Lack of Congressional Agreement Necessitates Vast PC Expenses

“Money for free! Well not exactly,” he writes. “The Piper that has to be paid will likely be paid for in the form of higher inflation, but that of course is what the central banks claim they want.” This is pretty surprising stuff coming from a guy who bet the farm back in 2010 on the idea that Federal Reserve bond buying would spark excessive inflation and cause interest rates to soar. Gross was wrong, and now, I guess, he’s admitting that his economic framework was flawed. And he should be commended for changing his mind as the evidence changes, as he should be commended for looking outside the box for solutions to anger that the 2016 election cycle has clearly showed are festering just beneath the surface of middle-class America. This is in stark contrast to what many of the experts who spoke at this week’s Milken Institute Global Conference were saying. At the conference, which draws the elite of the world of finance as well as many politicians, many seemed to be in denial, dismissing the idea that 2016 presidential primaries say anything about the problems ordinary Americans are facing. Of course, the chances of something like UBI passing in a political climate like we have today aren’t all that great. UBI boosters like to say that it’s an idea that both sides of the aisle can get behind, but the reasons why they can get behind it are so diametrically opposed as to make this agreement moot. The Democratic Party is getting pulled to the left on issues of entitlement spending and the minimum wage. The Republican Party (outside of Donald Trump) believes that we must cut or at least cap transfer spending. And neither party seems particularly interested in compromising, which makes the idea that they will set aside their differences to focus instead on the delivery method of these transfer payments a bit far fetched. Wonks like to talk about issues like UBI, because it allows them to discuss policy without taking political stand on what level of redistribution is fair. But politicians and voters care much more about big moral issues like what level of wealth inequality is just. And Congress isn’t going to waste the political capital on a major reform that may be palatable for everyone but doesn’t address these larger questions.