I recently left a great job at the White House, serving President Obama and Vice President Biden and working with an inspiring team of smart, dedicated economists.
Our office played an integral role in implementing the Recovery Act -- I was the Vice President's chief economist, I worked with a brilliant staff, and "Sheriff Joe" was the implementer-in-chief. For a Keynesian economist, this was an exciting and challenging assignment, and under the guidance of the VP, that intervention broke the back of the great recession and significantly pulled forward the recovery that's now underway.
I got to weigh in on the most important economic policies of the day, often with the president himself, whose economic vision I still very much believe in and support. I had a really cool office, a decent parking space, and I even met George Clooney once in the White House (not to mention Bo!).
How could you leave a job like that?
It's not, as some accounts suggested, because ideas that I was associated with, like more stimulus, are off the table. I'm not happy about that and, in fact, I believe that if we were to make policy based purely on the economics, more stimulus would be at the top of the list. Excess capacity in the private sector, most importantly in the job market, is still the biggest problem we face, and given the cost of capital right now, the best way to both reduce unemployment and the short-run deficit is to grow faster.
So if it were up to me, I'd step a bit more on the fiscal accelerator. But that's not why I left.
I left because I was frustrated. Not with what was going on inside the White House, but with what is going on outside.
The national debate over economic policy is way off track and the stakes are as high as can be. In every important area of economic and social policy--health care, fiscal policy (deficits, debt, taxes), public investment, retirement security, climate change, education, job growth, income distribution--there's so much misinformation, so many false assertions, that it is impossible for anyone paying attention to evaluate the choices with which they're faced.
Most important, as the 2012 election season gears up, we are poised to have a fundamental debate about the size and role of the federal government. But absent straight talk and plain, understandable facts from both sides of the argument--about the costs and benefits engendered by this choice--it will be impossible for voters to make an informed choice.
Let me be clear about where I stand. I view the conservative agenda right now as trying to implement a large shift in who bears the risk of those events in our personal and economic lives that are inadequately handled by private markets. In my view, to get this wrong means significant disinvestment in public goods from education to infrastructure, diminished health and retirement security, more booms and busts--a move from "we're in this together" to "you're on your own."
But let me also be clear about this: there's a legitimate argument to be had about this choice and I don't assume that if the quality of our economic debate were suddenly vastly improved, my view of what's good economic policy would prevail. A majority of the American electorate might well decide, once they had the facts, that they wanted a quite different sort of government, one that was much smaller, did less, and cost less as well.
But that's not the argument we're having. Conservatives essentially argue we can have it all for less: get government "out-of-the-way" and health care, job growth, investment, upward mobility, would be enhanced, not diminished. These claims are difficult to defend using facts--as opposed to assertion--and part of this blog will be devoted to sorting through them.
Democrats lately seemed to be trapped in a position that amounts to: "sure, we have to cut and shrink--just not as much as the other guys want."
There's got to be a better way--a way to widen this terribly narrow debate.
Why couldn't I do more to help from the inside? One reason is that in order to move the ball forward, you need consensus, and in today's politics, that is particularly elusive. And that makes it especially hard to call out people and their arguments. There's a reason why Jon Stewart can speak truths that highly-placed elected officials cannot. When you're on the inside at a time like this, you're constantly balancing the risk of losing the support of people you need to lead.
So, not meaning to be at all grandiose, I'm going to try to do my part to improve the debate from the outside, to make sense out of the arguments, to go for truth over truthiness, to elevate the facts of the case in a way that's respectful to all sides of the case. It's also my hope that by dint of my recent experience at the White House, I can imbue this blog with a sense of political realism that's sometimes missing in critical commentary.
And while I have only one voice, I'm joining a choir that already makes some very powerful music (Paul Krugman's voice is particularly notable, and his list of other choir members looks a lot like my own).
We are still a great nation with a tremendously flexible economy. Yes, it's an economy that has a long way to go to get where it needs to be--from the middle class on down, conditions are still extremely tough. But I intimately know how deeply screwed-up things were a few short years ago, and I'm frankly surprised by how well we're doing relative to where we were.
Our workforce is highly productive, our capital markets among the most developed and fluid in the world, our technological prowess and entrepreneurial spirit as strong as ever. But if we don't start getting a lot smarter about the choices we face, these great institutions will erode. Of this I am certain.
So enjoy the blog. I was going to say: "let me know what works and what doesn't"--but I have a feeling I don't need to tell you that...
This post originally appeared at Jared Bernstein's On The Economy blog.