Compañeros, I have a dream today. No it’s not the dream where little black boys and black girls will be able to join hands with little white boys and white girls as sisters and brothers . . . I have that dream too, but today’s is different. In this dream, Obama’s deficit commission, the Pew-Peterson Commission, Erskine Bowles, Alan Simpson, Peter Orszag, Alice Rivlin, Peter Peterson, and David Walker are cast into the middle of Redskins Park, surrounded by a thousand eager flesh-eating zombies.
For the love of the sweet baby Jesus, I beg you all to not get embroiled in the bankrupt pastime of figuring out how to balance the budget. That is what all the very serious people, the economic royalists of The Washington Post (“If you don’t get it, you’ve got a quarter!”), the ignorant television talking heads, and now a parade of bankrupt commentators and commissions would have us do. This is the ultimate sucker’s game.
There should be no doubt that austerity — tax increases and spending cuts — would make the current awful employment situation appreciably worse. This is frankly acknowledged by deficit hawks, who are nothing if not cagey. Nevertheless, they would immerse us in discussions of austerity, in the middle of the worst employment crisis of the past thirty years. . . .
In the face of this perverse distraction, what is called for is a doctrine of implacable massive resistance: no discussions of austerity until the current employment situation is adequately addressed. What is called for is a trillion of new spending. It’s time for the WPA and the CCC. High-speed rail. Rebuild the Gulf Coast wetlands. Weatherize tens of millions of houses. Wire the schools. Free municipal wireless broadband. Reverse all state and local government budget cuts.
Maybe in five years we will have some leeway to start looking at reducing the rate of growth of Federal spending. Any talk before that point is a vicious affront to the current plight of tens of millions of Americans.
The deficit commission(s) would presume to not merely reduce the deficit, but to remake social policy (by eliminating the most defensible piece of welfare reform — the Earned Income Tax Credit), tax policy (by using revenue increases to cut taxes in other ways), and health care policy (by proposing effective monkey-wrenches for the new health care reform act), among other adventures in hubris. They are way out of their league. Of course, they are undaunted by a history of incompetence and failure. As Noel Coward said of another, “[They] are completely unspoiled by failure.”
By failure we of course refer to the mismanagement of financial markets leading to this horrible recession, topped by a massive reward to the miscreants at the bottom of it all: bonuses and elimination of competition, in the form of now-immortal “too big to fail” financial institutions whose fangs are granted official license to our financial necks indefinitely.
Show me an enacted program to raise employment massively, and I’d be willing to talk about ways to fix the budget in a humane way, closing military bases, withdrawing from Afghanistan and Iraq, raising taxes, and plenty of other wholesome devices. Until then, forget it. The notion that we have to do something “now” or else is just a flaming lie. We’ve been told this for twenty years. Who can still believe it?
You would think twice if you lived under a totalitarian regime and some mundane topic like civil service pay, legitimate in and of itself, was raised. No, there are some issues that automatically justify postponement of other discussions. 9.5% unemployment is one of them.
The flagship proposal of the commission’s chairmen is to slash Social Security benefits and 401(k) tax advantages simultaneously. So our children will enjoy less debt and more indigent parents and grandparents. The effective political response is obvious: “WHERE ARE THE JOBS?” You fucks.
The legendary Henry Aaron demolishes the Bowles-Simpson excuse-for-a-plan. Future legend Dean Baker motivates “the urgent case for delay.”



38 Comments

Hoover!
Do I hear a distinct sucking sound???
The working class are being vacuumed!!
Oh did I say AGAIN…..
Fix the highways and the water and sewer pipes that are failing due to age.
Upgrade the electrical transmission system so it can handle loads, and get power from solar and wind generators to cities.
Replace the weather satellites that are getting old, so people know when hurricanes are coming.
And that’s 9.5% OFFICIAL unemployment: the real number is probably twice that, since they stop counting once you stop collecting unemployment.
“There should be no doubt that austerity — tax increases and spending cuts — would make the current awful employment situation appreciably worse.”
What if the tax increases were on the wealthy who won’t spend that money in the economy anyway? Why let that money sit in some eccentric rich guy’s bank account? Let’s use it, and talk about lowering those taxes when the jobs come back.
— tax increases and spending cuts —
Tax the heck outta everybody(say, at Reagan’s exorbitant 50% level) earning over $1 Mil, and, stop all our subsidies to Big Ag and Big Oil, I’d wager that’d effectively halve our deficit right there…!
Thank you!
Where were this asses when Bush was creating this problem?
But, more importantly, where did this sky is falling shit suddenly come from, anyway? They’ve got their priorities all wrong. Trying to fix the wrong problem at the wrong time.
And they want the wrong people – the vast majority of the American people, who didn’t benefit when they were creating this problem – to pay for it.
It’s bullshit, and the American people need to make sure that both parties pay a dear political price come 2012 for their betrayals.
Civilian Employment – Population Ratio (labor participation)
http://research.stlouisfed.org/fred2/series/EMRATIO
I consider this a little more useful measure than unemployment. Right now, we’ve backed up to about 1984.
Hear! Hear! Want lower taxes rich people? The only way you’re going to get them is if the economy picks back up so we can afford them so it would be a good idea to stop sitting on fortunes and spending money to elect people who want to further screw things up. It would be in your best interest to use your influence to push for sound economic policies that would promote growth.
That’s what sane people would be saying anyway….
I never understood telling anyone to shut up.
The world needs the Glenn Becks and Sarah Palins to be our village idiots.
Every form of speech and idea generates thoughts and debate.
Besides, I thought we’re pro-free speech…
Shock Doctrine.
The state of the economy represents a shock, capitalize on it by pushing through your agenda as fast as possible, without allowing any time for reflection.
It has nothing to do with solving the problem.
The rich should be taxed, but not for the purposes of raising revenue per se. They should be taxed on their unearned increments so that society can recoup some part of what they gain through their already unfair advantages. The main purpose is to decrease the amount of they can use to further distort the laws of the land in their favor.
Rotwang is correct that we will lose if we argue in the context of balancing the budget, even if we were to win on the tax issue. The government can buy anything for sale in the economy at any time, including all the unused labor and all the homes in the country. It requires neither tax revenues nor debt issuance to do this.
Rotwang puts this very well: show us the jobs, you fucks.
I cannot conceive of anyone earning over a quarter of a million a year not being willing to close the gap of the deficit for a return to the pre-Bush rates. Although the 98% below this level needs extensions of the Bush tax rates to spur immediate spending and growth, I believe most people realize that balooning the deficit with extensions to the top 2% would be devastating. The subsequent swelling of the deficit would hurt consumer confidence as well.
Yeah, and we all know how many sane people there are in charge of things./s
I am not convinced that individual rich people even believe this would be wise. Of course, they are not going to cry over an extension, but I believe it is the corporations mainly and their prostituted politicians who are clamoring for tax cut extensions for everyone. At least, I would like to think so. Wouldn’t you?
Yeah, I can’t think of one either
When I say “rich people” in this case, I meant all big earners of course, (including corporations), as implied when I mentioned sitting on fortunes as opposed to using it to invest in the economy.
Sorry I wasn’t specific enough for you.
Instead of debating an extension of Bush tax cuts (just let them expire), debate a return to tax system under Republican President Eisenhower.
That 91% tax rate is what got us out of the depression, and helped create a middle class…
http://www.huffingtonpost.com/dave-johnson/bring-back-the-90-top-tax_b_99018.html
The problem with this vision is that zombies eat BRAAAANES and I’m fairly certain they’d starve…
So HTML tags aren’t supported??? That first graf was supposed to be quoted…
I’ts pretty difficult to get the idea of investment across to imbecile androids that flunked Econ 101 and don’t know the difference between expense and investment. Expense means a loss off your bottom line. Investment implies a return on the principal you put down. Good thing we didn’t trust these morons with starting the space program in the 1960′s, they’d have canceled that too.
In reality, this “deficit” bullshit is a smokescreen for the baldfaced extension of class warfare, which is well described by Robert Freeman:
http://www.commondreams.org/view/2010/11/14-1
These elitist goons aren’t even making a secret of it anymore—they are going to impoverish and enslave the middle class—permanently.
The purpose of collecting taxes is to pay for services that benefit society. Any other reasons for taxing the rich are ancillary.
Balancing the budget during an economic crisis is stupid. True. And…we should *still* cut spending on wasteful (and immoral) Defense Department spending. Not because the budget should be balanced but because society would be so much better served by investing elswhere.
Some are.
Strikeis supported as well as hyperlinks, bold and italic.iBASTA! indeed!! – Eternal Flamer
http://www.nytimes.com/interactive/2010/11/13/weekinreview/deficits-graphic.html?hp?src=ISMR_AP_LO_MST_FB
I had no problem reducing the deficit without hitting any liberal programs and making the entire government more progressive.
cut defense,
extend SS rates above 106k
fix the estate tax
kill the bush tax cuts for the rich
get out of foreign wars
cut the fleet
trim arms systems
reduce nuclear arms
end contracting out of govt services
and on and on
I got there with room to spare.
Great link. Thanks.
The top 1% holds 34% of the nation’s wealth while the bottom 50% holds just 2.5%. The bottom 40% owns absolutely nothing.
They are going to impoverish and enslave the middle class? Sure looks like it already happened.
Of course the thrust of the post is right.
Austerity and Balance the Budget are battle cries of class warfare.
OT. the NYT just posted a story about Nato and US winding down combat operations in Afghan in 2014. O goody, four more years of war.
Havn’t tried it yet but good to know. too bad that’s not what they are going to do. Besides the war in Afgan is now going on at least to 2014.
people like you are the problem. The people need a simple narrative, 10 years 10 trillion dollar infrastructure. A trillion dollars per year is 10 million jobs. The multiplying effect is 1.6 so that meanS 16 million jobs in ten years. This would be paid for by the rich PERIOD.
I happened to read this tripe as I went through my Sunday paper. I usually skip the wapo op-eds delivered to the Star-Ledger, but I didn’t this time. This just shows how little people such as she care really to understand what is going on with the attack on SS, or she knows very well and is trying her best to obfuscate on the topic.
Oh, I know. I agree with you.
“In the face of this perverse distraction, what is called for is a doctrine of implacable massive resistance: no discussions of austerity until the current employment situation is adequately addressed. What is called for is a trillion of new spending. It’s time for the WPA and the CCC. High-speed rail. Rebuild the Gulf Coast wetlands. Weatherize tens of millions of houses. Wire the schools. Free municipal wireless broadband. Reverse all state and local government budget cuts. [cont'd]”
Thought it was worth repeating…thank you.
MOd did not allow me to repeat your recomendations
Thought it was worth repeating…thank you.
There was a time when labor was valued and American works could go on strike. Not anymore.
Why can’t FDL join others in initiating Consumer Strikes?
Announce a day when no one buys gas. A day when no one goes to a supermarket. A day when no one goes to Walmart. Etc. The point wouldn’t be to bring the economy to a halt (not possible), but to make a statement to those in power, who rely on Americans to spend money.
The purpose of collecting taxes is to pay for services that benefit society. Any other reasons for taxing the rich are ancillary.
No, not really. Not at the national level. You seem to be caught up in the “household analogy” where you can’t spend more than you can earn or borrow. This is not true for the federal government because it is the issuer of the currency. It does not require your tax dollars in order to spend. If it runs a fiscal surplus it does not constitute “savings” that can be used later.
The first reason for the federal government to tax is to create a demand for its money. As an analogy, consider that the Pharaoh of Egypt wanted to build a pyramid. Do you think he would have needed to collect a certain amount of gold or a pile of beans of a certain size before he could begin work. No, he would have needed to compel resources and labor appropriate to the task. An easy way to compel labor would have been to institute, say, an oasis tax. So, every time a camel driver wanted to get a drink of water he would have had to pay a tax. Where would he get the money to pay the tax? By working on the Pharaoh’s pyramid, of course.
The government, if it expects society to function reasonably well, has a responsibility to maintain aggregate demand at a level where citizens can reasonably meet their obligations and aspirations. We are living in an economy with insufficient aggregate demand, and the private sector will not provide it. I made the point about taxing the rich as a means of reducing the enormous sway they currently have in our politics, not as a way to fund federal spending. That is prior to the tax issue. Taxation, as any conservative will tell you, reduces the spending power of the private sector. Sometimes this is justifiable and even necessary. Taxation could be used as a tool to deflate asset bubbles in a more efficient way than interest rate manipulation, for example. It will be damned near impossible to tax the rich in the current political climate, regardless. I just feel we waste our energy when we buy into false frames and premises.
I’m sure all this seems counter intuitive. I thought so too when I first started studying it. I’m not spouting unfounded opinions, all this is based on how money systems actually work. If you want to go to the sources, look up Warren Mosler, Bill Mitchell, Randall Wray or Marshall Auerbach
Excellent analogy in that third paragraph. I agree, taxes at the federal level have nothing to do with revenue. Federal money spent vs. taxes collected is nothing more than an interesting statistical comparison. There is no such thing as a federal deficit, unlike state, county, city, and household. In those, deficits are all to real.
I played that game at the Times and I think I did pretty well. 63% of my savings came from tax increases and only 37% from spending cuts, most of them involving the pentagon and their government contractors.
Never did I suggest a spending cut that would balance the budget on the backs of those with few means for survival.
And I surpassed the shortfall amount for 2013 and came up a few billion short for 2030. Not bad, for a few minutes work.
In the pyramid scenario, the reason for the taxation and drafting of labor was *to build the pyramid*. That would represent a government service that benefits the society. The pyramid had to be built with labor and money, which were drawn from the population. Labor *is* money.
“Taxation, as any conservative will tell you, reduces the spending power of the private sector.”
Famously, the very richest of the rich do not spend the money that they save through tax cuts, so private sector spending is not greatly affected by taxing the hell out of the top income brackets.
Rotwang: “The ultimate sucker’s game. WHERE ARE THE JOBS? You fucks.”
Ya said it all, Rotwang; and I hope you come in on your threads here as you did at the Cafe. We’d love to hear from you!