Ezra already flagged this, but it's pretty important, so here it is again: Jared Bernstein of EPI and Bob Rubin of Clintonian fiscal hawkery have together written an op-ed laying out the liberal consensus on economic policy for the foreseeable future. It's really got it all: stimulus, unions, John Kenneth Galbraith, and fiscal responsibility. Given that the Prospect has devoted considerable space to telling Rubin off, it's particularly notable that he is picking up the pen here to argue in favor of these kind of policies. A sampling:
The Bible got this right a long time ago (paraphrasing slightly): there's a time to spend, a time to save; a time to build deficits up and a time to tear them down. Though one of us (Mr. Rubin) is often invoked as an advocate of fiscal discipline, we both agree that there are times for fiscal discipline and times for fiscal largess. With the current financial crisis, our joint view is that for the short term, our economy needs a large fiscal stimulus that generates substantial economic demand.
We also jointly believe that fiscal stimulus must be married to a commitment to re-establishing sound fiscal conditions with a multi-year program that includes room for critical public investment, once the economy is back on a healthy track.
That was where Rubin reverses the priorities he helped impose on the Clinton administration in 1993: Instead of deficits then investment, it's investment then deficits. Interestingly, they single out health care reform as the most important project of stimulus, while in a more worrying fashion they don't mention the kind of infrastructure investment that is necessary in the short term until later, when they are praising labor's use as a countervailing power. Anyways, go read the whole thing.
--Tim Fernholz
