Steven Rattner | Washington Should Quit Its Budget Gimmicks – The New York Times

Mr. Rattner served as counselor to the Treasury secretary in the Obama administration.

“Americans of a certain age may remember J. Wellington Wimpy, a droll character from Popeye cartoons. “I’ll gladly pay you Tuesday for a hamburger today,” Wimpy would periodically implore passers-by.

That pretty much summarizes the opaque budget math behind the two huge spending plans now before Congress, one aimed at fixing our physical infrastructure and the other targeted at everything from child care to the climate crisis.

Unlike earlier pandemic rescue efforts, Democratic leaders have promised that these new bills would not add to the country’s enormous deficits. “It is zero price tag on the debt,” President Biden said recently. “We’re going to pay for everything we spend.”

Except they won’t. Take, for example, the bipartisan infrastructure bill. When it was unveiled with great fanfare at the end of July, a group of Democratic and Republican senators proudly proclaimed that its costs would be fully offset by new revenues.

“This is paid for,” said Senator Joe Manchin, Democrat of West Virginia. “Our infrastructure bill is all paid for.”

Just a few days later, the Congressional Budget Office — the official scorekeeper — delivered its verdict: The $550 billion in new spending would, in fact, mostly add to the deficit, with just $173 billion of offsets. A separate analysis by the University of Pennsylvania’s Wharton Budget Model pegged the 10-year shortfall at $351 billion.”

Steven Rattner | Too Many Smart People Are Being Too Dismissive of Inflation – The New York Times

Mr. Rattner, a contributing opinion writer, covers economics and finance.

Credit…Doomu, iStock/Getty Images

“We are all, to one degree or another, shaped by early experiences.

My father grew up during the Depression and never lost his fear of debt. I spent an early part of my career as a reporter at The New York Times, chronicling the rampant inflation that scarred the economy in the 1970s and the Federal Reserve’s struggle to contain it.

So far, the wary eye that I have kept on prices for four decades has been unnecessary. But now, with Congress poised to approve an additional $1.9 trillion in spending through the American Rescue Plan Act, I’m worrying again.

Yes, the monthly price index that tracks consumer prices continues to look benign. But even when casting aside the stimulus that the Biden administration wants to add to the economy, some important early warning signals have begun flashing.

The prices of many commodities are surging — copper and lumber because of a jump in home building. Global steel demand has pushed up iron ore prices. Even tin, heavily used in electronics, has soared as suppliers rush to meet consumer demand for new gadgets.”