What's important to you? Where will you steer us?

March 8, 2017 2:34 PM

But budget decisions aren’t only about fiscal sustainability. They also shape the kind of country we live in. To win the game, you need to find a combination of policies that match your values and priorities AND set the budget on a sustainable course. How do you get people to understand the difficulty of balancing the federal budget with national values? How do you get people to see the long-term budgetary effects of policy decisions... and more importantly, how the hell do you get people to care? Turn it into a game.
posted by sciatrix (44 comments total)

Spoiler alert; if you slash the military funding (apparently not even all that drastically?) you can pay for just about whatever the fuck you want.
posted by furnace.heart at 2:52 PM on March 8, 2017 [28 favorites]

Raising taxes on the rich doesn't hurt, either.
posted by Lycaste at 2:58 PM on March 8, 2017 [9 favorites]

I don't like the framing of "debt is out of control!!!" It's not, and their fiscal goal is nonsense. It'd be fine to say "try to keep the debt-to-GDP ratio under 150%", but there is no reason to keep it at current levels.

Still, I enacted a bunch of progressive policies and got within 93% of their goal. Dirty secret: raise taxes. I wish they had an option to raise 'em to 1960s levels.
posted by zompist at 3:01 PM on March 8, 2017 [25 favorites]

That's was pretty fun! Here's my plan, which raises 2042 revenue 18% of GDP from the baseline, while raising spending modestly (2.3%).

Largest tax measures:

• Impose a value-added tax
• Eliminate cap on wages subject to payroll tax
• Impose a carbon tax

The hard part, of course, is coming up with a package that you can actually get consensus on.
posted by russilwvong at 3:10 PM on March 8, 2017

There is a brilliant computer game that actually simulates this - Democracy (wiki link) which has been around since 2005 with two sequels. It's a much larger game than just balancing the budget, but money remains an overriding concern (you can pretty much please your entire electorate if you have unlimited money, or at least bribe them enough to not care about your other policies). There are multiple voting blocs - capitalists, liberals, socialists, greens, conservatives, religious, atheist, multiple income and age levels, habits like smokers / drinkers, and they overlap in different ways (eg, poor socialist drinker) and you have to break down the problem and figure out the most efficient way to reach 50% support to win re-election. You gain political capital by appeasing power blocs in government and can turn around and spend that political capital on changing policies.
posted by xdvesper at 3:21 PM on March 8, 2017 [7 favorites]

The tax measures I picked were primarily aimed at efficiency (value-added tax, carbon tax, increase to gas tax, a cut to tax on international profits) and greater progressiveness (higher taxes for wealthier households); expanding unemployment benefits, boosting Social Security for low-income workers, and providing two years of free community college also fall in the progressiveness bucket. I didn't cut military spending at all; in fact I increased foreign aid, Homeland Security, and spending on veterans. There were measures to cut spending on drugs, and to boost spending on the FDA and on health research. And finally there was increased infrastructure spending (probably the only thing we can actually get consensus on!).

Overall effect: reduced debt levels by 115% of target.
posted by russilwvong at 3:22 PM on March 8, 2017 [2 favorites]

I love the idea, but am finding myself super frustrated actually playing it. It doesn't include a lot of conservative ideas to reduce spending, which I'm sure is by design, but it makes you feel like the game is rigged. I'm not even sure there's a need to do that, you could easily stack negative consequences on in the "endgame", but the inability to even choose to, say, reduce SSI is frustrating.
posted by corb at 4:11 PM on March 8, 2017 [2 favorites]

Fun! The USA seems pretty easy to save on paper. What's the holdup?
posted by michaelh at 4:28 PM on March 8, 2017 [4 favorites]

Also I totally want a 25% flat tax instead of the crazy 15% one! Le sigh. But the animations are super cute!
posted by corb at 4:33 PM on March 8, 2017

How do you get people to see the long-term budgetary effects of policy decisions...?

I'm more concerned with how you get people to see the long-term policy effects of budgetary decisions, myself personally.
posted by eviemath at 4:46 PM on March 8, 2017 [3 favorites]

I love the idea, but am finding myself super frustrated actually playing it. It doesn't include a lot of conservative ideas to reduce spending ...

It's not like they were any better on progressive ideas. There isn't any option to change the tax structure to a flat tax on utility (as opposed to nominal dollars) with no brackets. There isn't any option (unless I missed it) for taxing all capital gains like ordinary income. There is no fine-grained control on things like increasing the estate tax or setting the rate for a carbon tax. There is very little control on healthcare: no single-payer option, no national healthcare provision option, etc. And again, no fine-grained control. There is nothing about providing basic income (even though that's been supported by both conservatives and progressives). Nor was there any fine-grained control on reducing military spending: "cut the army by 50%" is not nuanced.
posted by Jonathan Livengood at 4:50 PM on March 8, 2017 [13 favorites]

Seriously this was extremely easy to do and most of it was just stop building submarines and aircrafter carriers
posted by The Whelk at 4:53 PM on March 8, 2017 [7 favorites]

The game may not provide fine-grained control, but I thought it did a good job of showing the magnitude of policy changes. "Cut foreign aid" isn't going to make much difference, compared to "lift the cap on payroll taxes" or "bring in a value-added tax."

I'm assuming that each of the policies in the game corresponds to a proposal that someone's actually put forward. Unfortunately I think if you filtered them for political feasibility (what can you actually get consensus on?), you wouldn't have much left!
posted by russilwvong at 5:13 PM on March 8, 2017 [3 favorites]

Cut the army in half AND ramp up ship building? Yes, please!
posted by the man of twists and turns at 5:14 PM on March 8, 2017

Arguments Against... If the USA doesn't have more aircraft carriers than the entire rest of the world combined, will our allies still respect us? What if we want to "negotiate" with Iran? And the new carriers are far cheaper to operate than the old ones; why, at these prices it'd be fiscally irresponsible not to double the aircraft carrier budget.
posted by sfenders at 5:18 PM on March 8, 2017 [2 favorites]

"I love the idea, but am finding myself super frustrated actually playing it. It doesn't include a lot of conservative ideas to reduce spending, which I'm sure is by design, but it makes you feel like the game is rigged. I'm not even sure there's a need to do that, you could easily stack negative consequences on in the "endgame", but the inability to even choose to, say, reduce SSI is frustrating."

Uh, the whole thing is based on a conservative anti-government idea that the size of the debt is a real policy concern at any time in the near future, instead of recognizing that the money multiplier that comes from state investments in many, many areas (science, education, infrastructure, welfare, etc.) means that because interest rates are so cheap now, racking up more debt isn't that big a deal. This could change if inflation shifts, but since there are even credible calls for negative interest rates at central banks to undo the damage of austerity, that's something that is pretty unlikely at the moment.

It also gives some pretty misleading arguments on economic growth, like that lower taxes encourage it. Higher taxes discourage growth beyond a certain equilibrium point, but that point is, like, somewhere in the effective 70% range. Cutting taxes below that point doesn't actually seem to do very much to promote growth, empirically.

"Also I totally want a 25% flat tax instead of the crazy 15% one! Le sigh. But the animations are super cute!"

Flat taxes are the epitome of policy that is clear, simple and wrong. The marginal utility of the dollar matters; that we're essentially a consumer economy matters. The tax disproportionately falls on poor and middle class people due to marginal utility, and therefore discourages the broad-based consumption that drives our economy. It's something that seems "fair," but has unfair effects, and would only really benefit the Steve Forbes of the world.
posted by klangklangston at 5:34 PM on March 8, 2017 [23 favorites]

Yeah, all this is super-easy if you're a God-Emperor who doesn't have to give a shit what anyone else thinks.
posted by ROU_Xenophobe at 5:39 PM on March 8, 2017 [1 favorite]

The introductory article seems reasonably technocratic (it's Brookings, not Heritage). It mentions that interest rates are currently low, and that it may make sense to borrow more at the moment:

... many of my colleagues know, well, everything about the federal budget. They’re worried not so much about today’s budget deficit; indeed, some would borrow at today’s low interest rates to give the slow-growing U.S. economy a boost right now. Instead, they’re worried about projections that show the federal debt rising inexorably over the next couple of decades.

posted by russilwvong at 5:39 PM on March 8, 2017 [1 favorite]

The game may not provide fine-grained control, but I thought it did a good job of showing the magnitude of policy changes.

Completely agree.

I'm assuming that each of the policies in the game corresponds to a proposal that someone's actually put forward. Unfortunately I think if you filtered them for political feasibility (what can you actually get consensus on?), you wouldn't have much left!

This looks right, too. :(
posted by Jonathan Livengood at 5:43 PM on March 8, 2017 [1 favorite]

In a parliamentary democracy, you can imagine a majority government putting together a package of policy changes (tax increases and spending cuts to stabilize the debt level, perhaps with some tax cuts and spending increases).

In the increasingly polarized American political system, though, finding a compromise seems more and more impossible. So we get paralysis and drift.

Assuming Brookings is correct in saying that long-term debt levels are a serious problem, but it's impossible to build a consensus on what to do, what's going to eventually happen? A few weeks ago, Paul Krugman referred to a classic paper: Dornbusch and Edwards, The Macroeconomics of Populism (1989). It makes for interesting reading.
posted by russilwvong at 6:42 PM on March 8, 2017 [2 favorites]

So... Facebook friends who are econ types (of the progressive bent) talk about this a lot. (MMT maybe ? ) I will cop to butchering their argument, and I think it's MMT and fiat money -- where does the money the gov't spends come from ? Most people would answer the gov't gets money from taxing people. They argue that isn't true. Rather, the government creates money by its own vested power. (money is just an instrument, etc)

Their point: why worry about a balanced budget ? Yes, there's worry about inflation, but depending on how the government gives out money, some spending is more inflationary than others, and tax policy controls inflation.

It comes across as compelling, but I feel woefully unable to parse it.
posted by k5.user at 7:23 PM on March 8, 2017 [1 favorite]

Flat taxes are the epitome of policy that is clear, simple and wrong

I mean, there's plenty of politics threads for us to fight over whether stuff is right or wrong. This is one about a cool game that may have some implementation problems.

I do like the fact that it shows kind of immediately how small or large a savings or increase is. There were a couple savings that I reluctantly made, but reversed when I saw how little they actually got me. I finally finished the game safely under the margin, but it did take a lot of fiddling!
posted by corb at 8:08 PM on March 8, 2017 [2 favorites]

I cut farm subsidies, and now Amy Adams in that West Wing episode is mad at me :(
posted by aedison at 11:28 PM on March 8, 2017

I tried to build a "Scandinavian model" but it couldn't be done within the game. A nice image of how also in real life, it's really hard to imagine a completely different organization of society.

That said, its a really neat game, and must be good for teaching purposes. Wasn't there one during the Bush years, too? I seem to remember doing better on that, maybe because there was more nuance.
posted by mumimor at 12:19 AM on March 9, 2017

I ran up the debt as much as I possibly could, hit "end game" and it displayed an dialog about an "unrecoverable error" and kicked me back to the start menu rather than show me the summary of my terrible policies.

Fair enough.
posted by vibratory manner of working at 12:33 AM on March 9, 2017 [1 favorite]

Most people would answer the gov't gets money from taxing people. They argue that isn't true.

It isn't. The Fed is explicitly charged with managing money supply. The popular ignorance about what money supply is and what a unit of currency "means" is part of what makes these problems intractable: imagine putting a bunch of jocks in charge of writing a complex mathematical proof, without any expert help, based only on their intuitions and received wisdom about what mathematical proofs are. That's sort of similar to our current problem: even a lot of better educated people don't think very deeply through ideas and problems.

If you look on the face of bills themselves, they'll tell you what they are: they are debt notes, generic IOU tickets issued by the federal government, that are supposed to represent a share of the overall economic wealth of the nation, the commonwealth. The point of the government creating currency, crudely put, is supposed to be to keep the number of IOU notes in circulation from growing too out of step with the actual value (goods, services, resources, etc.) produced in the economy.

Taxation in the American system is more about redistribution of surplus wealth, a problem even early free market theorists like Smith worried about, to prevent money from being horded and kept out of circulation in the economy where it can do the most good.

It actually makes all the difference in the world how we define and understand "money" whether or not we really know or understand the policy we're making, so even though that's the sort of problem people are likely to dismiss as "just arguing semantics"; I used to use that phrase a lot myself until I thought it through and realized that rebuttal is basically the same thing as saying "just arguing about the meaningful content of what we're saying," which of course is a legitimate part of what discussion and argument are for--if we don't actually consider the content of our arguments, but only their formal structure, when we discuss ideas, we're missing the point in a very serious way. Of course the semantic content of arguments matters.

Anyway, it's garbage in, garbage out. If politicians don't have a fairly clear, consistent, and coherent understanding of the basic ideas and concepts involved in our system, then of course it's harder to construct coherent policy. We need more critical theory and philosophy of economics, and less pretense any of these concepts are simple and have simple black and white relationships to unrelated kinds of economic activity we might know from common experience, like household budgeting.
posted by saulgoodman at 3:33 AM on March 9, 2017 [5 favorites]

*sigh* Another right-wing budget simulator. Where are the options for cannabis legalization? Elimination of the Social Security contribution cap? A punitive use-it-or-lose-it tax for property speculators? Hell, where are war bonds?
posted by Faint of Butt at 5:37 AM on March 9, 2017

Where are the options for cannabis legalization? Elimination of the Social Security contribution cap?

I basically agree with you, but the power of pendantry compels me to note that elimination of the social security cap is contained within their policy-button for eliminating payroll tax caps in general.
posted by ROU_Xenophobe at 7:12 AM on March 9, 2017 [2 favorites]

Eliminating payroll tax caps makes a pretty big difference in the 25-year projection.

k5.user: The MMT contention that deficits don't matter at all looks like wishful thinking. Paul Krugman explains.
posted by russilwvong at 9:06 AM on March 9, 2017 [1 favorite]

As did the VAT, which I used to strongly oppose but find myself conflicted if it actually brings in that much revenue. Definitely a great starting point for self examination!
posted by corb at 9:09 AM on March 9, 2017

corb: a VAT definitely seems like a good idea if you want to raise revenue (needed to close the deficit) in the most efficient, least distorting way possible. Stephen Gordon explains . We've had a VAT in Canada (the GST) since 1991.
posted by russilwvong at 9:17 AM on March 9, 2017 [1 favorite]

Where's the eliminate all income tax and replace with new Federal authority to print enough money to pay its way, but only on concrete goods and services that immediately get the new currency into as broad a circulation pattern as possible, so it doesn't pool up as surplus wealth and incentivize market bubbles and boom and bust cycles.

As long as every dollar printed paid a salary or paid for materials or infrastructure maintenance or even small-scale, broadly distributed rent payments, it would be backed by the direct creation of real economic value.

Where's the option to run that radical Keynesian scenario?
posted by saulgoodman at 9:31 AM on March 9, 2017

saulgoodman: Doesn't that lead to hyperinflation? Paul Krugman:

... there are limits to the amount of real resources that you can extract through seigniorage. When people expect inflation, they become reluctant to hold cash, which drives prices up and means that the government has to print more money to extract a given amount of real resources, which means higher inflation, etc. Do the math, and it becomes clear that any attempt to extract too much from seigniorage — more than a few percent of GDP, probably — leads to an infinite upward spiral in inflation. In effect, the currency is destroyed. This would not happen, even with the same deficit, if the government can still sell bonds.

posted by russilwvong at 9:42 AM on March 9, 2017

Not if every dollar was spent almost immediately and broadly distributed. Hyperinflation comes from currency not being pegged to new value creation. As long as it immediately creates real economic value--pays for a unit of labor, a widget, etc.--I don't think so. These wouldn't be cash drops, but working budgets that paid for real work and assets. Unless I'm ignorant about something here.
posted by saulgoodman at 9:54 AM on March 9, 2017

I mean, you could also impose limits on price gouging to mitigate that risk, I think.
posted by saulgoodman at 10:00 AM on March 9, 2017

Its no different than printing bonds, just more direct. Bonds are promises from the gov't to pay back bondbuyers with the yields from GDP growth resulting from some gov't expense or expenditure. The way the government pays those bonds back, eventually, is by printing new money. What I'm proposing is just a much straighter line to get the same effect, without investors being involved in raising the seed funds.
posted by saulgoodman at 11:53 AM on March 9, 2017

With the added side benefits of ending budgeting gridlock and ushering in a new kind of post scarcity economy better equipped to manage environmental problems sustainably.
posted by saulgoodman at 12:00 PM on March 9, 2017

That said, its a really neat game, and must be good for teaching purposes. Wasn't there one during the Bush years, too? I seem to remember doing better on that, maybe because there was more nuance.

Games like this have been around since at least the first Bush presidency. I remember downloading a completely text based DOS "budget simulator" from some government or policy think tank BBS. They even updated it a few times to add universal healthcare as a budget item, cover the new Republican policy proposals, and update the baseline to reflect changes in actual spending.

Even then, it was plainly obvious that the biggest savings were to be found in the defense budget. It also made it plainly obvious how little money there was to be saved in the grand scheme of the federal budget in the wrangling over welfare.
posted by wierdo at 2:56 PM on March 9, 2017

The MMT contention that deficits don't matter at all looks like wishful thinking.

If that were in fact the argument MMT adherents were making, Krugman would have a point. That isn't what they are saying, though. The argument is that deficits, in and of themselves, don't matter. The economic impact of the deficit can be managed through tax, trade, or monetary policy.

More fundamentally, they say that the deficit isn't what you think it is. In reality, so they say, the debt is a relatively meaningless accounting of the benefit we have accrued from decades of trade imbalance. In other words, it simply puts a number on all the free shit China and other countries have been giving us over the years. So long as the dollar remains the world's reserve currency, it is completely irrelevant. Maintaining the dollar's status is what we should be worrying about, not the size of the deficit or debt.
posted by wierdo at 3:06 PM on March 9, 2017

A lot of that debt is basically bond debt to China isn't it? So why go through such a slow complicated process to create money supply? Who benefits other than big institutional investors from not simply increasing the money supply and using it directly to create GDP growth now, instead of projecting hypothetical, future GDP growth and counting on that to justify the increase in money supply down the line?
posted by saulgoodman at 3:51 PM on March 9, 2017

I think it's primarily because it makes people feel good. Back when we were on the gold standard and therefore had only crude control of the money supply that is how it was done, so we keep doing it that way to protect the feels of people who think money should be backed by something tangible.

Note that the Fed also doesn't just helicopter drop money into the system. They buy assets in exchange for the money they inject.
posted by wierdo at 6:52 PM on March 9, 2017

UBI paid via direct citizen accounts at the central bank could improve financial stability, enable demand stabilization (via)
posted by kliuless at 8:32 PM on March 9, 2017

okay but where's the button to nationalize all key industries huh tell me that
posted by You Can't Tip a Buick at 4:10 AM on March 10, 2017 [2 favorites]

that's what a citizen's dividend is! a share in the productive capacity of a nation :P
posted by kliuless at 6:59 PM on March 10, 2017 [1 favorite]