The debate we should be having, instead of the spending freeze

I wrote a few days ago about what a silly idea a spending freeze is. We need to be working on getting ourselves out of a recessionary hole and back on a self-sustaining growth path, not cutting the spending that's helping us do just that. The job initiatives the president has proposed are all fine and dandy, but are just a drop in the ocean of 10% unemployment (more than 17% unemployed if you add in discouraged workers and those who are working part time when they would rather have a full time job).

Paul Krugman is right to denounce the freeze as a gimmick, but he should go even further. The gimmick can't even work on its own terms. Even if we think closing the deficit gap is the right policy for January 2010 (which it isn't), a spending freeze won't get us there. The gap is too big for a freeze on just 25% of the total budget -- it will do little more than slow down the rate of increase. Even worse, if we exempt the military, national security, Medicare, Medicaid and interest on the debt from a freeze, we are left with the 25% of the budget that contains almost all of the actual investment that the federal government does. And investment is the key. If we are going to spend money, we should be doing it in ways that increase future productivity. It is great that the president sees the need for investing in education, but there is also a major need for physical investment as well. And while a few miles of bullet train tracks in Florida is a good start, if that is as far as it goes, then it is just one more gimmick.

Republicans and teabaggers are unable to participate in a debate like this because they believe that ALL government spending is wasteful. They compartmentalize the part of their brain that sees the pot-hole ridden roads we drive on, the ports and harbors that our trade flows through, the airports that are increasingly decrepit and crowded, and the Internet infrastructure that lags behind our foreign competitors.

The debate we should be having is over how to make sure a second stimulus gets spent on real investments, rather than tax breaks for people who don't need them and spending on consumption that isn't necessary. We should NOT be debating how to cut non-defense discretionary spending.