National Infrastructure Bank vs PAYGO
By John Ascher
Jan. 6, 2018–A group of Progressive Democrats this past week challenged Speaker Nancy Pelosi and the Democratic establishment on one issue which counts: their decision to reassert the House version of PAYGO. (Pay-as-you-go.) They lost the challenge, but have raised an important debate.
The Progressives were absolutely right in making the challenge and opposing PAYGO. (You can see one useful statement as to why by California Democratic Rep. Ro Khanna here.)
PAYGO is the 1990 vintage version of “balancing the budget,” which actually goes back to Virginia Senator Harry Byrd’s “pay-as-you-go”, and his opposition to the New Deal measures of FDR.
PAYGO allows the President, at the end of the year, to impose across-the-board cuts, if the new measures which were passed were not “revenue neutral.” The current Democratic leadership does not want to leave that cutting authority to Donald Trump, so they want to “right” to determine the cuts themselves, thus avoiding the inevitable Republican charge of being “tax and spend” liberals.
The Democrats, of course, point out that it has been the Republicans who have been the most irresponsible, as demonstrated by their recent version of PAYGO, called CUTGO. That exempted the recent Federal Tax cuts from any scrutiny, based upon the theory that increasing the wealth of the upper income earners and corporations, will expand the economy.
Without confusing anyone with a further account of the sparring on this issue, let’s cut to the chase.
We need a massive infrastructure expenditure, as outlined in the proposed National Infrastructure Bank (NIB). That bill is gaining momentum throughout the country.
This type of driver for the economy, particularly when it includes installing new technologies like Fusion Energy, create a multiplier effect in the physical economy, much like the well-studied impact of the JFK Apollo Moon program. The idea behind such growth, is not mankind successfully making money, and insuring everyone’s 401K, but is something far more fundamental: Mankind changing nature and our planet and beyond, so that we can move into the future.
As long as we measure such progress by counting dollars and cents, we will be forever caught in the debate of Keynesian-style quantitative easing versus murderous budget cutting.
To date, unfortunately, this debate has only be upended as a result of depression or war.
That is why we should adopt the National Infrastructure Bank now, and junk all thinking related to PAYGO. Why wait for the upcoming crash, again?