More Spending Is Not Necessarily Progressive

by: Chris Bowers

Tue Dec 30, 2008 at 06:00

Over at Daily Kos, Jed L argues that because the stimulus is large, that we have entered an era of progressive governance:

My point, of course, is that when the question is whether or not a nearly $800 billion stimulus is large enough, the outlook is pretty good for progressive governance.

Even some conservatives understand what is happening here... there is a shift underway. And you need look no further than the debate over whether $775 billion is a large enough stimulus to understand just how big that shift will be.

First, I need to point out that the stimulus isn't actually going to be $675-800 billion in new spending. Between one-quarter and one-third of the stimulus is actually a series of tax cuts (emphasis mine):

Talks over the stimulus plan, which could cost $675 billion to $850 billion, heated up over the past week as an unofficial outline emerged of what the bill would fund. About $200 billion would probably go toward middle-class tax cuts and tax credits for tuition and small businesses, while another $200 billion is under consideration to help mitigate the soaring costs of Medicaid and education. Up to $350 billion, or more, could go toward investments covering infrastructure, tax credits for renewable energy, increased funding for food stamps and the creation of an extensive technological health database.

Second, while the idea that spending increases necessarily result in more progressive governance is certainly floating around, it is a dangerous one for we Democrats and progressives to buy into. Lest we turn into a conservative parody of progressives and liberals, we need to remember that federal spending is not, in and of itself, progressive. Consider, for example, that federal spending increased more than 50% under George W. Bush, even before the Wall Street bailout. In fact, non-defense, discretionary federal spending accounted for more than half of that increase, and once again that was even before the Wall Street bailout. This massive spending increase did not yield more progressive governance, because to whom the government distributes money matters just as much as the amount of money it distributes.

More in the extended entry.

Chris Bowers :: More Spending Is Not Necessarily Progressive
I agree with Jed that we are in a moment when more progressive governance is possible, and not just because of Democratic control of the federal government. Left-wing economic ideas are more popular now than they have been in decades. Further, I also think that the bailout seems to be a positive step for the country, and its current outlines seem pretty good. However, before we proclaim a new era of progressive governance, quite a bit needs to happen. This includes, off the top of my head:

  • Make stimulus spending of this size permanent, in order to create an economy without bubbles. The one-time vs. long-term increased spending debate will be a major ideological divide in the coming years, and will be played out within both the Democratic Party and the Obama administration.

  • Labor shift toward the public sector: Lawrence Summers doesn't seem to be arguing for one in a recent op-ed. When describing the job creation goals of the stimulus, he envisions no shift toward public sector employment:

    Second, more than 80 percent of these 3 million jobs will be in the private sector, including emerging sectors such as environmental technology.

    If Summers is right, then the stimulus won't actually be shifting the labor market toward the public sector at all. In other words, there is no WPA, TVA or CCC yet. There may yet be such programs, but the fight to create them has not even begun.

  • Provide revenue sources for the two points above: The real test of the political willingness of the Democratic trifecta to institute a long-term, progressive shift in governance will be the creation of new governmental revenue streams that can pay for both long-term spending increases and an enhanced public sector jobs market. This will require doing more than just rolling back the Bush tax cuts, and will require taxation beyond that instituted under the Clinton administration.

In summary, just because the stimulus has a big dollar sign next to it does not usher in an era of progressive governance. There is still a lot of fights to be won--heck, there are still a lot of fights to be engaged. The stimulus is a decent start, but right now we still only have the possibility for an era of progressive governance, not yet the reality.  

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human capital vs. physical capital (4.00 / 3)
Spending money on traditionally male  (physical infrastructure like roads and MIC) vs. traditionally female fields (social services, health care, education) is another divide. The latter is much more progressive than the former.

They call me Clem, Clem Guttata. Come visit wild, wonderful West Virginia Blue

The real bridges to the future... (4.00 / 1)
... are in the minds of our children. They are not build of concrete and rebar.

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

[ Parent ]
I Wouldn't Mind (4.00 / 3)
I wouldn't mind the concrete and rebar of tens of thousands of foundations of wind turbines right about now. There are infrastructure projects that can set the stage for bigger and better things down the road.

Modernizing the electrical grid, investing in converting dormant manufacturing capacity over to producing wind turbines, and cornering the Big Three into producing plug-in hybrids to run off the new wind powered grid are all things that Obama can and should do in his first 100 days. They're all things that would be deeply popular if he comes out and explains them to the American people, and if he gives them a challenge to rise to. I would love nothing better than Obama standing up in his first week in office and giving a major economic policy speech from the Oval Office and lays it on the line, "We will set the goal that within ten years no less than 50% of the wind turbines and plug-in hybrid vehicles produced worldwide will come from the United States of America."

What you get from that is twofold: 1.) You save your manufacturing base, 2.) Wind turbines can be the backbone of future hydrogen based technologies because you have the clean electricity to split water molecules readily available throughout a large swath of the country.

But, you know, to do it right probably would take a much more managerial government role than the neoliberals would ever dream of taking. I've been listening to an audio book biography of FDR and I'm fascinated how he deployed the Army Corps of Engineers as the managerial backbone of a lot of the public works projects of the New Deal, like the TVA. He should do what FDR did in using the Amry Corps of Engineers as the government's managerial wing on the wind projects. Turn the right wing's "support the troops" bluster right back on them. Use the military on the home front to help rebuild our economy and shore up our national defense by switching that economy off oil.

We're ridiculously fotunate that we have the equivalent of Saudi Arabia in terms of wind power in places like Montana and the Dakotas and parts of Texas. We have a natural abundance of wind that is the envy of pretty much every country in the world. None of what I'm suggesting, in my mind, would be anything but ridiculously popular and it would nicely straddle the line between the new Green Deal and those who want to pattern the stimulus package after the old New Deal. And once you get this first set of green infrastructure projects through, it'll make the next set of green reforms that much easier. And make no mistakes about it, there will be more than one stimulus package over the next 12-18 months.  

[ Parent ]
Although (4.00 / 1)
building hospitals is more progressive than "educating" soldiers, I would think.

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3

[ Parent ]
although, if you stop "educating" soldiers (4.00 / 1)
you probably need fewer hospitals

~* the * Will * to go on *~

[ Parent ]
Friends of the Earth Campaign: New Roads = New Pollution (4.00 / 2)
Friends of the Earth has an online petition asking for no new roads in the stimulus.  New roads means more cars driven, more greenhouse gases, more sprawl, etc.  Go sign it at:

[ Parent ]
What's Progressive (4.00 / 3)
is breaking out of the knee-jerk acceptance of rightwing economic dogma--even if the conservatives never actually practiced what they preached.  The open talk about spending more--and the necessity of doing so--is a symptom of this.

But progress is only progress for so long.  You take one step, and that's fine.  But if you don't take the next step, then it stops being progress anymore.

And that's what this diary is calling for--take the next step. And the one after that. And the one after that. And the one after that.

Ultimately, we have to be asking ourselves, "What are we progressing towards?"  Which is where we get to the notion of a sustainable economy, and a sustainable society, which means growth and development that doesn't come at the expense of future generations.

If one thinks of what "conservatism" was originally supposed to mean, it is inconceivable that "sustainability" should be anathema to conservatives, and yet, of course, "sustainability" is pretty much synonymous with "socialism" to them nowadays.

It sure would be nice if Obama could wrap his mind around that one, and realize that there's a bold way forward that would honestly reach out to real conservatives as well.

And leave all this bigot-pandering BS in the dust, where it belongs.

"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3

"development that doesn't come at the expense of future generations" (0.00 / 0)
...he said without an ounce of irony while borrowing $800 Billion as part of a growing $10 Trillion+ of national debt.

~* the * Will * to go on *~

[ Parent ]
Stimulating Corporate Wealth (0.00 / 0)
This "stimulus" is simply a new and much more effective way to consolidate wealth in corporations and in wealthy pocketbooks. Yes, a small part will trickle down to middle- and working-class as well as the poor, but will make little difference. This "stimulus" is really a rightwing con game, a fraud of massive proportions. Expect the economy to keep going south as more and more is handed to the corporations and other wealthy.

Some "progressives" seem to either be fooled by the rhetoric  or complicit in this fraud.  

I sometimes wonder (4.00 / 1)
if people even understand the concept of a "stimulus" here.

A "stimulus", as it is being currently justified and applied, is designed to be temporary, to lift the economy out of its current funk. There is no presumption that any of the things that it funds will survive the need for that stimulus, anymore than the WPA survived the end of the Depression. If they do survive, it will require a major political argument to allow them to do so.

The problem is, that political argument is going to be a very hard one for Democrats to make: it will once again bring up the specter of "big government" with higher taxes -- always damaging to Democrats. The numbers that Republicans will be able to point to will be truly scary to many voters.

Does Obama have the gumption or even the desire to push such programs in the face of punishing criticism? Where in all of his history has he advocated for something for which he might take some real licks in his popularity among his current constituents (and please don't mention his opposition to the Iraq war when he was a State Senator in a very liberal district)?

In certain respects (4.00 / 1)
Obama is in a no-win scenario here.

If, two or three or four years down the line, Obama argues that the continuation of the "stimulus" is required because the economy hasn't recovered, then he's damaged by the perception that the tremendously expensive stimulus hasn't really worked. If he argues instead that the economy has recovered, and things are going fine, then he will have to justify on independent grounds the continuation of the expensive programs in the stimulus. And that will mean justifying higher taxes, or abandoning those programs, as the WPA had to be abandoned in its time.

In short, seeing the stimulus itself as being a major progressive move is pretty myopic, to say the least. If progressive policies are truly to be implemented, the piper must be paid.

[ Parent ]
He's Not in a No Win Situation (4.00 / 2)
If he gets lasting permanent infrastructure that changes the basis of the American economy. If he spends this stimulus with a view to legitimately bringing renewable energy to this country (not the dink and dunk incrementalism) and he gets a modernized electrical grid and the start of hundreds upon thousands of wind farms and he gets to conversion of dormant manufacturing capacity over to green technologies, he's gotten something lasting and important out of his investment.

If all he does is build roads and bridges, though, then yes. He's blown a big opportunity.

[ Parent ]
Teh stupid! It b-u-r-n-s! (4.00 / 2)
That would be Jed L, exemplar of "progressive" values.

Of course, lots of money is also entirely compatible with pure pork. Not saying that's what the stimulus package is, just saying that's  conclusion permitted by the depth of Jed's analysis.

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

Jeds post should be under an Onion headline (0.00 / 0)
[ Parent ]
Can someone please explain (0.00 / 0)
how it is that borrowing more and spending it is supposed to rescue an economy that is contracting because there was too much borrowing and spending? can one of the stimulus cheerleaders possibly explain this incredible idea?

~* the * Will * to go on *~

Try this (0.00 / 0)

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

[ Parent ]
Krugman has the disease too (0.00 / 0)
"insufficient demand", it's like the punch line to "pull my finger".

M1 dropped below 1 today, ask Krugman how that's working for him.

Here is debt to GDP

Everyone already has all the crappy SUVs, Plasma TVs, Condos, and chotckies they can choke on. The future is spent. Time to pay back the future. Krugman thinks this is such a blooming good idea he should be forced to buy $10K of SPY every time he blogs about how smart this stimulus is. Nattering Nabob indeed.

~* the * Will * to go on *~

[ Parent ]
I think anything that helps out (0.00 / 0)
the middle class and small business has to be considered progressive these days.


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