The White House "floated" a lead balloon Monday by telling everyone that Obama’s next budget proposal, due February 1, will include a "spending freeze" on several categories of discrectionary spending. It’s a complete head fake: there’s no freeze, and all they’re doing is playing to the unrelenting stupidity of those, like Sen. Evan Bayh, who think the way to put people to work is to spend less money.

Someone please give Bayh the Washington Post’s unread copy of any economic text book on what happened during the Great Depression when FDR’s economic advisers foolishly convinced him the Depression was over and that he needed to worry about balancing the budget — or just send him this from Krugman or watch this. The result of cutting spending was to send the economy back into deep depression. Fool me once . . .

But the President’s economic and political advisers are being too clever by half; they’re not really planning anything remotely approaching a spending freeze. Most of the budget — including the military/defense, Veterans, the massive bureaucracies at Homeland Security, and lots of other stuff will be entirely exempt. The remaining items, which constitute about $447 billion out of a [$3.5] trillion plus budget, will not be frozen either.

What the Administration will do is what all administrations do: reallocate spending priorities, increasing some items and reducing or eliminating others. And even then the net change in the aggregate budget [for these affected items] will be about $25 billion per year, less than mere pocket change in the massive US economy.

But Rachel Maddow was correct in her give-no-quarter humiliation of the otherwise sensible Jared Bernstein. Every competent macro economist (well, excluding some freshwater folks) tells us that during a serious, high unemployment recession and "jobless recovery," like the one strangling our economy, government should be spending more to create jobs, not less.

We’ve got 10 to 18 percent unemployment, depending on whom you count, and there isn’t anyone who says our present policies will substantially reduce that for at least another year and probably longer. We’ve got at least a score of states marching off budget cliffs and taking essential public services, teachers, firefighters/police and health workers with them. They’re cutting health care, closing schools, parks, libraries and public facilities. We’ve got millions deep underwater on their mortgages, and the Administration’s mortagage restructuring efforts have dismally failed.

And there are no meaningful signs that the private sector can, within the foreseeable future, pick up the slack, put people back to work and start paying taxes.

What part of the critical need for massive federal spending and jobs programs do these people not understand?

But instead of showing some courage, and proposing what needs to be done, and explaining it to the American people, this pathetic, cowardly Administration sends an embarrassed Jared Bernstein onto our screens to talk nonsense about a freeze that isn’t a freeze and a modest middle class agenda that will do nothing to prevent America’s middle class from shrinking and falling further into the ditch.

Shameless. Stupid. Unforgiveable.

Paul Krugman Schools George Will on the Great Depression
Brad DeLong, Barack Herbert Hoover Obama?
The Hill, House Dems oppose Obama spending freeze, cuts
Paul Krugman, Obama Liquidates Himself
Yglesias, Reflects on the WH briefing
Joan Walsh, Dead Wrong, or Deeply Cynical



John has been writing for Firedoglake since 2006 or so, on whatever interests him. He has a law degree, worked as legal counsel and energy policy adviser for a state energy agency for 20 years and then as a consultant on electricity systems and markets. He's now retired, living in Massachusetts.

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