Missing in Action: Growth

Neither party denies that our growing debt is rapidly taking us in the wrong direction, but neither party is giving the best remedy—economic growth enhancement—the top billing it deserves.

In the economic policy debate, there are two elephants in the room: The size and growth of our national debt, and the size and growth of our national economy. They belong together; when we address one, we should address the other at the same time. Unfortunately, that hasn’t been happening.
At the Republican convention, the size of the national debt received top billing—but it was headlined in isolation, when it should have been displayed in tandem with the size of the national economy. By contrast, the Democratic convention essentially ignored the debt. Although both parties gave honorable mention to economic growth, the Republicans’ top priority was to highlight the bad things their opponents have done to the debt, while the Democrats’ priority was the divide-and-conquer strategy of pointing out how much better off the middle class would be under their leadership.
Nonetheless, the size and growth of our overall economy deserves more attention than the debt, and more attention than the middle segment of our society’s income distribution. Why? Because the larger our overall economy, relative to the debt, the less of a debt problem we face, and the better off all income classes will be. Sufficient growth solves many problems, and that is why it deserves top billing in the policy debates. (This has been the subject of previous essays of mine, such as “What Does Fiscal Responsibility Mean?” and “The Debt Ceiling Distortion,” but the theme is worth repeating.)

Read more: http://www.american.com/archive/2012/september/missing-in-action-growth