The False Prophets of Dysfunction

January 14th, 2013 at 1:07 pm

I’ve been pretty committed to NOT writing about the debt ceiling debacle.  Not that it isn’t portentous—for the US government to default, either on its sovereign debt or any other of its contractual obligations would be a disaster, a much deeper self-inflicted wound than the fiscal cliff.  But it’s another massive key-dangle, ye olde magic trick where you get your audience to look over there instead of where the real action’s taking place.  In this case, that’s the real economy, where Congress continues its political malpractice of not just ignoring the fragile expansion, but of threatening to take it from fragile to broken.

But reading this WSJ column this AM, I’m reminded of a particularly pernicious rule of today’s politics: the self-fulfilling prophecy of dysfunction.  Many of today’s conservatives run for office on a platform that government doesn’t work.  And when they’re elected, they work their hardest to prove it true.  They say, “we’re Greece!” when of course we’re nothing like Greece, then they threaten default to make us Greece.

This is an alarmingly simple ploy, but once you tune into it you see it everywhere.  The prophets of dysfunction must convince us a spending crisis, an entitlement crisis, and debt crisis despite their factual inaccuracies.  It there’s no crisis—if, as is clearly the case—our fiscal challenges can actually be met with reasonable policies involving analysis (e.g., squeezing inefficiencies out of health care delivery) and compromise (spending cuts and revenue increases), these hair-on-fire-slash-and-burners have no use.

An important job of progressives throughout history is the exposure of such false prophets.  Of course, these prophets have huge profits riding on their ruse, so they won’t leave quietly.  But we must expose them nevertheless.  Our system is broken because a broken system works for the false prophets of dysfunction.  It doesn’t work for the rest of us.

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3 comments in reply to "The False Prophets of Dysfunction"

  1. foosion says:

    What makes their job easier is a media devoted to balance (shape of the earth: view differ), which lets them get away with so much.

    >>our fiscal challenges can actually be met with reasonable policies involving analysis (e.g., squeezing inefficiencies out of health care delivery) and compromise (spending cuts and revenue increases)>>

    I believe just fixing our health care system would be enough. Bring our costs down (and our quality up) to that of other major countries would solve any budget sustainability issues.

    Our economic challenges could be met in the short term by spending increases. We can’t control what future governments do about fiscal issues and shouldn’t let debates about the long term distract us from today’s problems.

  2. Fred Donaldson says:

    While not a swooning fan of Henry Blodget, he said something of import this morning on CNBC, as a closing comment – one that left the other panel members nearly speechless for a few seconds.

    He said the greatest economic challenges facing America today can all be solved if business invests in growing companies in America, by adding jobs, building plants, researching and developing new products.

    When that was greeted coldly, he summed it up by saying that American business has to start building value, not short term profits.

  3. readerOfTeaLeaves says:

    Appreciate this post.
    The whole ‘debt ceiling’ nonsense seems very DC-politics obsessed, and keeps sucking the oxygen out of the room.

    There is a *ton* of opportunity right now, although the GOP ideologues in DC appear blind to it.

    A meaningful conversation, a la Blodget, would focus on: what creates value.

    IMVHO, ‘government’ — by providing parks, schools, dams, ports, etc, etc — creates the conditions in which people create value, across generations.

    Progressives see this far more clearly than all the frightened Chicken Littles in Congress. (And nations like Taiwan, Singapore, Japan, and Korea, also recognize this basic economic reality.)

    Nevertheless, in U.S. politics (and in finance), there are people determined to avoid any solid conversation about ‘what creates value’, because that would expose — and call into question — the ‘value’ of tax havens, or 15% tax rates for ‘carried interest.’ Those folks want to keep the focus on bright, shiny objects like ‘debt ceilings’, endlessly wailing that the glass is half-empty.

    I have begun to think of them as “Doom Loopers”: they set up a self-reinforcing belief system about how terrible things are, and those expectations then set up conditions that make things ‘terrible’. Over, and over, and over… into a constantly-constricting death spiral. They’re inflicting a lot of needless damage.

    But their whining and hysteria have really become stale.