Hullabaloo

Friday, July 29, 2011

 
Mythological job creation

by digby

Michael Sherer from Time was on MSNBC a few minutes ago exploding some of the myths about this stupid debt ceiling circus. To the question of "why nobody will compromise", he explained that there have been plenty of compromises already what with the Republicans giving up their request for liberal concentration camps and Democrats giving up everything they ever stood for (or something like that) and he explained that contrary to economic experts Michelle Bachman and Rick Perry default actually is a big problem.

But this surprised me because I think it may be the first time I've seen a mainstream journalist point this out:

Q: Last but not least, "this debate is about getting people back to work"

Sherer: That's right. Both parties like to talk about jobs and do it all the time because that's what Americans want to hear.

The problem is that this debate is really not about jobs, especially in the short term. All the plans that have been scored so far are going to reduce GDP, which reduces employment.

There is a long range benefit of solving our fiscal problems. but there's nothing for the short term. There's been one plan floated for so0me short term tax stimulus but it='s not been a priority for either party.

So when you hear both parties talk about jobs, this is just not the vehicle that's going to help the jobs picture. in fact the instability caused by this debate has almost definitely reduced investment in recent weeks and that's hurt the jobs picture.

I realize that the president has been more nuanced than the Republicans on the benefits of the massive spending cuts and contractionary nature of this whole debate. He evidently believes that once this is all over and all the cuts have been made that the Republicans will go home and get drunk leave the Democrats alone to start stimulating the economy and creating new more wonderful programs to make up for the destruction of the old ones. But it is still the case that most Americans have come to believe that fixing thew deficit will lead to jobs. (And hey, maybe it will --- in 2057)

[T]oday’s Pew poll offers some of the clearest evidence yet that Dems helped Republicans win the argument over the deficit and government spending by acquiescing to the GOP’s austerity/cut-cut-cut frame at the outset:

In terms of the public’s priorities for economic policy, more Americans (52%) say they would place a higher priority on reducing the budget deficit rather than on spending to help the economy recover. In February, opinion was more closely divided (49% reduce deficit vs. 46% spend to help the economy recover).

While there are wide ideological and partisan gaps on this issue, independents view deficit reduction as the higher priority. More than half of independents (54%) say this should be a higher priority for the federal government, compared with 39% who prioritize spending to help the economy recover.

This comes after yesterday’s Bloomberg poll found that the public broadly agrees with key GOP arguments: That deficit reduction is necessary to spur “economic confidence” (the “confidence fairy” argument) and that government regulation and taxes create “uncertainty” that harms job creation.

The key in today’s Pew poll, though, is that there’s been clear movement in the direction of prioritizing the deficit over spending to create jobs. The public was roughly divided on this question in February (49-46), but now the public prioritizes deficit reduction by 10 points (52-42).

If people trusted the Democrats to put job creation above everything else, they've been well schooled to believe that cutting spending is the way to get there.

Still, it's good to see someone in the press put that out there. It might have been helpful if they did it before both parties decided to take a swan dive over the deficit cliff, but I suppose it's better than nothing.

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digby 7/29/2011 12:30:00 PM |