Bill Bradley Joins the Announcement Effect Club
Already a member of the Basketball Hall of Fame, former Sen. Bill Bradley (D-NJ) joined another exclusive club over the weekend: the Announcement Effect Club. His comments came during an appearance on Meet the Press yesterday (see here for a full transcript).
SEN. BILL BRADLEY:
Sure. Well, that's one of the reasons I wrote the book, to try to give people some hope that we can deal with our problems. Yeah, the private sector, non-financial corporations, have $1.8 trillion on their books in cash and in liquid assets. If 20% of that was used to hire people, the unemployment rate would be 5%. When you ask CEOs, "Why don't you do that?" They say, "Because of uncertainty." You heard that earlier today.
SEN. BILL BRADLEY:
And, "There's no demand." So you've got to address those two things. You address the uncertainty with deficit reduction and demand with a massive infrastructure program. Immediately what you do is you say, "If you hire another worker, the government will pay 30% of that, as long as you don't lay off a worker." And do that for two years, limited to $50 billion, not a taxpayer dollar would be spent unless a job was created. Do that immediately, then you get the private sector hiring with the combination of deficit reduction and massive infrastructure, I'm talking about a trillion dollars, to create five million jobs.
The Announcement Effect Club expresses the idea that there is no inherent contradiction between supporting the economy in the short term and enacting a deficit reduction plan now. Sen. Bradley advocates being aggressive on the first part and also argues for the benefits that the second part will bring even in the short term as increased certainty aids the recovery. If deficit reduction is phased in very gradually, it can be a help to the recovery before it takes effect.