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AUGUST 1, 2023
On the Prospect website today: David Dayen's profile
<[link removed]> of the
all-but-unknown man most responsible for the current structure of
American health care, such as it is, and two articles on American banks:
one
<[link removed]>
on their resistance to the administration's efforts to make them safer
for depositors and the general economy; the second
<[link removed]>
on the Fed's efforts to address the banks' concerns over those of
the general economy.
Meyerson on TAP
Bidenomics Refutes the Canard That Government Is Slow
America's industrial renaissance is happening faster than almost
anyone anticipated.
It is a lie universally acknowledged as truth that the government is
slow, that if you want something done quickly, you turn to the private
sector.
Of course, there are a plethora of instances in which government
**is** slow. Consider, for instance, the efforts of the National Labor
Relations Board to compel companies to pay workers whom they've
illegally fired for trying to unionize. Lawbreaking companies can drag
this out for years. Of course, that's because, beginning with the
Taft-Hartley Act 75 years ago, companies and their handmaidens in
Congress and the courts have stripped the NLRB of the power to enforce
this law expeditiously. When the government is slow, that's often
because powerful private-sector actors have slowed it down to their own
advantage.
But sometimes, government can be more swift and effective than its
critics can even imagine, as the implementation of the three signature
pieces of Biden administration/Democratic Congress legislation is now
demonstrating. The Infrastructure Act, the CHIPS Act, and the Inflation
Reduction Act have spurred the economy, which grew by 2.4 percent in the
last quarter, well beyond anything the private sector could have
accomplished by itself, and in less time than establishment economists
thought possible. America is building factories again: The spending on
factory construction is up by 76 percent
<[link removed]>
from last year. Business spending on all forms of infrastructure-not
just factories but also transportation equipment, software, and the
like-is up by 56 percent. Through the magic of Keynes's multiplier
effect, government subsidies and outlays of roughly $300 billion on such
projects have led to an increase in business investment of an additional
$500 billion. And bolstering all this investment is the consumer
purchasing power that has resulted from Biden's initial stimulus
legislation, which ended the COVID recession much more quickly than any
recession in American history and yielded near record-low unemployment
and levels of labor force participation not seen in many years.
Biden has sometimes been compared to Franklin Roosevelt for his efforts
to renew and expand the kind of social insurance and worker empowerment
initiatives that FDR undertook. I'd argue that it's the scope,
speed, and success of his public investments that most resemble
Roosevelt's. Facing the actual prospect of mass starvation in the
winter of 1933-1934, FDR's public-works program managed to employ
three million Americans-in a nation of 130 million-in just 60 days.
The defense spending that began in 1940 in response to the very real
threat of the fascist control of all Eurasia built an army that then
ranked 39th in the world in size into one that was the world's largest
by 1944, at which time the nation's production of planes, ships, and
tanks exceeded the combined total of all other nations'.
Learning not just from Roosevelt's successes but also from the failure
of the Obama administration to highlight the projects that its stimulus
spending had created, Biden and Democrats are now volubly touting the
projects that their own stimulus programs have engendered, many of which
are already springing up. Given the public's skepticism about the
effects and durability of this economic revival, and the Republicans'
insistence that no such revival exists, Biden & Company know they will
have to keep making this case straight through November of next year.
That said, can we acknowledge that Bidenomics is not only successful but
speedy? Yes, we can.
~ HAROLD MEYERSON
Follow Harold Meyerson on Twitter <[link removed]>
[link removed]
Patient Zero
<[link removed]>
Tom Scully is as responsible as anyone for the way health care in
America works today. BY DAVID DAYEN
Banks: The Weak Spot in a Strong Recovery
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The larger problem is feeble and captured regulation, resulting in
multiple intra-executive branch fights. BY ROBERT KUTTNER
Jay Powell's Federal Reserve: Protection for Bankers, Pain for
Everyone Else
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Continuing interest rate hikes as the Black unemployment rate starts to
tick up reveal a misunderstanding of monetary policy history. BY DAVID
STEIN & NATHAN TANKUS
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