Dean Baker: Changing the terms of economic debate

[marmar]

Changing the terms of economic debate
As long as we let ourselves be boxed in by a rightwing agenda that leaves us searching for least-worst options, we're losing

Dean Baker
guardian.co.uk, Monday 28 February 2011


There is a new economists' sign-on letter being circulated that warns bad things will happen if there are big cuts to the public investment portion of the federal budget, as Republicans in Congress are now advocating. The argument in the letter is correct, but it is nonetheless painful to see this sort of thing being circulated right now.

The politicians in Washington may have missed it, but we are still in the middle of the worst economic downturn since the Great Depression. The unemployment rate is still 9.0% and virtually no forecaster, including those in the administration, expects it to return to normal levels any time soon. In addition to the unemployed, we have more than 8 million people underemployed, and millions more who have given up looking for work altogether.

In such times, we might expect that there would be discussion of a big new stimulus programme. After all, we do know how to generate growth and create jobs. As a large and growing body of research shows (pdf), we just have to spend money. This means that tens of millions of people are suffering as a result of unemployment or underemployment simply as a result of bad economic policy.

The politicians who could, in principle, push through more stimulus have been intimidated into silence by the business lobbies and the media which have decided to make concerns about the deficit the top and only economic priority. In this context, it would have been reasonable to expect that a letter drafted by prominent liberal economists (the lead signers include Alan Blinder and Laura Tyson, two of the top economists from the Clinton administration) would centre on the need to boost demand to create jobs. Economists, who don't have to run for office can say such things, even when politicians can't. ...............(more)

The complete piece is at: http://www.guardian.co.uk/commentisfree/cifamerica/2011/feb/28/useconomy-usemployment

[ixion]

1. "we are still in the middle of the worst economic downturn since the Great Depression. "

Exactly.

[notesdev]

4. The Great Depression

won't look so "great" once we're done with this one.

This country is so far away from fixing its problems it's not funny anymore. All we do in this country is kick each other in the balls.

[ixion]

5. spot on, that...on all counts

We're facing an arduous path, and at this point we're not even acknowledging it exists, which is just making things worse.

[DJ13]

2. ".... intimidated into silence by the business lobbies and the media... "

The corporations want the money for themselves, no allocation that doesnt benefit them or their wealthy executives.

Look at how closely these numbers line up.

[marmar]

3. Wow......

.... Coincidence? I think not.

[Kweli4Real]

6. Where did you pull this table ...

Do you have a link, or did you grind out the numbers from the budget?

[DJ13]

7. Heres the link

http://www.civilrights.org/archives/2011/02/1158-taxes-safety-net.html

[Kweli4Real]

8. Thanks

It'll prove very useful.