And he brilliantly summed up the reality that is eluding the negotiating parties in Washington: "an extra percent a year on the growth rate for the next five years will do more for the budget than any amount of the entitlement-cutting that's under discussion." As Summers explained on Charlie Rose, every new dollar of GDP takes 25 to 30 cents out of the deficit in year one. And yet that simple economic truth does not appear to be included in the "everything" that Obama claims is "on the table."
"It is crazy if you think about it," Summers told Isaacson, "that we have schools across this country where we tell our kids that education is the most important thing in the world, but we ask them to study in classrooms where the paint is chipping off the walls."
"I'd rather see us focus on the jobs deficit," said Summers. "I'd rather see us focus on the public investment deficit. I'd rather see us focus on the human capital deficit. Those are deficits that we need to focus on also."
Why do people have to leave office before they can unambiguously and unequivocally speak the truth?
As Peter Orszag, now also no longer in office, wrote for Bloomberg View, a sluggish-growth scenario would add $2.5 trillion to the debt by 2021, more than the $2 trillion in cuts being discussed in the debt-ceiling package.
And a way to ensure the sluggish scenario is to do exactly what they're doing in Washington right now. "I only ask... as Congress looks at the timing and composition of its changes to the budget," said Ben Bernanke to the Senate Banking Committee, "that it does take into account that in the very near term the recovery is still rather fragile, and that sharp and excessive cuts in the very short term would be potentially damaging to that recovery."
So why aren't we focusing on jobs and growth? Summers' admirably candid answer to Charlie Rose: because "those without jobs aren't in a position to contribute to political campaigns, and to a disproportionate extent are the people who don't vote."
But it's not like the circus that's rolled into Washington is particularly popular with the people who do vote, either. In the latest Gallup poll, only 16 percent said the deficit was the most important problem facing the country today. Almost twice as many said it was jobs, and more still said it was the economy in general.
Is it any wonder that people have lost trust in the political system and that the vast majority of Americans think we're on the wrong track?
In the meantime, the president is engaging in the cosmetic populism of ending tax loopholes for corporate jets (which he mentioned not once but twice during his White House presser last Friday). I'm all for ending tax breaks for corporate jets, but what we need is not small-time symbolic gestures, but the tools to -- as this president put it not so long ago -- "win the future."
Instead of winning the future, Obama is facing two bad choices: a short-term debt-ceiling extension or going into default (unless he's willing, which he doesn't appear to be, to invoke the 14th Amendment).
So why did Obama go along with the idea that a long-term budget agreement should be tied to the debt ceiling increase instead of using all that time, his bully pulpit, and his considerable rhetorical skills to make the case to the American people that our long-term deficit crisis should be solved with the most powerful means available: a growing economy that puts people to work?
By wanting to be the only reasonable guy in the room, Obama is now facing two very unreasonable choices. And it was all entirely unnecessary. Regardless of who scores a political win as a result of this game of debt ceiling chicken, America is the real loser.
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