The national mythology about the economy given by the mainstream media can be summarized as a discussion whose terms are “austerity” and … “austerity.” Not “versus full employment” or “jobs” but how much austerity, when, and for whom. We all need to share in the sacrifice… Riiight!
The media choose to forget that during the 30’s Depression Franklin Roosevelt saved capitalists from themselves, in part by applying the Keynesian economics of deficit spending to overcome unemployment. When driven to sufficient levels by World War II, it worked as it was supposed to work. (The part we forgot recently was to pay back the deficits during the boom times. That, of course, would require responsible governance.)
Thus the government became the employer of last resort and repaired some crumbling infrastructure. It was goodbye and good riddance to the regressive, extremely counterproductive economics of Hoover and Coolidge.
Don’t you wish!
Doing its part to ignore history and regress fatally we have, for example, the March 3 Democrat and Chronicle editorial suggesting a truly regressive Simpson-Bowles like “compromise,” i.e. give-backs on Social Security and the federal Med programs (which “reasonable” Democrats need to learn to accept).
How is austerity working out for those who have already been force-fed this prescription in the Euro Zone? More jobs or fewer? Increasing debt ratio or decreasing? The news is consistently bad, predictable, and well known. But this is not part of our polite conversation in the media. Why not?
The actual but unmentioned issue is whether to get all austere, or confront unemployment. Which problem is most urgently pressing right now?
The “gotta reduce deficits now” argument is dishonest on its face, since by the only significant measure, deficits are going down as a percent of GDP in the US, but will, as in the Euro Zone, become larger as a percent of GDP when we copy the Euro austerity mania.
So even though Paul Krugman columns are printed in the New York Times, where is the discussion of his Keynesian economic ideas versus austerity? I want the austerity mongers to have a discussion with Nobel and other economists like Krugman, Joseph Stiglitz, and Richard Eskow, to name several of the widely ignored. Enough echo chamber already. How about an honest conversation and debate?
But of course I am dreaming. Conservative scolds have already drowned Keynesian economics in the bathtub by never acknowledging its existence or successful history. As far as I can tell, neither do liberal politicians who are fighting to “save” Social Security. If this is as big a trump card as I believe it is, why not?
MIKE CONNELLY, ROCHESTER