The six-for-six compromise
"Deficit reduction and short-term job creation are not competing priorities," writes John Irons in this memorandum (pdf) for the Economic Policy Institute. "Job creation is needed today to ensure a strong economy and a solid tax base tomorrow: you can't reach reasonable budget targets without a strong and rapid recovery, and you won’t get a strong recovery if you pursue austerity too early."
To that end, Irons suggests a very simple "6-for-6" trigger to help time deficit reduction: Austerity measures should begin when the unemployment rate falls beneath six percent and stays there for six months. That makes sense to me, and you could even decide those measures in advance and write the trigger into law. The sensible compromise has been, and remains, a combination of short-term stimulus and relief spending and longer-term deficit reduction. Using a trigger to make that compromise credible is a sensible way to structure it. And you could please Satan by finding $600 billion in deficit reduction and calling it the "triple-six compromise."
August 2, 2010; 4:51 PM ET
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