I’ll leave the savvy political analysis to others. I don’t know why Senator Joe Manchin apparently decided to go back on an explicit promise he made to President Biden. Naïvely, I thought that even in this era of norm-breaking, honoring a deal you’ve just made would be one of the last norms to go, since a reputation for keeping your word once given is useful even to highly cynical politicians. I also don’t know what, if anything, can be saved from the Build Back Better framework.
What I do know is that there will be huge human and, yes, economic costs if Biden’s moderate but crucial spending plans fall by the wayside.
Failure to enact a decent social agenda would condemn millions of American children to poor health and low earnings in adulthood — because that’s what growing up in poverty does. It would condemn millions more to inadequate medical care and financial ruin if they got ill, because that’s what happens when people lack adequate health insurance. It would condemn hundreds of thousands, maybe more, to unnecessary illness and premature death from air pollution, even aside from the intensified risk of climate catastrophe.
I’m not speculating here. There’s overwhelming evidence that children in low-income families who receive financial aid are significantly healthier and more productive than those who didn’t once they become adults. Uninsured Americans often lack access to needed medical care and face unaffordable bills. And studies show that policies to mitigate climate change will also yield major health benefits from cleaner air over the next decade.
As an aside, it’s not clear how many Americans realize the extent to which we’re falling behind other nations in terms of meeting basic human needs. For example, I still keep running into people who believe that we have the world’s highest life expectancy, when the reality is that we can expect to live between three and five fewer years than citizens of most European countries.
There are also, by the way, large and growing gaps between U.S. states. In 1979 life expectancy in West Virginia was only about 14 months shorter than in New York; by 2016 the gap had widened to six years. And yes, Manchin’s home state would benefit immensely from the social spending its Democratic senator seems determined to block.
The weakness of the U.S. social safety net also has economic consequences. It’s true that we still have high gross domestic product per capita — but that’s largely because Americans take far less vacation time than their counterparts abroad, which means that they produce more because they work more hours. In other ways we lag. Even before the pandemic, Americans in their prime working years were less likely to be employed than citizens of Canada or many European countries, probably in part because we don’t help adults stay in the work force by providing child care and parental leave.
But can we afford to make our lives better? One answer is that other rich countries seem to manage it just fine. Another answer is that Manchin’s objections to the proposed legislation evaporate under scrutiny.
Manchin asserted that the Congressional Budget Office determined that the cost of the bill is “upwards of $4.5 trillion.” No, it didn’t. That was a Republican-demanded estimate of outlays — not the considerably smaller impact on the deficit — under the assumption that everything in the legislation would be made permanent, which isn’t what the bill says. And if Congress did vote to extend programs like the child tax credit, it would probably also vote for revenue offsets. The budget office analysis of the legislation as actually written — which found it roughly deficit-neutral — is a much better guide to its likely fiscal impact than this rigged hypothetical.
As for Manchin’s claim that we have a “staggering” national debt, maybe it’s worth noting that federal interest payments as a percentage of G.D.P. are only half what they were under Ronald Reagan, and that if you adjust for inflation — as you should — they’re basically zero.
What about inflation? The proposed spending in Build Back Better is spread over multiple years, so it wouldn’t do a lot to raise overall demand in the near term — the first-year addition to the deficit would be just 0.6 percent of G.D.P., which isn’t enough to make much difference to inflation in any model I know. Besides, the Federal Reserve has just made it clear that it’s ready to raise interest rates if inflation doesn’t subside, so government spending should matter even less.
As I said, I’m not going to try to analyze Manchin’s thought processes, and I’ll leave it to others to speculate about his personal motives. What I can say is that the letter he released to explain why he said what he said on Fox News doesn’t read like a carefully worked-out policy statement; it doesn’t even read like a coherent ideological manifesto. Indeed, it feels rushed — a grab bag of Republican talking points hastily trotted out in an attempt to justify his abrupt betrayal and to portray himself as a victim.
Sorry, but no. America — not a senator who’s taking heat for a broken promise — is the victim in this story.
The G.O.P.’s War on the Poor
Four years ago, on the 50th anniversary of Lyndon Johnson’s war on poverty, House Republicans led by Paul Ryan issued a report declaring that war a failure. Poverty, they asserted, hadn’t fallen. Therefore, they concluded, we must slash spending on the poor.
.. it calls for the widespread imposition of work requirements for Medicaid, food stamps and other programs. But that would have the effect of sharply reducing those programs’ coverage.
.. This decline in coverage wouldn’t be the result of large numbers of people earning their way out of poverty. Instead, many poor Americans would, for a variety of reasons — poor health, job instability for low-wage workers, daunting paperwork imposed on those least able to deal with it — find it impossible to meet the requirements, and be denied aid despite remaining poor.
.. whatever the evidence, Republicans always reach the same policy conclusion. Was the war on poverty a failure? Let’s stop helping the poor. Was it a success? Let’s stop helping the poor.
.. And let’s be clear: We’re talking about the whole party, not just the Trump administration. In particular, Republican governors are fanatical about cutting benefits for their lower-income residents.
.. In Maine, voters overwhelmingly approved an initiative to expand Medicaid under the Affordable Care Act. But Gov. Paul LePage has refused to implement the expansion — a vast majority of which would be paid for with federal funds — despite a court order, and has declared that he’s willing to go to jail rather than see his constituents get health care.
How to Get American Men Back Into the Workforce
Rethink unemployment insurance and increase public investment in improving skills.
When it comes to prime-age men working, the U.S. compared unfavorably with other advanced economies, falling in the bottom half of the Organization for Economic Cooperation and Development despite having the second-least-generous disability benefits in the group and nearly the shortest duration of unemployment insurance benefits.
.. The largest issue facing American men is not that they are rewarded for remaining in a recliner, but that they cannot find rewarding work. The bulk of the decline in employment has been for men with a high-school diploma or less, who have seen their employment rates fall from 97% in 1964 to 83% today. This has coincided with a decline in their relative wages: High-school grads in the 1970s earned two-thirds what their college-educated counterparts took home. Today it’s around half.
.. Forty-four percent of the prime-age men who have left the labor force are on pain medication, according to Princeton economist Alan Krueger. The Council of Economic Advisers recently estimated this epidemic is costing the U.S. economy $500 billion annually. Spending even a tiny fraction of that sum on treatment, counseling and prevention could be a profitable investment. Cutting Medicaid would make it harder for those suffering from addiction to receive the treatment necessary to overcome it and get back to work.
The Best Era for Working Women Was 20 Years Ago
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Things seem to have changed around the 2001 recession. Until then, women tended to keep their onward march into employment steady even when the economy faltered. If their employment dipped, it quickly recovered. But this was the first time that the share of working women dropped without bouncing back.
.. Husbands’ wages grew faster than wives’ in the 1990s, which may have eventually discouraged married women from staying at work.
.. For lower-wage women, work itself has also gotten worse. Research by Robert Moffitt, a Johns Hopkins economist, has found that the decline in women’s labor force participation, especially among lower-educated women, mirrors that of their male peers.
.. The low-wage jobs these laid-off workers found are more likely to come with variable schedules that make it difficult to arrange child care. Work hours have also stretched later and later, which hurts women more... the United States has done almost nothing to help make it easier for parents to work and raise a family at the same time. Unlike all other developed countries, the United States doesn’t guarantee parents any paid time off when they have children... If the United States were to spend more on helping parents get child care, ensure they can take paid time off work and protect those who want or need to work flexible schedules, it would almost certainly tap into this pool of women who have stepped away from work... the economy would have been 11 percent smaller if women’s labor force participation had remained at the levels of the late 1970s... President Trump has said he wants to reach 3 percent G.D.P. growth. He would do well to focus on increasing how many women work... This is a man who said in the 1990s — that same decade when working women reached their zenith — that “putting a wife to work is a very dangerous thing.”He’ll find out how dangerous it is for the economy when the government doesn’t help put all women, married or not, to work.