Olugbemisola Rhuday-Perkovich

Nancy Folbre is an economics professor at the University of Massachusetts Amherst.

I’m not sure who invented the term “deficit hawk,” but it seems an odd name for a creature too chicken to raise taxes. The bird is strange in color, too — in Republican red, Democratic blue or Blue Dog purple.

Most politicians refused to get specific about the federal budget until after the election, then stood around waiting for bipartisan groups to stick their necks out. We have now heard from the chairmen of President Obama’s bipartisan deficit reduction commission and the Bipartisan Policy Center, and the feathers are flying.

Both plans propose cuts in taxes on individual and corporate tax rates, counterbalanced by elimination of some big tax breaks. Both also propose taxing at least one liquid whose consumption we want to discourage: gasoline or sugary drinks. The Bipartisan Policy Center would also impose a 6.5 percent national sales tax.

Both plans also propose cuts in military spending, Medicare and Social Security.



A concise overview in USA Today described the response this way: “near-unanimous opposition from right and left.” While this characterization seems accurate, it elides important differences in the reasons for opposition.

Most critics on the right don’t like the proposed tax increases; most on the left argue that we shouldn’t obsess about the budget until we get the unemployment rate down and the economic growth rate back up.

In other words, both plans to cut the deficit are hawkish, and the response to them largely represents hawks revealing their inner chickens.

Many discussions of the deficit frame the issue primarily as tax increases versus spending cuts. The New York Times published a “deficit puzzle” last week that enables readers to pick and choose from both sides of this ledger, deciding how to reduce the projected deficit for 2030 by about $1.3 trillion, by coloring in blocks representing $1 billion each.

It’s an educational exercise that helps focus attention on specifics, even if one disagrees with the way some of the specifics are framed. I’ve handed it out to my undergraduates, asking them to write a brief essay defending their choices.

But I would prefer a different framework, one that sorts proposed policies according to their distributional impact: Who will benefit, and who will be hurt?

In some cases, the distributional impact is obvious: Allowing expiration of the Bush tax cuts on income above $250,000 will primarily hurt families at the very top. Also, we know that low-income families depend more heavily on Medicare and Social Security than others and would be likely to be hurt most by cuts there.

Some proposed tax increases – such as a national sales tax or a tax on carbon emissions (unaccompanied by any compensatory transfers) – would also hit low-income families very hard. And many proposed spending cuts would affect families, who are, for instance, major beneficiaries of Medicare spending.

Indeed, the conservative critique of spending programs is most powerful when it calls attention to public subsidies of “McMansions and gold-plated insurance plans,” as Ross Douthat wrote in an Op-Ed column in The New York Times on Nov. 14.

The distributional impact of some proposals is hard to ascertain. Over the last five years, many young people have entered the armed forces in part because they couldn’t find a decent civilian job. How will cuts in military spending, then, affect the unemployment rate?

The effect of reducing the tax break for employer-provided health care depends largely on the as-yet-uncertain future of a much larger package of health care changes.

In my experience, most college seniors can’t accurately define a regressive tax (one that takes a larger percentage bite out of low incomes than high ones) and even fewer realize that the regressive structure of state taxes largely counterbalances the progressive structure of the federal income tax.

This leads me to believe that most voters don’t have a clear idea of how current proposals for deficit reduction will affect them personally.

Several different Web sites provide great tools for unpacking the federal budget, including those provided by the Center for Economic and Policy Research and the National Priorities Project.

Has anyone out there designed a simple model that could provide the basis for a Web-based calculator allowing individuals to enter their personal and family characteristics and get answers to questions like: Where do I sit in the income distribution? How are these policies likely to affect my pocketbook?

Such a calculator could help raise the level of public debate. It could also help voters see what’s going on underneath the feathers.