. Seeking to extend the Civil Rights movement, A. Phillip Randolph, Bayard Rustin, and the New Deal economist Leon Keyserling drafted “Freedom budgets” recognizing that poverty remained a great barrier to Americans’ freedom. Following in their footsteps, progressives must put forth a bold vision that would fundamentally reshape our economy and meet the basic needs of all Americans.

No longer can we accepting the redlining of opportunity in this country.

[1] For instance, since 1972 unemployment has averaged double digits for black workers and has never fallen below 7 percent — a level that is only reached during times of economic crisis for white workers.