Congress is Blind to People with More Month than Money
Almost every month, as the calendar winds down, I start getting calls in my office on the phone or in person from people who have more month than money. “Pastor, I’ve run out of money for food, and don’t get paid until the first of next month. I’ve got two kids, and need some help.” The specifics of the conversation vary, but the underlying substance does not.
Now, though, I’ve been hearing a different item tacked on at the end: “Pastor, you follow the news out of DC pretty well. Am I going to get my Social Security check next week?” These aren’t just old people, but folks getting SS disability checks too.
My friends who run food pantries, homeless shelters, and other emergency assistance centers are hearing the same things. They hear it from the unemployed, of course, but also from people with jobs that pay so little they can’t get by. According to Harvesters, a wholesale food bank operation that supports hundreds of food pantries, soup kitchens, and emergency in 26 counties around metropolitan Kansas City, forty percent of households turning to Harvesters include at least one adult who is working, and 73% have incomes at or below the official federal poverty level. “Pastor, am I going to get my Social Security check next week” is not a question of cash flow — it’s a question of survival.
Folks trying to climb out of poverty through education are worried, too. College students are asking about cuts to Pell Grant money.
And the good folks in Congress seem hell-bent on making things worse, by cutting government spending — and thus the jobs supported by that spending — all because of a new-found love of austerity.
In a longer piece about the less-than-good GDP numbers reported yesterday, Mark Davis of the KC Star noted this explanation for the downward revision to the Q1 GDP number:
Moody’s Analytics cited federal government activity for much of the 1.5 percentage point reduction in the first quarter economic growth rate. It said reduced estimates of government economic activity in the quarter slashed 1.2 percentage points from the earlier estimate, and slower federal activity accounted for two-thirds of that.
The government contribution to the economy also declined in the second quarter, adding to the more recent weakness.
Kind of proves David Dayen’s point about the wrongheadedness of the “let’s cut government spending a lot — RIGHT NOW.
McClatchy notes other economists chiming in with this same point.
Lawmakers trying to reach a deal on spending cuts in order to raise the nation’s debt ceiling risk causing serious economic harm if they cut government programs too much in the near term, economists warn. . . .
Despite the weak growth, politicians aren’t arguing about stimulating the economy; rather they’re debating how quickly and how much to cut spending, thus shaving economic growth in the process.
The U.S. Chamber of Commerce called on lawmakers Friday to be mindful of the weak economy.
When even the Chamber of Commerce is telling Congress to worry about the economy, you know that the GOP has gone way off the deep end. OSK-Deutsche Bank economists concur, as do the folks at Macroeconomic Advisors.
But Mark Zandi nails it, at the end of McClatchy’s piece:
Some House Republicans backed by tea party groups demand even deeper front-end cuts, perhaps as much as $100 billion, arguing that politicians can’t be trusted to keep their promises further out.
That’d be dangerous, warned Mark Zandi, chief economist for forecaster Moody’s Analytics.
“I think the idea is a very serious policy error,” he said. “This would be the fodder for another recession. The economy may be able to digest $25-30 billion more (in federal spending cuts) … but $100 billion, I don’t think it could digest that.”
Zandi, who’s frequently cited by Republicans and Democrats alike, favors spending cuts “when the economy is off and running,” but he cautions that “to add more fiscal restraint in the latter part of 2011 and 2012 would be a mistake.”
For folks like those who’ve been coming into my office, it would be more than a mistake. It would be a disaster.