HOME



Digby's Hullabaloo
2801 Ocean Park Blvd.
Box 157
Santa Monica, Ca 90405














Infomania

Buzzflash
Cursor
Raw Story
Salon
Slate
Prospect
New Republic
Common Dreams
AmericanPoliticsJournal
Smirking Chimp
Crisis Papers



MediA-Go-Go

BagNewsNotes
Crooks and Liars
CJR Daily
consortium news
Scoobie Davis




Blog-o-rama

Eschaton
Demosthenes
Political Animal
Driftglass
Firedoglake
oilprice.com
Taylor Marsh
Spocko's Brain
Talk Left
Suburban Guerrilla
Paperweight's Fair Shot
corrente
Pacific Views
Echidne
TAPPED
Talking Points Memo
pandagon
Daily Kos
MyDD
Electrolite
Americablog
Tom Tomorrow
Left Coaster
Angry Bear
Rooks Rant
The Poorman
Seeing the Forest
Cathie From Canada
Frontier River Guides
Brad DeLong
The Sideshow
Liberal Oasis
BartCop
Juan Cole
Mark Kleiman
Rising Hegemon
alicublog
Unqualified Offerings
Mad Kane
Blah3.com
Alas, A Blog
Fanatical Apathy
RogerAiles
Lean Left
Oliver Willis
Ruminate This
skippy the bush kangaroo
Slacktivist
uggabugga
Crooked Timber
discourse.net
Amygdala
the talking dog
David E's Fablog
Nitpicker
The Agonist


email address:
digbysez at gmail dot com
isnospoon at gmail dot com

01/01/2003 - 02/01/2003 02/01/2003 - 03/01/2003 03/01/2003 - 04/01/2003 04/01/2003 - 05/01/2003 05/01/2003 - 06/01/2003 06/01/2003 - 07/01/2003 07/01/2003 - 08/01/2003 08/01/2003 - 09/01/2003 09/01/2003 - 10/01/2003 10/01/2003 - 11/01/2003 11/01/2003 - 12/01/2003 12/01/2003 - 01/01/2004 01/01/2004 - 02/01/2004 02/01/2004 - 03/01/2004 03/01/2004 - 04/01/2004 04/01/2004 - 05/01/2004 05/01/2004 - 06/01/2004 06/01/2004 - 07/01/2004 07/01/2004 - 08/01/2004 08/01/2004 - 09/01/2004 09/01/2004 - 10/01/2004 10/01/2004 - 11/01/2004 11/01/2004 - 12/01/2004 12/01/2004 - 01/01/2005 01/01/2005 - 02/01/2005 02/01/2005 - 03/01/2005 03/01/2005 - 04/01/2005 04/01/2005 - 05/01/2005 05/01/2005 - 06/01/2005 06/01/2005 - 07/01/2005 07/01/2005 - 08/01/2005 08/01/2005 - 09/01/2005 09/01/2005 - 10/01/2005 10/01/2005 - 11/01/2005 11/01/2005 - 12/01/2005 12/01/2005 - 01/01/2006 01/01/2006 - 02/01/2006 02/01/2006 - 03/01/2006 03/01/2006 - 04/01/2006 04/01/2006 - 05/01/2006 05/01/2006 - 06/01/2006 06/01/2006 - 07/01/2006 07/01/2006 - 08/01/2006 08/01/2006 - 09/01/2006 09/01/2006 - 10/01/2006 10/01/2006 - 11/01/2006 11/01/2006 - 12/01/2006 12/01/2006 - 01/01/2007 01/01/2007 - 02/01/2007 02/01/2007 - 03/01/2007 03/01/2007 - 04/01/2007 04/01/2007 - 05/01/2007 05/01/2007 - 06/01/2007 06/01/2007 - 07/01/2007 07/01/2007 - 08/01/2007 08/01/2007 - 09/01/2007 09/01/2007 - 10/01/2007 10/01/2007 - 11/01/2007 11/01/2007 - 12/01/2007 12/01/2007 - 01/01/2008 01/01/2008 - 02/01/2008 02/01/2008 - 03/01/2008 03/01/2008 - 04/01/2008 04/01/2008 - 05/01/2008 05/01/2008 - 06/01/2008 06/01/2008 - 07/01/2008 07/01/2008 - 08/01/2008 08/01/2008 - 09/01/2008 09/01/2008 - 10/01/2008 10/01/2008 - 11/01/2008 11/01/2008 - 12/01/2008 12/01/2008 - 01/01/2009 01/01/2009 - 02/01/2009 02/01/2009 - 03/01/2009 03/01/2009 - 04/01/2009 04/01/2009 - 05/01/2009 05/01/2009 - 06/01/2009 06/01/2009 - 07/01/2009 07/01/2009 - 08/01/2009 08/01/2009 - 09/01/2009 09/01/2009 - 10/01/2009 10/01/2009 - 11/01/2009 11/01/2009 - 12/01/2009 12/01/2009 - 01/01/2010 01/01/2010 - 02/01/2010 02/01/2010 - 03/01/2010 03/01/2010 - 04/01/2010 04/01/2010 - 05/01/2010 05/01/2010 - 06/01/2010 06/01/2010 - 07/01/2010 07/01/2010 - 08/01/2010 08/01/2010 - 09/01/2010 09/01/2010 - 10/01/2010 10/01/2010 - 11/01/2010 11/01/2010 - 12/01/2010 12/01/2010 - 01/01/2011 01/01/2011 - 02/01/2011 02/01/2011 - 03/01/2011 03/01/2011 - 04/01/2011 04/01/2011 - 05/01/2011 05/01/2011 - 06/01/2011 06/01/2011 - 07/01/2011 07/01/2011 - 08/01/2011 08/01/2011 - 09/01/2011 09/01/2011 - 10/01/2011 10/01/2011 - 11/01/2011 11/01/2011 - 12/01/2011 12/01/2011 - 01/01/2012 01/01/2012 - 02/01/2012 02/01/2012 - 03/01/2012 03/01/2012 - 04/01/2012 04/01/2012 - 05/01/2012 05/01/2012 - 06/01/2012 06/01/2012 - 07/01/2012 07/01/2012 - 08/01/2012 08/01/2012 - 09/01/2012 09/01/2012 - 10/01/2012 10/01/2012 - 11/01/2012 11/01/2012 - 12/01/2012 12/01/2012 - 01/01/2013 01/01/2013 - 02/01/2013 02/01/2013 - 03/01/2013 03/01/2013 - 04/01/2013 04/01/2013 - 05/01/2013 05/01/2013 - 06/01/2013 06/01/2013 - 07/01/2013 07/01/2013 - 08/01/2013 08/01/2013 - 09/01/2013 09/01/2013 - 10/01/2013 10/01/2013 - 11/01/2013 11/01/2013 - 12/01/2013 12/01/2013 - 01/01/2014 01/01/2014 - 02/01/2014 02/01/2014 - 03/01/2014 03/01/2014 - 04/01/2014 04/01/2014 - 05/01/2014


 

This page is powered by Blogger. Isn't yours?

Hullabaloo


Sunday, August 21, 2011

 
Deficit hysteria
by David Atkins ("thereisnospoon")

Dave Dayen has a must-read post again today:
I might pinpoint the source of the problem a bit earlier – the pivot to the deficit occurred with the 2010 State of the Union, when the first Catfood Commission was enacted. That started to move public opinion and focus media attention on deficits, at a time when the economy was still weak. But in general, this is correct. We’re having the wrong conversation. And we’ve been having it for some time. You could argue that having this argument squarely on GOP turf led to their sweep of the 2010 midterms, ensuring that the conversation and the policy outcomes would tilt in this direction for at least the next two years.

So when you read that this could be one of the longest and most difficult recessions in history, and that it’s due to the “unusual nature” of the financial meltdown, essentially the Ken Rogoff/Carmen Reinhart “This Time Is Different” analysis, understand that such an analysis ignores the self-inflicted wounds from Washington at a time when the economy could have been revitalized. We have a demand problem, and government didn’t do what was necessary to boost that demand. What’s more, to the extent that this is a balance sheet recession (and it is), reducing household debt, particularly through the largest source of such debt, mortgages, would be the appropriate response, and yet the housing policies have been utterly useless if not actively harmful. You can talk about structural factors, the particular past performance of financial crises, and what have you. Government had the ability to fix this – at the absolute least ameliorate this – and they chose not to.

In short, there is no deficit that cannot be plugged except for our political deficit. It sustains the defeatism of years of no growth, stagnant wages, high unemployment. The political tendency toward right-wing and corporatist policy ideas over the past 30 years, tied up with the cost of running campaigns, the failure of traditional media, the conservative movement’s public relations machinery, has widened that political deficit between what government can provide and what it will provide.

Continuing this morning's theme, again this is a failure of leadership from the White House to even try to have the right conversation about what needs to be done.

The point here is not to endlessly criticize the President, nor is it to ignore the very real constraints placed on him by the right wing propaganda infrastructure and the Republican House, as well as his need to look forward to re-election in 2012 with independent voters who are wary of "government spending" and desirous of "compromise."

It may be that between the S&P shakedown and the GOP House's willingness to take the entire economy hostage, some version of austerity was necessary, and that a real jobs program in the wake of the 2010 elections would not have been possible. The counterargument by Administration defenders against Krugman and progressives is that we lack the political savvy to understand what is politically possible given realities in Washington. That we're political rookies, so to speak.

But let's say the defenders of the Administration are right on the political realities of the situation. That doesn't mean the President had to embrace austerity with open arms. He could just as easily have laid out his jobs program and his desire to put America to work, while warning about the effects austerity would have. He could have called out House Republicans for taking the country hostage, and made clear that he was signing austerity measures under duress. He could have demanded real concessions in exchange for the austerity measures put in place.

We've all been stuck in no-win situations before, where our only options are bad or worse because our hands are being forced by others. Smart people know that the way to handle those situations is to get everything we can out of the bad deal, while making it clear that it isn't how we would have preferred to handle it. When things go wrong, we make clear why they went wrong, and hopefully we get more leeway to make the right choices next time. This is basic politics--and not just Washington politics. It's basic family politics, office politics, organizational politics.

But the Administration didn't do that. It chose to embrace austerity. Even if austerity was inevitable, the embrace of austerity was an unnecessary slap to the face of the progressive base, of intelligent followers of Keynes' economic ideas, and of working people everywhere, while doing little to shore up the President's credibility with independents or feed the confidence fairy in the markets.

The reason that many progressives are so over the top in suggesting that the Administration is corrupted and acting in bad faith is because it's an easy answer to a hard question: what is going through the heads of the policy and political advisers at the White House? The embrace of austerity seems so basically stupid from both a policy and political standpoint that people looking in on the situation from the outside are left with either corruption or weakness as an answer.

If there's some brilliant strategy involved here, perhaps it's time White House advisers shared it with the rest of us.

.

Search Digby!