By now, it’s been thoroughly proven by events that austerity policies backfire. Cut public spending in a deep downturn, and you only worsen the slump. Europe is the more extreme version of the proof, but even the United States, which is technically out of recession, faces a needlessly slow recovery. We’ve reduced deficits by slashing spending, raising taxes, and making sequester deals, but the supposed reward in the form of restored business confidence never arrives. Austerity, as Mark Blyth writes, neither restores growth not reduces the debt ratio, because slow growth (and in some cases negative growth) makes the debt loom that much larger.
|By: Robert Kuttner Sunday August 18, 2013 1:59 pm|
|By: Jane Hamsher Monday December 20, 2010 11:45 am|
If, as Robert Kuttner says, Obama is negotiating a a “grand bargain” with the Republicans that includes cuts to Social Security benefits, the GOP is running a successful trap for him once again. White House strategist apparently believe that this will “give Obama ‘credit’ for getting serious about deficit reduction.’”
|By: Mark Thoma Saturday July 10, 2010 2:00 pm|
It’s possible to give two very different interpretations of the Obama presidency so far. The first is a relatively positive interpretation. Proponents of this view argue that even though Obama has faced a united GOP willing and able to use filibusters to thwart initiatives, and even though he has had opposition within his own party to progressive initiatives, he has still managed to rack up an impressive list of achievements. Take health care as an example. The health care legislation wasn’t all that progressives wanted, not by a long shot. But the legislation is an impressive start and, importantly, it leaves the door open to further change. Though people forget, programs such as Social Security or Medicare weren’t perfect at first, but were improved substantially over time.