Buttigieg: 'Generational' Pain Awaits If Debt Is Ignored
Pete Buttigieg, the millennial mayor with an unusual last name, is unique.
He is the youngest of the Democrats lining up to challenge President Trump in 2020. He is often more pragmatist than progressive firebrand. And he is making his campaign about “intergenerational justice.”
This means the mayor of South Bend, Ind., weighs policy debates in terms of the short term versus the long term. And this has led him to weigh in on a topic the rest of the field apparently would rather avoid: the ballooning national debt.
“It is a problem, and it is a problem that has to be taken seriously,” Buttigieg told RealClearPolitics. “I think a lot of policy decisions seem to be made with the expectation that the consequences are someone else’s problem. But the younger you are, the more it is our problem.”
That includes Buttigieg (pronounced Buddha-judge), who turned 37in January.
The national debt topped the $22 trillion mark this month, the highest total ever, despite continued economic growth and despite (or perhaps because of) the general indifference of both political parties.
More than $2 trillion of that total has been added since Donald Trump took office. The rest was racked up under his predecessors, particularly President Obama, under whom the debt doubled.
Director of the National Economic Council Larry Kudlow told reporters last week that the president is “concerned” by the situation. And he promised that the White House will release a plan to reduce federal spending. But so long as growth continues, Kudlow said, the borrowing is not “a problem.”
Buttigieg disagrees, slamming an administration that he believes has “divorced its debt policy from the macro-economic reality.”
Debt isn’t a problem during downturns, he asserts, referring to it an “economic tool in the toolbox,” so long as down payments are made during times of growth.
“What is extraordinary is to do massive tax cuts for the wealthiest, blowing up the debt in the context of an economic recovery where you didn’t need that stimulus in the first place and no one was even asking for it,” Buttigieg says.
While Democrats love to loathe the Trump tax cut in similar terms, what makes this millennial unique is the next part of his comment:
“That’s the kind of irresponsible decision that has a both a very unfair distribution affect within the moment and also winds up effectively telling middle-class people my age that we are going to be subsidizing the wealthiest people today for the rest of our lives.”
His criticism, in this regard, is bipartisan. While Buttigieg knocks Republican tax breaks, the municipal leader acknowledges that “even mentioning deficits and debt is pretty unfashionable on the left.”
“But like many other issues, from national security to climate change,” he continues, “things have reached a point where if we don’t take them up, nobody will.”
At least for now, other Democrats aren’t having that conversation. Many in the 2020 field have proposed tax increases. But they would reverse the Republican cuts in order to combat what they consider inequality, not to balance federal budgets. Candidates also are more likely to endorse massive government funding projects like the Green New Deal, recently proposed by Rep. Alexandria Ocasio-Cortez.
Buttigieg is also on board with the goals of that plan, if not the specific policy prescriptions, which even Ocasio-Cortez admits would require spending and mobilization on “a scale not seen since World War II.”
Democrats can be for both fiscal responsibility and environmental stewardship, he insists: “What’s the alternative? Some of these concerns don’t account for the very real dollar costs, not to mention the very real human costs, of business as usual.
“Yes, it involves investment and, yes, it is going to put pressure on our balance sheets as well, but what’s really going to put pressure on our balance sheet is the kind of economic and human harm -- potentially even a collapse -- that will come from failing outright with the climate crisis before it reaches even greater proportions.”
So how would Buttigieg deal with the debt?
He calls for investments in infrastructure and education to boost productivity. He adds that a lot of debt reduction “can happen on the revenue side where people are not paying their fair share.” He also mentions a financial transactions tax.
Eventually future taxpayers are going to have to pay for the spending of past generations. Something will have to give when creditors come calling. Democrats, Buttigieg says, better have an answer.
“If we want to be credible, that we care about the long term -- which is why, in my opinion, we talk about things like climate change -- then we also have to demonstrate that we are serious about the fiscal situation of the U.S.,” he argues.
“It doesn’t have to mean some kind of knee-jerk opposition to the use of debt, which is a very important part of our fiscal toolkit. It does mean having something -- just something -- when it comes up as an issue.”