Here's a substantial portion of what Broder wrote:
In the wake of Hurricane Katrina, credible private experts are forecasting a federal budget deficit of $500 billion for this year, a sharp reminder of the government's fiscal folly.
For all the deserved criticism the Bush administration has received for its tardy and ragged response to the storm's ravages on New Orleans and the Gulf Coast, the long-term costs to the nation of the reckless disregard both the president and Congress have shown toward paying the nation's bills may be even greater.
[. . .]
The scale of the failure is measured by a set of numbers that Rep. John Spratt of South Carolina, the senior Democrat on the House Budget Committee, carries with him. They chart the annual increases passed by Congress in the national debt limit. In 2002 it was $450 billion; in 2003, $984 billion; in 2004, $800 billion; and this year, the House has passed an increase of another $781 billion, on which the Senate has yet to act. That totals a stunning $3 trillion in additional debt in four years -- a 50 percent increase in the cumulative debt from all of America's previous history.
When you look at that record, the self-congratulatory tone of the Republicans who have been running Washington seems absurdly unjustified. In July, when the White House Office of Management and Budget said the deficit for this year would decline to $333 billion from $412 billion in 2004, President Bush said, "It's a sign that our economy is strong, and it's a sign that our tax relief plan, our pro-growth policies are working."
In August, when the Congressional Budget Office lowered the deficit forecast to $331 billion, Republican Rep. Jim Nussle of Iowa, the chairman of the House Budget Committee, said, "We're clearly on the right track. The strong economy, higher revenues and falling deficit projections are all results of the successful leadership and policies of the Congress and the president."
These judgments were faulty at the time. They made no provision for the continuing costs of the war in Iraq, or for the Republican plan to end the estate tax and make all the previous Bush tax cuts permanent. And, most of all, they did not realistically calculate the costs of the new Medicare prescription drug benefit and the looming obligations to the millions of baby boomers who are nearing retirement age.
[. . .]
The warning signs of impending economic calamity are every bit as evident as the forecasts of ruin for New Orleans when a major hurricane hit.
The runaway budget deficits are compounded by the persistent and growing imbalance in our trade accounts -- jeopardizing the inflow of foreign funds we have used to finance our debt.
At a private dinner the other evening where many of the men and women who have steered economic and fiscal policy during the past two decades were expressing their alarm about this situation, one speaker summarized the feelings of the group:
"I think it's 1925," he said, "and we're headed for 1929."
Well, I can't say that I know whether or not an economic calamity is heading our way. A replay of 1929 seems impossible, if only because the federal government is so much larger now and spends so much more, thereby putting a floor under aggregrate demand in a way that was lacking before the Great Depression.
But, certainly, at some point there will have to be a reckoning. My firm belief is that Republicans won't address these issues during the rest of Bush's second term. Some of them aren't happy about what they've done, but some of them are content to drive the federal government into a fiscal crisis. I've blogged about this on many occasions. The "starve the beast" strategy is still part of the conservative playbook.
As I recently blogged "US Poverty Rate Climbs to 12.7%" the poverty rate has risen during the Bush years to 12.7%. Therefore, it's hard to imagine that the Bushies really believe that implementing their fiscal policies can do much if anything to combat poverty. Furthermore, household income has stagnated, which contrasts sharply with the well-known wage gains of the late 1990s.
But combatting poverty and boosting the income of the average American were never the real motives behind what the Republicans have been doing in the areas of fiscal and tax policy. The idea is to cut taxes, primarily for the already affluent, pocket the short-term support that such cuts bring, and wait for the time when big cuts in government spending become necessary.
The huge costs associated with the war in Iraq and hurricane Katrina will only serve to speed up the timetable a bit. Nothing of significance in contemporary conservative governance will change. I'll be happy to be proved wrong, but that's my prediction.
Saying no to bad Republican ideas is one thing, but it's not a long-term strategy. What might the latter look like? Here is what Dionne has to say:
. . . the Social Security debate so far has been a rare triumph for liberals: For the first time in a long while, core liberal principles are actually winning in a public debate. The idea that Social Security is an insurance program and not an investment plan is gaining traction. So is the view, advanced powerfully by Yale University political scientist Jacob Hacker, that more and more financial risk is being thrown onto individual Americans and that collective safety nets (notably for pensions and for health care) are being shredded. Secure, guaranteed private pensions are increasingly a thing of the past. Employer-provided health insurance is in trouble. This is encouraging many Americans to give liberalism another look.
One clear indicator of the transformation of the national discussion was the cover line on the May 16 issue of BusinessWeek, "Safety Net Nation." The article it referred to, by Lee Walczak and Richard S. Dunham, ran under the phrase: "Why so many Americans aren't buying into Bush's Ownership Society." The writers noted that even Republicans who love Bush and revere capitalism are seeking a certain degree of security and safety. When a leading business magazine highlights the importance of government safety nets to a successful capitalist economy, the times are definitely changing.
And that is why it is inescapable that for the long term, those who think of themselves as progressive do need to offer that compelling alternative vision. What's required are not some small-bore tweaks to Bushism, but a set of proposals that change the very nature of what is being debated nationally. What question should frame the national debate?
Eric Wanner, president of the Russell Sage Foundation, suggests that if the U.S. economy remains broadly open and trade broadly free, the result will be "more inequality because there are more winners and more losers."
The challenge, he argues, is to indemnify those who may find themselves on the losing end of the transaction. This points to a number of big policy ideas: wage insurance, to ease the transition from one job to another; broader earned-income tax credits, to push up the wages of the lower paid; pension portability and incentives to help lower- and middle-income Americans put away money. Above all, it means guaranteed health insurance in some form, an idea increasingly appealing to companies in a competitive world market that want to take health care costs out of the prices of their goods.
And in this climate, higher minimum wages and broader unionization are looking more attractive than ever.
The large debate the nation needs, in other words, is how to create enough security so that Americans can embrace a dynamic economy without fear. Paradoxically, throwing more risk onto individuals leads to risk-avoidance. Risk-taking requires a certain amount of risk-sharing.
To everything there is a season. There is a time for the Politics of No. When the time for Yes comes around, it ought to be about affirming bigger ideas and larger purposes.
Robert Samuelson has briefly sketched out a plan for reforming Social Security and Medicare. It's not a painless one, by any means, but it seems to be a fairly reasonable mixture of proposals, e.g., raising the retirement age to 70 (which seems a bit too high to me), charging higher Medicare premiums, and reducing Social Security benefits.
Jonathan Chait has just published an article in The New Republic on the topic of big-government conservatism. No, it's not a contradiction in terms, he says. It's quite simple:
Big-government conservatism consists of initiatives that benefit economic elites without using free-market mechanisms.
Chait then chronicles some of the ways the Medicare bill, various tariffs and tax breaks, etc. in which this ideology has been pursued by the Bush administration. He also points out that the sleaze surrounding Jack Abramoff and Tom DeLay pretty much follows inevitably from big-government conservatism.
Kevin Hall of Knight Ridder reports that Democrats are declaring that they won't negotiate Social Security reform as long as private accounts are being considered:
Top Democrats said Monday that they won't negotiate any remedy for Social Security's projected funding shortfall until President Bush and the chairman of the Senate Finance Committee first take private retirement accounts off the table.
The proposed accounts are a centerpiece of Bush's second-term agenda and the heart of what he calls an "ownership society," in which Americans take a more active role in saving for retirement.
Democrats say the accounts amount to privatizing Social Security because they would be carved out of payroll taxes that are now earmarked for Social Security. The president would let younger workers give up some promised Social Security benefits for the chance to earn potentially higher returns from stocks and bonds.
"As soon as the president publicly takes privatization off the table, then we are in a position to start" negotiating, Sen. Max Baucus, D-Mont., the top Democrat on the Senate Finance Committee, told reporters Monday. He later said he also wanted finance committee Chairman Charles Grassley, R-Iowa, to publicly disavow private accounts.
Private accounts "means the end of Social Security," said Rep. Sander Levin, D-Mich., the ranking Democrat on the Social Security subcommittee in the House of Representatives.
Jonathan Chait notes how Republicans have managed to change the terminology in which Social Security reform is discussed:
President Bush and his allies are probably going to lose his fight to privatize Social Security. But in the course of losing they have won an astonishing victory: They have established the precedent that a political party can unilaterally force the news media to change its terminology essentially. Push them hard enough, and the media will render verboten any previously agreed-upon phrase, no matter how widely accepted.
Up until very recently, the notion of allowing workers to divert their Social Security taxes into individual savings accounts was universally known as "privatization." Its most fervent advocates called it that. (The Cato Institute, one of the earliest champions of privatization, established a "Project on Social Security Privatization" in 1995.) Bush himself used the term. So did Karl Rove.
Late last year, though, Republican polls found that the public reacted far more favorably to "personal" accounts than to "private" accounts. So, overnight, they banished talk of "privatization" and "private accounts," accusing any journalist who dared use the phrase that they themselves had used mere weeks before of insidious bias. When a reporter asked about "privatization" earlier this year, Bush scolded: "You mean the personal savings accounts? We don't want to be editorializing, at least in the questions." A reporter told PR Week magazine that the White House staff informed him that if he wrote "privatization," "you have signaled you're against the White House."
Under this sustained barrage, the media have slowly retreated. In the first stage, news reports began alternating the two terms. (NBC's Tim Russert went a step further, adopting his own phrase, "private personal accounts.") This exquisite show of evenhandedness ignored the fact that one phrase was commonly used by both sides for years on end, while the other had been cooked up weeks before by a partisan pollster.
In the weeks that have passed, "personal" seems to be overtaking "private," like untreated weeds creeping over a garden. Politicians who dare use "oldspeak" risk censure, not just from Republicans but from the media themselves.
When House Minority Leader Nancy Pelosi attacked what she called Bush's "misleading privatization plan," a Washington Post news story immediately noted that "Bush has never advocated privatizing the entire program." This is the formulation that newspapers use when they want to alert readers that a politician is lying.
Psychoanalysis has a phrase for this phenomenon: identification with the aggressor.
There haven't been any big developments in the Social Security debate for a while, at least as far as I've noticed. President Bush is still pushing for change, as this AP bulletin in USA Today shows.
Apparently, the President is now willing to accept private accounts that are an "add-on" that's the term that is frequently bandied about to the system, and thus aren't financed by the payroll taxes that are ordinarily paid into Social Security.
Krugman's latest column contains some interesting figures regarding health care costs here in the U.S.:
In 2002, the latest year for which comparable data are available, the United States spent $5,267 on health care for each man, woman and child in the population. Of this, $2,364, or 45 percent, was government spending, mainly on Medicare and Medicaid. Canada spent $2,931 per person, of which $2,048 came from the government. France spent $2,736 per person, of which $2,080 was government spending.
Amazing, isn't it? U.S. health care is so expensive that our government spends more on health care than the governments of other advanced countries, even though the private sector pays a far higher share of the bills than anywhere else.
In the rest of the column Krugman looks at some of the reasons for why our more expensive system tends not to provide better care:
Most Americans probably don't know that we have substantially lower life-expectancy and higher infant-mortality figures than other advanced countries. It would be wrong to jump to the conclusion that this poor performance is entirely the result of a defective health care system; social factors, notably America's high poverty rate, surely play a role. Still, it seems puzzling that we spend so much, with so little return.
A 2003 study published in Health Affairs (one of whose authors is my Princeton colleague Uwe Reinhardt) tried to resolve that puzzle by comparing a number of measures of health services across the advanced world. What the authors found was that the United States scores high on high-tech services - we have lots of M.R.I.'s - but on more prosaic measures, like the number of doctors' visits and number of days spent in hospitals, America is only average, or even below average. There's also direct evidence that identical procedures cost far more in the U.S. than in other advanced countries.
The authors concluded that Americans spend far more on health care than their counterparts abroad - but they don't actually receive more care. The title of their article? "It's the Prices, Stupid."
Why is the price of U.S. health care so high? One answer is doctors' salaries: although average wages in France and the United States are similar, American doctors are paid much more than their French counterparts. Another answer is that America's health care system drives a poor bargain with the pharmaceutical industry.
Above all, a large part of America's health care spending goes into paperwork. A 2003 study in The New England Journal of Medicine estimated that administrative costs took 31 cents out of every dollar the United States spent on health care, compared with only 17 cents in Canada.