The real Grand Bargain

For about at least a year, there’s been simmering talk about a flaw in the economic discourse. Republicans at least claim to be concerned about the deficit and long-term debt; Democrats are concerned about high unemployment and economic growth. For all the contentious debate, there’s never been a good reason to stop policy policymakers from pursuing both goals at the same time.

The White House appears to have reached the same conclusion. With President Obama set to unveil a new economic plan in a few weeks, the administration appears likely to push for a real Grand Bargain: Obama will push for long-term debt reduction beyond the Super Committee’s $1.5 trillion goal and push for measures intended to boost the economy in the short term.

The point, of course, is to package the two objectives. As the president said yesterday, “We can’t afford to just do one or the other. We’ve got to do both.”

As is always the case, the details will make all the difference, and ideally, the debt-reduction portion of this agenda will focus far more on revenues than entitlements. But what about the stimulus phase? We’re likely to see a package that combines a series of ideas, which in isolation appear fairly modest, but when put together, would be intended to make a significant impact.

The measures include ideas that are no doubt familiar to those following the debate — infrastructure, payroll tax break, etc. — but there’s one proposal in particular that’s worth keeping an eye on.

The jobs package that President Obama plans to unveil shortly after Labor Day could include tens of billions of dollars to renovate thousands of dilapidated public schools and a tax break to encourage businesses to hire new workers, according to people familiar with White House deliberations. […]

The elements of Obama’s plan remain under debate. But backers of the school renovation plan and the tax credit for hiring new workers think the proposals could attract Republican support. At the same time, they think that if the debate becomes a public confrontation, the ideas would give Obama the upper hand in a battle for voters. […]

Supporters estimate that each $1 billion in school construction work would generate up to 10,000 jobs. A $50-billion program, for example, would underwrite half a million jobs by that calculation.

The average U.S. school building is 40 years old, and many are suffering from neglect — poor ventilation, energy inefficiencies and mold. A report by the American Society of Civil Engineers in 2009 gave the nation’s public school facilities a D grade.

This is referencing a bill called the Fix America’s Schools Today Act (FAST Act), which would be a school-based infrastructure measure, putting people to work improving public school facilities. Progressive economists love it, and if the White House incorporates this into the plan, it’d be very good news.

Will Republicans go along with any of this? Almost certainly not — any measure that creates jobs will necessarily draw immediate, reflexive GOP opposition. Trading debt reduction for jobs, in conservative circles, just isn’t good enough.

But once Republicans reject good, popular ideas that address the nation’s #1 issue, Americans will at least be able to see where both parties stand, and then choose accordingly next year.