Sure Recipe for Decline: Neglect and Gluttony
By MATT BAI
Published: February 16, 2011
WASHINGTON
As the White House and Congressional Republicans duel this week over their respective budget proposals, the conversation in the capital is all about the size and role of the federal government. Basically, President Obama would cut some and spend a lot; Republicans would cut a lot and spend much less.
There is another way to look at this argument, though, which is that both sides have now laid out competing visions of what should frighten us most about the future. Both the president and his adversaries are basing their budgets on fears of a looming and permanent American decline, but their priorities reflect a profound disagreement on what will cause that decline and how we can avoid it.
Mr. Obama’s $3.7 trillion budget, like his State of the Union address three weeks ago, is premised on what you might call the “national neglect” theory of decline. In this view of the world, if we fail to invest now in the kinds of things that will enable 21st-century industries to flourish, then the United States in 2050 might look like 19th-century Britain or France, whose economic dominance bred a kind of self-satisfied apathy while our hungrier forefathers ran around inventing light bulbs and Model T’s and stuff like that.
In order to avert the same fate at the hands of rising economies in India and China, Mr. Obama would invest billions now to lay down high-speed rail lines, expand the wireless Internet and educate a new generation of entrepreneurs, to name a few of his most pressing priorities.
The president admits that government debt could become a crippling problem, but Mr. Obama has faith that the two parties will ultimately work together behind closed doors to head off any fiscal crises — just as they have several times in the past 30 years. Mr. Obama doesn’t say it quite this way, but the crux of his argument seems to be that you can always sit down and hammer out a passable deal to change the financing of Social Security or Medicare, but you can’t just run out and build a national high-speed rail network whenever the thought finally occurs to you. By then, it might be too late.
House Republicans, meanwhile, foresee an economic decline more along the lines of a “national gluttony” model. In their nightmare, America in 2050 looks a lot like something out of “Road Warrior” — or, worse yet, Greece. That’s because we will have long since spent our way to the point where every penny of our taxes goes to service the national debt or to pay for entitlement programs, which means there will be no money left to invest in anything. America will be wholly owned by the Chinese and other creditors, and our businesses won’t be able to expand or innovate because the cost of capital will be prohibitively high.
Republicans don’t necessarily dispute that the country’s infrastructure could use an upgrade; they just think there’s not much government could ever think to do that the private sector, unencumbered by regulation and taxes, couldn’t do more efficiently. And if you don’t get a hold on federal spending immediately, they argue, all the wireless hubs in the world won’t be able to help you.
These competing visions — decline by neglect versus decline by gluttony — aren’t by any means mutually exclusive, and you don’t need a Mensa membership to see that we can’t really afford to play around with either one. To argue that government shouldn’t invest in making the country technologically viable is to ignore the role that tax dollars played in building railroads and highways and the Internet. It wasn’t some start-up in a garage that landed Apollo on the moon, spawning an aerospace industry and all kinds of ancillary technologies.
At the same time, as the president’s own debt commission pointed out (using data from the Congressional Budget Office), even waiting 10 years to address the long-term debt could double the spending cuts and tax increases needed to set right the country’s finances. And sooner or later, the experts will tell you, that impending crisis will lead to higher interest rates and stifled enterprise.
The question, then, is the extent to which either party’s theory of decline allows room for addressing the other. And in this way, Mr. Obama would seem to be taking the more balanced approach.
True, Mr. Obama didn’t act on his own debt panel’s recommendation in the budget, and his proposed $1.1 trillion in deficit reduction over the next decade doesn’t amount to a dent in the long-term problem, or even really a ding. But the president did propose some cuts to programs long cherished by his party (like community block grants and aid for water treatment plants), and he has repeatedly acknowledged the need to address the structural problems in the federal budget, which he argues will require a gradual process with cooperation from both parties.
Republicans, on the other hand, while making a strong push for curtailed spending in the short term, have yet to accept the case for any real public investment in technology or education or anything else, for that matter. The entirety of their case rests on the notion that the private sector can by itself build a state-of-the-art infrastructure — a possibility, certainly, but not one for which you can really find much evidence in any previous chapter of the American story.
The real danger for the country probably isn’t simply neglect or gluttony, but something more like a combination of the two. Which means that it’s possible to head off one avenue of decline, only to hurtle heedlessly down the other.
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