Robert Rubin: Fiscal resiliency in a deeply uncertain world

By Peter R. Orszag, Robert E. Rubin, and Joseph E. Stiglitz

Robert Rubin and his co-authors, Peter Orszag and Joseph Stiglitz, propose a bold reimagining of fiscal policy for an era of deep uncertainty. Drawing on their extensive experience in economic policymaking, Rubin and his colleagues argue that traditional approaches using simple fiscal anchors - like debt-to-GDP ratios - are increasingly inadequate for managing modern budget challenges. Instead, they advocate for a new framework of "semiautonomous discretion" that would make fiscal policy more resilient and responsive to changing conditions.

At the core of their proposal is a five-point plan that would strengthen automatic stabilizers, create a new infrastructure program tied to economic conditions, extend Treasury debt maturities, index key fiscal programs to their underlying drivers, and preserve policymakers' ability to make discretionary adjustments as needed. This balanced approach aims to help the budget adjust more automatically to economic changes while maintaining essential flexibility for policymakers. The authors present this framework not as a rigid blueprint, but as a pathway toward more sustainable and effective fiscal management in an uncertain world.