90 Second Summary video of Debt, Deficits & Defense: A Way Forward

Bernie Sanders appeared on Dylan Ratigan’s show yesterday talking about Elizabeth Warren’s appointment. Towards the end of his interview, he said a few words about his opposition to extending the Bush Tax cuts to the wealthiest Americans. His proposal was to end the tax breaks the high income people, take the $700 Billion freed up, spend $350 Billion on sorely needed infrastructure projects, creating millions of jobs over a 10 year period and taking the other $350 million in savings and applying it to deficit reduction. So, Bernie’s heart is in the right place but he really doesn’t get the economics of it.

Tuesday night, I thought I’d attend The National Journal’s Debate on “Our Fiscal Future” between John Podesta and Douglas Holtz-Eakin with Jim Tankersley moderating at The George Washington University’s Marvin Center. I was interested because Podesta is often thought to be on the left-wing of “mainstream” opinion, and also it is said that he is one of the leading possibilities to succeed Rahm Emanuel as the President’s Chief of Staff. So, I wanted to see if I could find some glimmer of novelty in the point of view he expressed; some indication that he might bring some new thinking into The White House beyond what Obama has been hearing from say, Austan Goolsbee.

Unfortunately, the event filled up too fast and I wasn’t able to go, so I tuned into the live video stream, which is now available at the Center for American Progress web site. By the end of the debate I was very glad I didn’t go. First, because I got to “cover” the debate in my living room, and Second, because I didn’t appear to lose anything in translation, especially since the promised Q & A period was limited to answers to one question, and contained nothing that could possibly embarrass any of “the notables” or make them think twice about what they were saying.

Alan Greenspan undermines calls by the supposed ‘deficit hawk’ Republicans for keeping tax cuts in place.

In my previous three posts analyzing the June 26th AmericaSpeaks Community Conversation event I attended in Falls Church, VA, I presented the steps in the decision process used for the event, and discussed the pre-conference phase and the first four steps. These reflect a strong and consistent bias toward socializing participants into the idea that there is a deficit problem and that it has to be treated by cutting expenditures and/or raising taxes. The bias was reflected in many little ways in the materials used for the meetings and in the way the first four steps were carried out. The framing of exercises in the decision process continually restricted choices to ones that bring participants back to the supposed problem of a deficit and debt crisis. The web-streamed talks about national conference proceedings and orientations, and the brief constricted discussions of major values issues all worked to fit participants’ thinking to the ideas and frames presented in worksheets and the Federal Budget 101 presentations. Lines of discussion that would have led outside of the intended framing were politely aborted by the facilitators, pleading limited time, and the need to get through the agenda, and give everyone a chance to speak, so that any person developing counter-themes to the major narrative did not have a chance to develop these counter-themes and counter-narratives in the context of the supposedly unbiased process. In this post I’ll continue with my examination of step five of this process.

In my first two posts analyzing the June 26th AmericaSpeaks Community Conversation event I attended in Falls Church, VA, I presented the steps in the decision process used for the event and discussed the pre-conference phase and the first two steps. As we saw, these steps reflected a strong bias toward socializing participants into the idea that there is a deficit problem and that it has to treated by cutting expenditures and/or raising taxes. The bias was reflected in many little ways in the materials used for the meetings and in the way the first two steps were carried out. Here I continue my account with Step Three.

In early December, I asked whether President Obama would choose to be more like Hoover, or more like FDR. Well, I guess it’s definitely Hoover.

Jobs stimulus?

All this excitement over budgetary responsibility is most impressive, a real display of maturity, realism, moral rectitude, and tough love for the citizens of the United States. It would be even more impressive if the legislators and commentator involved were poor or middle class people who stood to lose out from this insistence on fiscal responsibility after 8 years of funding of George Bush’s tax cuts, wars, giveaways to the health insurance industry, oil companies, and pharmaceutical companies, and bank bailouts. However, since that’s not the case, I hope I will be forgiven for asking whether all this fiscal responsibility is really necessary, or even desirable, until we reach the point where we can forecast likely inflation due to excessive demand for scarce goods? Right now, we can do no such thing. In fact, all we can forecast, as far as the eye can see, is high unemployment rates, ruined careers and lives, and inadequate demand relative to both inventory and productive capacity — precisely the conditions that deficit reduction will only exacerbate.

The frequent calls for fiscal responsibility are justified only by fairy stories propounded by the old-time religion, which are in no way in accord with the way our modern economy and monetary system works. Indeed, an outbreak of fiscal responsibility in the foreseeable future will only promote a much more rapid decline in the economic capacity and prosperity of the United States, will lead to much more open class warfare, and to our de-evolution to the condition of some third world nations. Taking any serious action to reduce Federal Budget deficits in the foreseeable future is a form of slow national suicide, and is entirely inappropriate for Democrats, the so-called party of the people, to even be contemplating, much less agitating for. In my next diary, I will lay out the reasons why, by analyzing the assertions of both Bayh and his compatriots and David Broder, and showing that they are arrant nonsense.