Good News and Bad News
It is nice to know that I am on the side of those who argued that a decrease in spending (government spending) was bad for the economy. It is nice to know that I was right. No, I’m not some high-powered economist. I would like to think that I’m someone who sits back and looks at most of the available data and tries to come to some logical conclusion. It would be nice to say that the economy of the United States, or that the world for that matter, is based on some grand moral play. When people do bad things, like overspending, they will get punished for it. Unfortunately, the economy doesn’t work like that. Sometimes those who make the most reckless and thoughtless economic gambles aren’t risking their own money. They’re risking yours.
This is a convoluted way of saying austerity has failed. There was that one academic study that conservatives waved around which turned out to be incredibly flawed. It was so flawed, in fact, that a grad student was easily able to show that their data didn’t make any sense. So, where does that leave us? Austerity doesn’t work. The American economy is stagnant secondary to the sequester (Austerity 2.0), many of the European countries that embraced austerity (Ireland, Spain, et al) are “enjoying” pain without gain. Where does that leave us? In my opinion, the answer is simple. We need government spending. This is the good news. The bad news is that US lawmakers haven’t figured out that they are punishing the American people for no good reason.
On another note, the weakness of Democrats sometimes makes me want to vomit, right here, right on my keyboard. The Democrats made their argument over how bad the sequester was going to be. They rained all of this negativity about the sequester and what an absolutely terrible idea it was. They were right. Yet, the Republicans talked nothing but happy talk. Conservatives said that we would notice nothing with the sequester. Slashing government spending would be no big deal. No one would notice. So, for the first several weeks/months of the sequester, Republicans looked like they were right. There appeared to be no specific bad side effects to these massive government spending cuts. We then started seeing long lines at airports because of furloughed air-traffic controllers. Suddenly, Congress sprung into action. The Democrats caved. Instead of standing strong and clearly articulating to the American people that this is exactly what they were talking about, the Democrats allowed the Republicans to craft legislation to carve out an exception to the sequester. What the hell? All the Democrats had to do, in my opinion, was to stand up and point out that this is a perfect example of the consequences we warned the American people about. This is the sequester. The Democrats should have proposed only two options, repeal the sequester totally or continue to embrace it. Instead, they’ve allowed to carve it out. This is an excellent example of how to lose an argument even when you’re right.
The good news is that I was right on austerity. Austerity doesn’t work in this situation. The bad news is that the Democrats caved on the sequester.