Large government deficits for any country is a problem only if the investors and Wall Street media start to question whether the country will honor those loans.
In this day and age, American credit is not questioned; we will and have capacity to pay our bill to the world. If you wonder how, strain your memory to that long ago time 2000 when we had a budget surplus which if we had kept the same level of taxation could have PAID OFF THE NATIONAL DEBT in a few years.
We can and must run a deficit to get this country out of the recession we are going to dip back into. We shouldn’t do it willy nilly like we did at the beginning of the Obama administration, but do so in a thoughtful way, targeting government spending so it spurs the most economic development and supports job creation that are sustainable America middle class union jobs.
Targeting construction, real spending on green jobs, transportation infrastructure, supporting state governments hiring teachers, school building and green retrofitting, an investment in science and innovation and extra money to low income wage earners.
This spending would actually not be that much, think of it as a few fighter jets we could just not build, to fight an air war that probably won’t happen this century or the next.
We need to spend, as FDR, LBJ and Reagan understood to get us out of a recession. As Reagan explained government deficits don’t matter when trying to end recessions, that is why he was a part of the largest expansion of government since the New Deal.
Krugman explains this well:Right now, we have a severely depressed economy — and that depressed economy is inflicting long-run damage. Every year that goes by with extremely high unemployment increases the chance that many of the long-term unemployed will never come back to the work force, and become a permanent underclass. Every year that there are five times as many people seeking work as there are job openings means that hundreds of thousands of Americans graduating from school are denied the chance to get started on their working lives. And with each passing month we drift closer to a Japanese-style deflationary trap.
Penny-pinching at a time like this isn’t just cruel; it endangers the nation’s future. And it doesn’t even do much to reduce our future debt burden, because stinting on spending now threatens the economic recovery, and with it the hope for rising revenues. While I don’t think Obama in not even 2 years is responsible for this systemic problem of the dying middle class and further desperation of the working poor, his approach for tax cuts and corporate support first, job creation last added to a political cautiousness is not just sinking his reelection chances its failing our economy.
We need real political courage to fight for the solutions to this crisis that are relatively simple and well known. Obama is failing that test miserably.
Bob Herbert in an amazing column you have to read says it so well:The oil catastrophe in the Gulf of Mexico, as horrible as it has been, was yet another opportunity. In his address to the nation from the Oval Office last week, President Obama could have laid out a dramatic new energy policy for the U.S., calling on every American to do his or her part to help us escape the insidious, nonstop destruction that is the result of our obsessive reliance on fossil fuels.
He chose not to.
As a nation, we are becoming more and more accustomed to a sense of helplessness. We no longer rise to the great challenges before us. It’s not just that we can’t plug the oil leak, which is the perfect metaphor for what we’ve become. We can’t seem to do much of anything.
…As Time reported: “Schools, health services, libraries — and the salaries that go with them — are all on the chopping block as states and cities face their worst cash squeeze since the Great Depression.”
We are submitting to this debacle with the same pathetic lack of creativity and helpless mind-set that now seems to be the default position of Americans in the 21st century. We have become a nation that is good at destroying things — with wars overseas and mind-bogglingly self-destructive policies here at home — but that has lost sight of how to build and maintain a flourishing society. We’re dismantling our public school system and, incredibly, attacking our spectacularly successful system of higher education, which is the finest in the world.
How is it possible that we would let this happen?
We’ve got all kinds of sorry explanations for why we can’t do any of the things we need to do. The Democrats can’t get 60 votes in the Senate. Our budget deficits are too high. Rush Limbaugh or Glenn Beck might object.
Meanwhile, the greatness of the United States, which so many have taken for granted for so long, is steadily slipping away. This is about loving this great country and the legacy left to us, too often those who are loudest in their claim of support for America are the ones who hate this great country the most.Labels: Budget Deficit, Green Jobs, Obama Administration, The Budget, The Economy |