What is the Biden administration for?
If you had asked me that question in 2021, I would have said
the Biden administration’s chief purpose is to narrow the economic chasm.
America is bitterly divided between highly educated people who live in places
that are thriving and less educated people who live in places that are left
behind. That economic and social divide threatens US politics, US shared
prosperity, and the US’ social fabric.
اضافة اعلان
In its first two years, Biden’s administration successfully
began to tackle this fundamental problem. Through the infrastructure law and
many other measures, Team Biden directed huge amounts of money to create
working-class jobs and to increase benefits to working-class families. That
spending contributed to white-hot labor markets that have lifted wages, brought
people back into the labor force, and turbocharged American capitalism.
Yes, inflation surged. Yes, the US is still bitterly
divided. But things would have been immeasurably worse if the struggling places
were left to founder in the same economic mire. The Biden policies were more
than worth it.
If you ask me now what the Biden administration is for, my
answer would be different. Today, its main purpose is to prepare the nation for
a period of accelerating and explosive change.
Writing in Tablet magazine this week, the scholar and
columnist Walter Russell Mead notes that there have been three periods of
transformational change over the course of human history: the Neolithic period,
which brought about settled farming, writing, and the birth of cities; the
Industrial Revolution, which gave us factories, mass production and cars; and
the information age.
Until a few years ago, the information age seemed like the
least consequential of the three. Computers and TikTok are nice, but they have
not produced the kind of society-altering transformations we saw during the
other two civilizational turning points.
Yes, inflation surged. Yes, the US is still bitterly divided. But things would have been immeasurably worse if the struggling places were left to founder in the same economic mire. The Biden policies were more than worth it.
That seems to be changing.
The information age is accelerating and growing more
disruptive. The first cause is artificial intelligence. AI will produce
pervasive breakthroughs and threats that none of us can now predict. Another
cause is the emerging cold war with China. This will produce a remorseless
technological competition that will turbocharge developments in biotech,
energy, chip manufacturing, trade flows, political alliances, and many other
spheres.
We are living in the first stages of what my colleague
Thomas Friedman a few years ago called “the age of acceleration,” an age of
both stunning advances and horrific dislocations. This is a period of radical
uncertainty, a period in which predictions are likely to be wrong and midrange
plans are likely to become obsolete. We are going to need governments that are
able to pivot quickly and throw tidal waves of money at suddenly emerging
problems, from technologically driven mass unemployment to war in the Pacific.
When COVID hit, the US successfully pivoted and threw
trillions of dollars at that problem. But the US may not be able to mobilize
that kind of response in the future. That’s because we’re now manacled by debt.
During the Trump administration, the debt increased by
roughly $7.8 trillion, and during the Biden administration, it has increased by
about $3.7 trillion. Over the past 50 years, the annual federal deficit has
averaged about 3.5 percent of GDP. Over the next 10 years, the Congressional
Budget Office expects that deficits will average 6.1 percent of GDP.
The US is projected to spend roughly $640 billion this year
merely paying interest on that debt, a figure that is expected to more than
double by 2033. That is about the time the Social Security Trust Fund will
become insolvent, requiring even more gigantic cash infusions to keep the
program going.
The information age is accelerating and growing more disruptive.
Any prudent family saves money as hurricane season
approaches, so it can deal with the coming storms. With self-destructive
recklessness, the US is doing the exact opposite.
Seen from this perspective, the debt ceiling fight looks different.
Yes, it is insane that Republicans are playing a game of chicken that could
send the world economy into turmoil.
But the fact is that the debt ceiling has often been an
occasion to put a brake on excessive spending. Of the past 43 debt limit increases
or suspensions, 27 were attached to other legislation, according to Maya
MacGuineas of the Committee for a Responsible Federal Budget. Debt ceiling
increases were attached to both the 1985 and the 1987 Gramm-Rudman-Hollings
bills, which established deficit targets. The budget deals of 1990, 1993 and
1997, which led to balanced budgets, also included debt ceiling increases.
Republicans play this game harder, but Democrats have played it too.
Given the historical circumstances, President Joe Biden
should absolutely negotiate with Republicans over a debt reduction deal. Yes,
Republicans are being reckless. But the central truth remains: We need to bring
down deficits so that we have the flexibility and resources to handle the
storms that lie ahead.
There are many ways to do this. I would favor a progressive
consumption tax that could be raised or lowered as the coming turmoil rages and
ebbs.
But first, Biden has to redefine his presidency to keep up
with emerging realities. It is not 2021 anymore. We are entering an era of
rapid technological transformation and unforeseeable tectonic shifts. In
contrast to Donald Trump, who is all about himself, Biden can be the source of
security in times of chaos. For that to happen, we need a government that is fiscally
sound and ready for anything.
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