MR. CARNEY: … The President’s budget will replace the sequester, which was designed to be bad policy for everyone with not just $1.2 trillion in deficit reduction, but $1.8 trillion in deficit reduction. In other words, it will go further than the sequester.
Let’s be clear about this. The terms “austerity,” “fiscal responsibility,” and “deficit reduction” are synonyms that refer to packages of tax hikes and spending cuts, which shift revenue from the private sector toward the government sector, thereby diminishing demand thereby and shutting down the economy, especially when those hikes and cuts are aimed at the 99%, e.g., the 2013 termination of the payroll-tax holiday.
Visibly, the self-congratulatory Obama White House is proud of their fiscal responsibility. But, as L. Randall Wray has noted, “fiscal responsibility” is something of an oxymoron, e.g., every time this nation has run a tax surplus, it was quickly followed by a depression — the one exception being the the Clinton surplus, which was followed by the somewhat delayed record-breaking recession that we are still in.
UPDATE: Per Tom Thumb’s post of yesterday, “Mr. Lew to Berlin: Don’t Do What Obama Is Doing Here”:
Treasury Secretary Lew goes to Berlin. Mr. Lew encourages Europeans to reduce their austerity measures because they are ruining their economies. He wants Europeans to spur their demand or spending.
NPR’s Mr. Green asks Mr. Lew (in Berlin) what he thinks about President Obama’s budget. Mr. Lew gives the official party response of how Mr. Obama has been offering the same budget policies for years and they are a reasonable mix of cuts to entitlements and increases in tax revenues. Mr. Green works really hard to ask about the similarities between austerity in Europe and austerity at home. But phrases like ‘long term fiscal constraint’, and ‘finding the sensible center’ act like intellectual razor wire and fill the interview with a wordsmith’s version of a room full of those small annoying plastic styrofoam packing pebbles.
It’s “fiscal responsibility,” “belt tightening,” and “pea eating” when Saint Barack pushes it. And, it’s dreaded “austerity” when Europeans push similar packages of tax hikes and spending cuts onto their 99%.