These poverty, inc, and hth ins data are last year's data, so their news window closes quickly, but before that occurs, pls read our thread. There are powerful policy lessons in here, including some relevant to current @POTUS agenda.
Gov't support made a huge difference to economically vulnerable households last year; direct impact checks were particularly potent. Middle-class inc fell last year and poverty rose if you ignore these benefits; the reverse if you include them.
IOW, policy matters and we know how to aggressively and effectively attack poverty and income loss. That old meme--'we fought a war on poverty and poverty won'--is demonstrably false if you account for anti-poverty policy (as does the SPM)!
This lesson is carried forward by @POTUS's investment agenda. These 2020 policy gains are huge but they must be followed by policies that lastingly cement these gains, as @CenterOnBudget describes: cbpp.org/press/statemen…
Long-term investments in care, climate, education, lead-free pipes, housing, and more, build on these gains from temporary fiscal policy to offset the pandemic shock, providing people the chance not just to get out of poverty, but to stay out of poverty.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
In recent conversations, I’ve been noodling on different ways to understand the costs and benefits of the $3.5 trillion reconciliation plan. In important ways, this topline number provides the least informative perspective.
First, that’s a gross number. It ignores the impact of “payfors” on the net cost. Over the next decade, that net cost is ZERO (ftr, the gross cost is ~1% of GDP). And those are highly progressive payfors that hit no one under $400K!
2nd, the investment component (as well as the tax cuts) spend out over time. Even if you ignore payfors (and pls don’t do that!), the gross $3.5t spends out over the next decade. EG: In year 1, ARP spent out 63%; in year 1 BBB+infrastructure spends out 6%!
Just wanted to make sure every saw @ojblanchard1's thread on this "mini-revolution" in how we understand our fiscal situation. This goes way beyond budget wonkery and invokes smarter fiscal policy, myth busting, and even how progress occurs in economics.
The idea is to elevate real debt service to a prominent perch in the analysis of fiscal space. As @ojblanchard1 says, "this is what matters. If we have good uses for debt, such as the various forms of public investment in the Biden plans, this is the time to do it..."