FSG Blog
January 14, 2013

400-Word Scenario #10: Fiscal Ramp to Prosperity

February 14, 2013 [Wolf News/MSDNC]: In a Valentine’s Day miracle, Congress and the administration today reached a long-term deal on the debt ceiling, taxes, and fiscal reform.

A group of rogue bipartisan realists from perfectly safe seats – the Washington DC and Guam delegates and the observer team from McMurdo Station, Antarctica, spurred along by a contingent of visiting Marines and Seal Team members glowering down from Senate and House galleries, publicly wondering exactly what they have been risking their lives to preserve – have brokered a deal to end the budget logjam. 

The basis of the deal was the realization that the American economy is not a predictable hydraulic system that responds immediately to policy changes, but rather an organism governed by complex feedback mechanisms. 

The solution? Base the deal not on absolute values of deficits, debt or anything else, but upon observed growth of the U.S. economy and agreed ceilings for taxes and floors for spending. If the economy grows, then austerity measures (tax hikes and budget cuts) can be gradually ramped up as the economy is able to handle them. If the economy fails to grow, then tax hikes will be postponed and spending will remain at current levels. If it slumps, taxes are cut and spending rises.

“No one will lock in serious long-term decisions that benefit the economy until they are sure they will not be slammed suddenly by some policy reversal that might cause a Great Depression,” said a spokesman (or -woman) from the compromise group. (Members of the bipartisan realist group had taken to wearing burqas and using scramblers to disguise their voices to avoid partisan retribution.)

“The solution is to design dynamic policies that take into account the response of the economy. If the economy grows a little, we can keep taxes and spending where they are. If it grows more, we can raise taxes a little and cut spending a little. Companies and taxpayers can be sure that we are not going to raise taxes to the agreed ceiling, nor are we going to cut spending to the agreed floor, until the economy is truly booming. And the great part is that the whole thing will be based on strictly nonpartisan government statistics!”

In a possibly related story, the commissioner of the Bureau of Labor Statistics was reported to have driven his car off a Grand Canyon cliff at great speed. 

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5 thoughts on “400-Word Scenario #10: Fiscal Ramp to Prosperity”

  1. “Strictly non-partisan
    “Strictly non-partisan government statistics” — I sense some degree of skepticism…either that these exist…or that the nation as a whole would accept them. Which is it?

    • Personally, I would say more
      Personally, I would say more the latter. Although there will never be perfectly non-partisan statistics, the problem is far more in public misunderstanding of how insulated from politics the data-gatherers of the Bureau of Labor Statistics, for example, are.

  2. I wonder if “economic growth”
    I wonder if “economic growth” is the right dependent variable in this post-cold-war world.

  3. Perhaps “Reality Television
    Perhaps “Reality Television Viewership” would be a better metric. Although they are obviously correlated.

    (More seriously, some measure of livelihood creation – not mere raw jobs, but something that takes into account the quality of the job – would work better.)


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