Not Just a Lib/Con Thing

July 30th, 2011 at 5:19 pm

I read this in a WaPo review of the GDP report.

“Liberals said the weak gross domestic product figures showed that massive government cutbacks were unwise, while conservatives said that lowering the budget deficit should be the priority.”

But is this really best described as a lib/cons split?  Is it correct for readers to come away thinking that these are political positions with equal economic rationale?

I don’t think so.  In fact, the evidence easily supports the contention that government spending cutbacks have been a large drag on growth in recent quarters and have led to sharp losses in state and local employment.  And while you can surely find some economist to support the “lowering the budget deficit” priority, the vast majority will tell you that fiscal contraction now or in the near future would slow growth.

And they’re not be any means all liberals.  CBO says so.  Business investors/economists say so too.

Especially at a time like this, we need more careful assessments of such policy assertions.

 

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12 comments in reply to "Not Just a Lib/Con Thing"

  1. foosion says:

    There’s a reason Dean Baker call WaPo “Fox on 15th St.”

    The sentence you quote is mild for them. They have a lot of “Social Security and Medicare will destroy us” stories.


  2. jdrs0819 says:

    Even Goldman Sachs has said so. It’s ridiculous.


  3. Misaki says:

    >And while you can surely find some economist to support the “lowering the budget deficit” priority, the vast majority will tell you that fiscal contraction now or in the near future would slow growth.

    The implication of this juxtaposition is that the vast majority of economists feel that growth has priority over lowering the budget deficit.

    Economists feel that it’s their job to know how to make the numbers grow up. But the public has had quite enough of watching the numbers go up and have decided to play a different game.


  4. Brenda says:

    Hi, I just want to let you know how much I appreciate your appearances on Lawrence O’Donnell’s “The Last Word”. He and you help me to understand a difficult subject, economics, which as far as I am concerned might as well be quantum mechanics.

    I am the direct opposite of the people you see every day. I am nobody, living on SSDI and in a HUD sec 8 subsidized housing. Everyone here will be greatly affected by what happens soon and yet we have no real say in the outcome. I am better off than most but many people in my building are living month to month on very little indeed. We will all be hurt if social assistance is interrupted. Some here have medical conditions (HIV, diabetes etc.) for whom missing medications is potentially life threatening.

    Thank you for your honesty and direct, simple explanations in the media. It helps. I also like Lawrence O’Donnell a lot. I think he’s about the smartest guy on msnbc, *almost* as smart as Obama. 😉

    thnx


    • Jared Bernstein says:

      Thanks for that and you’re clearly not nobody!


    • John says:

      “But many who are the greatest now will be least important then, and those who seem least important now will be the greatest then.” (Matthew 19:30, Mark 10:31, NLT)


  5. Michael says:

    It is a liberal thing to care whether or not the data bear out a given policy choice.


  6. fausto412 says:

    Mr. JB, you ask for the press to THINK…they are not paid to think apparently.


  7. Wasabi says:

    Great post, Jared. JP Morgan also recently predicted austerity would shave 1% off GDP growth next year. WaPo is writing pure propaganda. Please demand an OpEd rebuttal chance! We can’t let them get away with denying economic common sense!


  8. Ron E. says:

    It’s a Republican partisan thing not a conservative thing. If a Republican were President with this same economic data, all these same conservatives would be arguing we needed untold trillions of dollars in tax cuts to stimulate “investment” and none of them would care one whit about the deficit or the debt.


  9. Anthony Miller says:

    You forget that Koch Brothers and Grover Norquist controls the Republicans. FOX dominates the airwaves. How can you get the truth out when it is perfectly acceptable to go on the airwaves and lie with consequences? When you point out the truth, you are called a liberal or they paint you as being naive.

    Until the so call media meaning journalist really do their jobs, and politicians get really serious in dealing with our problems in pragmatic way, I am afraid we will continue to be controlled or influenced by a few.


  10. comma1 says:

    Why, it’s almost as if the Repubo long game of casting the news media as “liberal” is paying dividends today by effectively shutting out accurate information from reaching John Q. Public. Why are you surprised by this? This is only the third piece of important information in this President’s term that has been neutered by this Repubo long game that they have been playing for almost 30 years.

    What I’m interested in hearing you speak about is the ratings agencies, have-their-cake-and-eat-it-too approach to downgrading the U.S. ratings. It seems that expert opinion has concluded that we will be downgraded regardless of the debt limit agreement, because we have: unsustainable long term debt, and more importantly, a group politicians incapable of rule. This leads me to the following 5 questions:

    1) If we are going to be downgraded anyways, then there is zero incentive for the president to negotiate. The point of the negotiation was to avoid downgrade — repubos have already flummoxed that. Why would the president bend to every conservatives wish and not even keep the U.S. from being downgraded in the process? That is a lose lose situation with zero incentives, unless the president is a conservative, which he appears to be.

    2)How is it that ratings agencies can claim that the problem with the U.S. is a political problem, because of Tea Baggers taking a nihilistic approach to the debt ceiling and yet, also claim that if those Tea Baggers don’t get their way then we will get downgraded?

    3) How is it that the ratings agencies can claim that we have a debt problem, demand drastic cuts, and not expect those cuts to make the present unemployment/gdp/etc. problems worse?

    4) Why have we not regulated the ratings agencies out of existence or taken them over? Last I checked, just about every ratings agency got us into this debacle because of CDS’s, they also seemed to flummox the description of the downturn more generally (as the revised gdp numbers of last week show). And if I remember correctly, Zandy was often testifying on the hill about the size and scope of the doom that a collapsed Lehman Brothers was causing. So why are we allowing these companies that operate so incredibly poorly and contrary to the public good to exist?

    5) Who is going to nominate that we put a statue of Grover Norquest in front of the treasury with a nice fat plaque that reads: “This is the man who got the full faith and credit of the United States questioned.”


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