If any part of President Biden’s speech Wednesday night should make Utahns feel good, that’s it.
It’s been a long time since family values dominated any party platform in the capital.
Of course, the family measures Biden outlined in his American Families Plan would cost $1.8 trillion, added onto his $2.3 trillion “infrastructure” plan, which would be added onto the $1.9 trillion pandemic relief bill he already got Congress to pass, which was added to earlier stimulus bills, which … you get the idea.
A lot of economists think the nation is on the verge of an economic boom. In a recent letter to shareholders, JPMorgan CEO Jamie Dimon said all the pent up savings and government spending from the past year is going to fuel good times. “This boom could easily run into 2023 because all the spending could extend well into 2023.” he wrote.
But this is ready to happen now, without the trillions more in infrastructure or the family plan. Even the president acknowledged, “America is on the move again.”
Yet, a theme of Biden’s speech seemed to be that government is better suited to efficiently solve our problems than the private sector. That’s a premise I don’t think most Utahns buy into.
Although, to be fair, it was the unstated premise when Republicans controlled things and spending increased, as well. At least Biden has a plan to pay for some of this, although taxes on the wealthy aren’t going to cover all the overspending. They can’t begin to fill the hole the nation is in.
Utahns, with the nation’s fastest growth rate over the last decade, and with an unemployment rate of 2.9%, ought to be worried about this. Folks in Washington are acting as if debt doesn’t matter, or as if the old rules of economics are outdated.
Michael A. Peterson, Chairman and CEO of the nonpartisan Peter G. Peterson Foundation, which looks for ways to address the nation’s fiscal challenges, put it this way in a recent web post:
“Federal borrowing competes for funds in the nation’s capital markets, thereby raising interest rates and crowding out new investment in business equipment and structures. Entrepreneurs face a higher cost of capital, potentially stifling innovation and slowing the advancement of new breakthroughs that could improve our lives.”
Interest rates are low right now. They have been for years. That makes it easy to service all that federal debt. But raise those rates just a little, and things change. With the exception of a pandemic slowdown, Utah’s economy has been booming for a while now. But it can’t withstand strong counter winds from Washington.
Some spending is needed. The White House recently rated Utah as having the best infrastructure in the nation. But it got only a C-plus grade. The state has 62 bridges and 2,064 miles of highway in poor condition, the administration said. Its water system needs $4.4 billion in improvements and 17% of its trains and buses should be replaced.
A good infrastructure plan could help that, but if the nation hits a financial wall, few people will be fixing anything.
Biden spoke about a lot of other things, as well. Americans should be happy that vaccinations are plentiful. We should be tough against foreign aggressors. We need to pass immigration reform, especially for the children of undocumented immigrants.
Americans should be thankful soldiers are leaving Afghanistan, and they should pray that events don’t force them to go back again.
But if anything, Afghanistan reminds us of America’s role in the world, and why it must remain economically strong enough to respond to threats whenever and wherever they come.
Getting back to JPMorgan’s Jamie Dimon, he said we won’t know how long the coming boom lasts until “we see the quality, effectiveness and sustainability of the infrastructure and other government investments.”
Then he added, “I hope there is extraordinary discipline on how all of this money is spent.”
Do you trust politicians to do this?
And yet, as I said, at least people are talking about families.
The latest Census data, released this week, shows why that is important. During the last 10 years, America’s population grew by less than at any time in history, with the exception of the Depression-laden 1930s.
Fertility rates in the United States, and even in Utah, are below replacement levels. The marriage rate has gone
from 9.8 marriages per 1,000 people in 1990 to 6.1 in 2019, according to statista.com.Unless this trend is reversed, future generations face serious economic consequences.
I don’t know if universal preschool, limits on out-of-pocket child care or higher Child and Dependent Care Tax Credits will make their way into law. I don’t know if anyone has good ideas for promoting marriage and families.
But I do know it’s time Washington started debating these things and searching for other answers — while we all keep a wary eye on our wallets, of course.