28-year-old former bartender Alexandria Ocasio-Cortez’s recent stunning victory over Democratic leader Joe Crowley in the primary for New York’s 14th congressional district made her an instant political superstar.
She’s appeared on “Meet the Press,” fielded hundreds of interview requests, and been touted as the new face of the Democratic Party. A former Bernie Sanders activist, she is a self-proclaimed socialist whose mission seems to be to save these discredited ideas from the dustbin of history.
Never mind that she won a majority Democratic district with a turnout of a miniscule 12%. And it doesn’t matter that mainstream Democrats have Berniecrats badly beaten in many races across the country.
‘Galaxy shimmered’
The media, especially the New York Times, went crazy over Ocasio-Cortez. Jaded columnist Maureen Dowd, seemingly bored to tears by decades of family dynasties like the Bushes, Clintons and Trumps, said “through this dark miasma, a little corner of the galaxy shimmered, offering hope” . May the Force be with you, Maureen.
Progressive columnist Michelle Goldberg proclaimed: “Millennial Socialists Arrive.” Even former editor Jill Abramson called her former journal “narcissistic”, saying that “missing [Ocasio-Cortez’s] ascend [is] like not seeing Trump’s victory come in 2016.” Earth to Jill: Huh?
But Times columnist Paul Krugman gave the new political phenomenon the ultimate imprimatur, with all the seriousness of his Nobel Prize in economics. In a column titled “Radical Democrats Are Pretty Reasonable,” he particularly praised Ocasio-Cortez’s support for a job guarantee for all working-age Americans, writing, “It’s a response to real problems, and that’s not a crazy idea at all.”
Yes, a crazy idea
With all due respect, Dr. Krugman, this is a crazy idea and the sum total of his platform is madness on steroids.
I’m pretty sure few NY 14 voters have read this document, just as most Trump voters haven’t delved into his policy positions. People vote mostly on instinct, and voters saw both Trump and Ocasio-Cortez as agents of change, albeit in radically different directions.
But several potential 2020 Democratic presidential candidates, including Sanders and Senators Elizabeth Warren of Massachusetts, who co-sponsored Sanders’ “Medicare for all” invoice; New Jersey’s Corey Booker; Kamala Harris of California; and Kirsten Gillibrand of New York; approved big chunks of it (the job guarantee plus a national minimum wage of $15 an hour, Medicare for all, and free public college tuition for all). So by the time voters head to the polls in November 2020, this could be Democratic orthodoxy.
It’s too bad, because not only do these radical plans have no chance of passing a very polarized Congress; those are really bad ideas. Why?
Short of money
Mainly because, repeat after me, we just can’t afford them.
Let’s start with Medicare for All. Haven’t any of these politicians read the recent report from Medicare and Social Security trustees that the Social Security trust fund will run out of money in 2034 and the Medicare fund will become insolvent d by 2026? The truth is, with 10,000 baby boomers turning 65 every day by 2029, we can barely afford fluent program, not to mention extending it to the entire population.
But if we did, that — and free public tuition, when barely a third of Americans have a four-year college degree — would add $32 trillion to the national debt over the next decade ( or just $18 trillion if Sen Sanders’ 2016 tax increases on the wealthy were also passed to pay for some of that), according to the Tax Policy Center.
That’s more than 10 times more than recent Republican tax cuts to its big corporate donors are expected to rise over the next decade and would, at the very least, more than double the national debt in public hands. which is currently over $15 trillion.
Plus, thanks to a debauched GOP, we’re going to see trillion-dollar annual federal deficits for years to come. These plans could easily triple these annual gaps.
Howard Gleckman of the Tax Policy Center estimated that Sanders’ original plan would add $3 trillion in interest costs, calling it “an unprecedented increase in government borrowing.” By the way, the Tax Policy Center is not a right-wing think tank; he is affiliated with the left-of-center Urban Institute and Brookings Institution. But their economists know how to add and subtract.
Krugman estimates the guaranteed jobs proposal — which comes as the unemployment rate hits multi-year lows — would cost about $270 billion a year. Former Democratic Treasury Secretary Lawrence Summers puts the cost at $840 billion a year. And what would all these people actually do with their taxpayer-subsidized jobs?
Add the maraschino icing to that rich cake — Ocasio-Cortez’s plan to cancel all student debt — and you’ve got another trillion-plus goodie. A trillion here, a trillion there, and soon it’s real money.
Total price: $20 trillion to $40 trillion over 10 years, depending on how much tax would have to be raised to pay for all of this.
Since the election, Democrats have been desperate for “big ideas” to defeat President Trump and Republicans at the polls. But these insane schemes are not that.
It turns out that socialism is not cheap.
Howard R. Gold is a MarketWatch columnist and founder and editor of GoldenEgg Invest, which offers exclusive market commentary and simple, low-cost, low-risk retirement investment plans. Follow him on Twitter @howardrgold.
