Mindless NYT Story on Weakened Jobs Bill Stirs More Deficit Hysteria
“Panicked Congress Tells Unemployed and About To Be Fired Teachers to Stuff It.”
That should have been the headline for this mindless New York Times article, “Currently in Vogue: Ringing the Deficit Alarm,” by Carl Hulse, who claims “Deficits finally matter.”
Hulse manages both to describe and legitimize Congress’ growing hysteria about the size of US deficits/debts. But he doesn’t bother to ask or quote a single economist, let alone the many who have been explaining for months, now screaming, that deficit spending now is not only not a serious problem but absolutely necessary to deal with lingering effects of the Great Recession.
All Hulse had to do was check with the Times Nobel economist or any of the Times’ stable of economic/business writers. Paul Krugman, along with Brad DeLong, Joe Stiglitz, Jaime Galbraith, Dean Baker, or if you prefer, Mark Zandi and many, many other serious economists, have been calling out the fraudulent arguments of the Pete Peterson deficit hawks for months and telling us we need more, not less spending to help the economy.
Every one of these reputable economists refutes the assumed premises of Hulse’ article and the prevailing ignorant mindset of too many in Congress that our debt/deficits are too high for the conditions we’re in. Instead, Hulse just takes for granted the false view, spread by deficit hawks, that deficit spending is irresponsible, an unfair burden on our children and a risk of inflation. No, it’s not.
Any of the Times economic/business reports could have told him core inflation rates is barely 1 percent, only half the Federal Reserve’s 2 percent target, and that an even higher target rate would help to stimulate growth and reduce unemployment under current conditions. But since Ben Bernanke has ruled that out, fiscal expansion of some sort is necessary.
Or Hulse might have asked what happened to the US economy in 1937-38 when FDR was talked into letting up on fiscal expansion and instead balance the budget, only to see that strategy thrust the country back into depression and massive unemployment.
The article might have explained that reducing the deficit now would stifle economic growth and increase unemployment. To explain that, Hulse might at least have given us the views of prominent non-stupid Democrats who are appalled that Congress can’t pony up a paltry $23 billion to prevent budget-stressed states from firing 300,000 teachers, or authorize a few billions to cover increased Medicaid costs or continue COBRA coverage for states dealing with high unemployment. Did Hulse and his editors even wonder what effects denying these funds will have?
But no, all we get is quotes from a panicked, misinformed Blue Dog Democrat, Jim Cooper, and Alabama’s Republican Senator Jeff Sessions, one of the stupidest men in the Senate but sadly representative of his party’s appalling economic ignorance.
“We have to stop spending money we don’t have,” said Representative Jim Cooper, a Tennessee Democrat who voted against the bill. “I hope deficit reduction fever is catching.” . . . [yes, there is a sickness here]
“Are we in denial in this body?” asked Senator Jeff Sessions, Republican of Alabama and another opponent. “Do we think it’s just business as usual, that we can just continue to spend, spend, spend and borrow, borrow, borrow?”
No, it’s not “business as usual.” We have nearly 10 percent unemployed. We’re trying to get a seriously underperforming economy and 15 million people out of a deep recession, and yes, spend, spend, spend is exactly the right thing to do.
Carl Hulse’s homework assignment:
Doug Elmendorf, Estimated Impact of the ARRA (stimulus)
Dean Baker, Congressional deficit hawks act to slow growth and destory jobs; Do you have to be clueless about the economy to talk about fiscal responsibility?; and Looniness in the cause of deficit reduction at the NYT.