A Goldilocks Plan, Growth Then Restraint

This what won't get done.  There are just too many Republican demagogues in Congress to take good, constructive action.

The right strategy is to make growth the priority over the next few years while putting in place a credible, clear strategy for deficit reduction in the years after that. That’s entirely in Congress’s power. Lawmakers could pass a single bill that includes a short-term growth component to extend and expand the payroll tax, invest in public works projects and defuse the fiscal bombs, and a longer-term deficit reduction component, perhaps along the lines of theBowles-Simpson plan, that cuts the deficit by more than $4 trillion beginning in 2014. What markets would hear in that case is a commitment to the best of both worlds: a more robust recovery now, deficit-reduction soon. That’s much more reassuring than the message markets are getting now, which is that current U.S. policies are configured to give us the worst of both worlds, and that Congress is too paralyzed to change course.