Edited by Michael Greenstone, Max Harris, Karen Li, Adam Looney, and Jeremy Patashnik
The Hamilton Project asked leading experts from a variety of backgrounds—the policy world, academia, and the private sector, and from both sides of the political aisle—to develop pragmatic, evidenced-based proposals which could form a partial menu of options to achieve responsible deficit reduction. The resulting fifteen proposals are included in 15 Ways to Rethink the Federal Budget.
Few policy debates have been as contentious as the current tug-of-war over the federal budget deficit. Despite widespread agreement that the budget is on an unsustainable path, there is widespread disagreement about what should be done. At the heart of the debate is how federal policy should address the key economic issues our nation faces. Of immediate concern to policymakers, however, are the nation’s employment situation and the need to get Americans back to work. At current sluggish rates of recovery, it will take years for levels of employment to normalize after the Great Recession. Even after the economy recovers, Americans will confront the lasting impacts on those who experienced long-term unemployment, the growing divide of income and opportunity, concerns about the competitiveness of our workers and businesses in a globalizing economy, and ongoing environmental challenges. These economic factors both have contributed directly to our high and growing federal debt, and color how we should address it.
Changes in tax and spending programs should be judged not only by how they affect future budget deficits, but also by how they address these economic challenges. As we argued in a recent Hamilton Project policy memo, “A Dozen Economic Facts about Tax Reform,” changes in budget policies should be evaluated on how they support the near-term economic recovery, invest in the productivity of American workers and industries, influence the progressivity of the tax code, and secure our nation’s social safety net.
The budget talks, therefore, represent not only a political and economic challenge, but also an opportunity for policymakers to decide what type of country we will be in the coming years and decades. But, sound decisions require a budget debate rooted in facts—not ideology.
To this end, The Hamilton Project asked leading experts from a variety of backgrounds—the policy world, academia, and the private sector, and from both sides of the political aisle— to develop policy proposals that could form a partial menu of options to achieve these goals. The mandate given to the authors was to describe pragmatic, evidenced-based proposals that not only are good budget policy, but that also have economic benefits. The resulting fifteen papers are included in The Hamilton Project’s latest report, “15 Ways to Rethink the Federal Budget.” While not intended to cover every budget category, these papers take on a wide-ranging set of topics, including immigration, transportation, health care, and tax expenditures, and include options to reduce mandatory and discretionary expenditures, raise revenues, and improve government efficiency.
This introduction provides economic context salient to budget discussions and an overview of the fifteen proposals including their potential impact on the budget and their broader economic benefits.