I like Tyler Cowen’s Marginal Revolution blog quite a bit. He never fails to have at least one quirky link worth reading each day. There are enough economic papers linked to to keep me on my toes. Plus there’s the food recommendations for which he is so well-known.
This weekend, Tyler did something rare and risky: attaching his name to concrete, long-term predictions about the future of America. I don’t agree with all of them, but they’re great food for thought. Let’s look at a couple of the most interesting ones.
3. Social Security won’t much change, keeping in mind that the number of elderly voters is growing larger every day. Given all their elderly white voters, the Republicans are already “the party of Medicare.” The Democrats have become “the party of Medicaid.” That locks three major programs into place, more or less. I don’t hear serious talk of major cuts in defense spending.
Depressed yet, young people? We’re the ones paying the bills for this crap. I guess we should have seen the Republican evolution on Medicare coming. Demographic trends are making the GOP the the party of older America, and it isn’t like their whoring out on this issue hasn’t been evident ever since Dubya’s disgusting, unnecessary, crippling Medicare Part D entitlement became a reality.
4. Taxes won’t be raised much (do the Dems seem to have great love for reversing the Bush tax cuts?), spending won’t be cut enough (the recent Republican document is extremely weak), and within twenty years we will have a sovereign debt crisis in the United States, as one day a Treasury auction won’t go well. I’ll predict, but not favor, the emergency passage of a VAT, a’ la TARP, which will restore fiscal stability but lower the long-term rate of growth. When that time comes, the VAT will indeed be necessary, though ex ante I would opt for less social protection and a higher rate of economic growth.
H0-hum, it just got worse. A sovereign debt crisis in America? What is this, a banana republic? But I don’t think Tyler’s too far off target, given the way we’re spending and the lack of political will we have for reversing that trend. Can you see Americans ever buying into the sort of austerity the Irish are phasing in right now? The one thing I sort of don’t like is that he seems resigned to accepting a VAT, even though he (like me) favors less social protection, i.e. lower spending. Don’t give up the fight, Tyler! Don’t let the “serious” people win on the VAT. Let’s reckon with the spending now, rather than postponing it again with a VAT.
6. We should try to take back many of our vanquished civil liberties. Such a fight may or may not succeed, but at least fiscal considerations won’t rule out this counterblow for liberty.
Replace “many” with “all” and I am yelling “Hallelujah!” from the back of the room. Unlike bad spending and debt, you can’t just repudiate eroded/destroyed civil liberties. This boat has to get turned around immediately–if it’s not already too late, it will be soon.
12. In the meantime, the United States will experience an ongoing “late” period of cultural blossoming, driven by the proliferation and democratization of new electronic media.
Hey, optimism! The democratization through electronic media thing is huge, though. It’s entirely changed journalism. I wouldn’t be here without it.
I hope Tyler is wrong. I’m not much of a patriot, but it’s not like I want to see America fail. I’d love to see this country get back on the rails. But the thing is, the disagreements I have with him tend to be the result of him being too much of a realist. I don’t think his predictions will be far off target.