Spending Cuts Even Democrats Can Support

My piece in today's TCSDaily argues that economists, Democratic ones included, should support large cuts in government expenditure.  An excerpt:

Reasonable economists can disagree about the magnitude of distortions caused by taxes, as well as on whether continued borrowing will cause a financial crisis. And reasonable economists are understandably skeptical about starving the beast, since the substantial increase in expenditure following the Bush tax cut is at odds with this hypothesis.

But the claim that government expenditure cannot be cut is dead wrong. I offer here a list that Democratic economists should embrace.

The full column is here.

Comments

[LP Mike Sylvester]

The full article is certainly worth a read!

I am an accountant and I love economics. I have done a lot of research and I just do not understand where the "Republican" economists are not seriously advocating for real spending cuts.

Cutting taxes while radically increasing spending does not make sense.

Mike Sylvester

[Eric Wingo]

Mr. Miron's article is preaching to the choir. These ideas are not revolutionary. They also, I fear, will not get anyone elected to office. I am a memeber of the choir. I don't know why opinions like Mr. Miron's and actions to put those opinions into action do not get folks elected. If one has a plan to sell the ideas like Mr. Miron's well enough to have them put into practice, that person has the original idea. Hopefully, articles like Mr. Miron's are a start.

[Park Chamberlain]

I liked the column but I have to correct an error. Social Security is definitely means tested today for retirees with significant outside income, because up to 85% of their Social Security income is included in their adjusted gross income on their 1040. I am a professional tax preparer and see this all the time on the 1040s of retirees.

[Isaac]

Where do you get the 70 billion figure for pork from? That seems awfully high.

Also, there are reasons that certain programs aren't means-tested: if they were, Democrats claim, political support would collapse. So these are hardly cuts that democrats could support.

[Mike Huben]

I always love when conservatives and other ideologues presume to tell us what democrats would want. it shows how detached from reality they are.

[knzn]

I have heard before the Democratic objection cited by Isaac, but as a Democrat myself, I would be inclined to support this package of cuts. However, if I were a Republican, I would not. If I were a Republican, I would be concerned about the incentive effects of means-testing government benefits. As I argue here, means-testing benefits is exactly equivalent to raising marginal tax rates, and the implied increases would, I think, be quite hefty. Why, for example, should a reasonably well-off person (someone who expects to be near the means-testing margin) save more for retirement if the additional retirement income will only reduce his or her Social Security benefits?