For the six years that Doug Elmendorf was director of the Congressional Budget Office, he worked hard to explain the policy choices that members of Congress confronted without telling them what he thought they should do.
Mr. Elmendorf is no longer at CBO. He is a visiting fellow in Economic Studies at the Brookings Institution and free to speak his mind. So we put a dozen questions to him and, displaying the talent for crispness and clarity that won him admirers on Capitol Hill, he answered each in a couple of minutes.
You can watch the entire series of videos here, but here’s a taste:
“Are deficits and debt the biggest problems the U.S. faces today?” we asked.
No, the former CBO director said. “The biggest economic problems we face are slow growth of the economy as a whole and the fact that over the past few decades many people in the lower and middle parts of the income distribution have benefited very little from the growth in overall output and income,” Mr. Elmendorf said.
“But,” he added, “we still should be worrying about deficits and debt—for the long run. It’s not the size of today’s deficits; it’s the amount of federal debt we accumulated in the past several years and the projection of rising deficits in the long-term that are the sources of concern.”
And how best to restrain those future deficits? Target the affluent, Mr. Elmendorf said.
Many Americans across much of the income distribution have benefited “very little” from the growth that the U.S. economy has enjoyed, he said. So Congress should protect “people of modest means” from the inevitable cuts in federal spending and increases in federal taxes. That “means not making big across-the-board cuts in benefits, for example for Social Security, because those benefits are especially important for people who don’t have a lot of private income and wealth.”
“We should impose most the burden on the affluent,” he said. They have benefitted the most from the growth in output and incomes over the past few decades.
Mr. Elmendorf will become dean of Harvard’s Kennedy School of Government in January.