Friday, August 12, 2011

The Hijacked Crisis

From the New York Times, Nobel Prize winning economist Paul Krugman:

Check out the opinion page of any major newspaper, or listen to any news-discussion program, and you’re likely to encounter some self-proclaimed centrist declaring that there are no short-run fixes for our economic difficulties, that the responsible thing is to focus on long-run solutions and, in particular, on “entitlement reform” — that is, cuts in Social Security and Medicare. And when you do encounter such a person, you should be aware that people like that are a major reason we’re in so much trouble.

For the fact is that right now the economy desperately needs a short-run fix. When you’re bleeding profusely from an open wound, you want a doctor who binds that wound up, not a doctor who lectures you on the importance of maintaining a healthy lifestyle as you get older. When millions of willing and able workers are unemployed, and economic potential is going to waste to the tune of almost $1 trillion a year, you want policy makers who work on a fast recovery, not people who lecture you on the need for long-run fiscal sustainability.

Unfortunately, giving lectures on long-run fiscal sustainability is a fashionable Washington pastime; it’s what people who want to sound serious do to demonstrate their seriousness. So when the crisis struck and led to big budget deficits — because that’s what happens when the economy shrinks and revenue plunges — many members of our policy elite were all too eager to seize on those deficits as an excuse to change the subject from jobs to their favorite hobbyhorse. And the economy continued to bleed.

More here.

Yet another reminder that we don't have to be experiencing chronic ten percent unemployment, that we don't have to be witnessing the stock market wildly whipping its hair back and forth, that we don't have to be worrying about deficits, that we don't have to be on the verge of European style massive civic unrest because it has been within our power all along to jump start the economy. Huge amounts of spending, on the scale of the spending we did during WWII, would put a stop to all these economic troubles, just as the Big One put a stop to the Great Depression. And once people are back to work and spending again, tax revenues would skyrocket, greatly reducing deficit spending, putting our federal budget in a much more manageable position--as Krugman observed, because so many people are now putting their money into t-bills, the cost of federal borrowing is at an all time low: we really can get an amazingly large bang for our buck here.

I mean, we can do this.

The only thing stopping us is our leaders. Our leaders, who are so fucking stupid that they compare the federal government, which deals with monetary flows on a global scale, to a modest family budget, which is like comparing God to an amoeba. Our leaders, who have their heads shoved so far up their asses that they think Rush Limbaugh knows something about economics, or that they run for advice to the same Wall Street parasites who got us into this mess in the first place. Our leaders, who would destroy our economy instantly by defaulting on our national debts, or who would destroy our economy slowly, purposely shrinking it by way of federal spending cuts.

You know, one can almost forgive Herbert Hoover's retarded economic austerity programs early on in the Great Depression: Keynesian economics was fairly new at that point, and he very likely just didn't understand what was going on. But President Obama has taken the same high school history courses we've all taken. He knows how we spent our way out of the Great Depression. He knows, and yet he does his damnedest to reenact Hoover's great folly.

There will be no forgiveness for him.