August 11, 2021
In These Times
Deficit demagogy has (finally) become a fringe position in American politics—just look at the massive bills moving through Congress.
Democrats in Congress are now on the verge of enacting two huge expansions of non-defense spending, though serious challenges remain. The first is a $1.2 trillion package of infrastructure outlays, including funding for roads, bridges, rail, rural broadband and water systems, which has bipartisan support. The other is a so-called budget reconciliation bill focusing on “human infrastructure” of care work, paid leave, expansions of Medicare and other social insurance programs, projected at $3.5 trillion. Both of these bills were given the initial go ahead in the Senate this week, setting the stage for more negotiations and opening the door to their ultimate passage by both houses of Congress.
Of the trillion plus for physical infrastructure, half is covered by funds approved in previous legislation, so only about $500 billion is actually new spending. But even spread out over ten years, by historical standards (admittedly a low bar), that’s a decent bump for investment in the federal budget. Add to that the reconciliation plan, and together the packages would exceed $4 trillion — a massive expansion.
The legislation scratches many different itches for progressives, though there will surely be room for criticism once final versions are presented. What cannot be denied is that the magnitude of these initiatives greatly surpasses past expansions of the federal government. It must also be acknowledged that as far as economic doctrine is concerned, on the heels of the multi-trillion-dollar rescue and relief plans recently voted into law, a watershed has been reached: Deficit demagogy is now confined to the political fringes of both parties, rather than enthralling their leaderships. (Read more)