The Real News: Paul Jay- Robert Pollin: 'Why Austerity and Not Stimulus?'

 

Source:The Real News- what Socialist call the government's money. They say it's the people's money, but want government to spend the people's money for them, instead of letting the people spend their own money.

"Bob Pollin: Main objective of austerity is to demolish the welfare state and public ownership." 

From The Real News

It's hard to argue that the 2009 Recovery Act was a success, if you look at the fact that today's unemployment rate and economic growth is both lower today than it was in late 2009, when the Great Recession officially ended, but we would be a hell of a lot worse off without the Recovery Act even though its not a great success. 

But why wasn't the Recovery Act more successful, because it wasn't big enough and wasn't targeted properly. Which is what happens when you legislate in crisis mode and you try to and I'll clean this up, fly by the seat of your pants without a gage (perhaps you are drunk and blind as well) to tell you where your going and how to get there but the fact is we needed something like this but it should've been done better. 

I argued in a blog post in early 2010 at the one year anniversary of the Obama Administration as well as during President Obama's first 100 Days that the Recovery Act wasn't big enough and not properly targeted. And if you are going to have a borrow and spend Economic policy (which I'm generally against, except in an economy this bad where no one has any money to spend) and the Federal Government is the only one capable of printing money with their control of the currency, that you should borrow as much money as it takes to deal with the Great Recession to get economic and job growth going again. Instead of borrowing 45B$ for infrastructure, that you should borrow about ten times that, to fix a lot of these projects that the Core of Engineers said has to be done. 

That instead of cutting taxes and regulations and expanding lending authority for small business in the summer of 2010, that you do that during the heart of the Great Recession. And this is not Monday morning quarterbacking on my part, I wrote this in a blog post on this site two 1/2 years ago. 

The idea National Infrastructure Bank that has a bipartisan bill in the Senate that would be self-financed and prioritize a lot of these infrastructure projects, should've been in the Recovery Act and we could've borrowed the money to start it up and it would've had a two year head start and up in running right now. And be taking care a lot of this work and putting a lot of people back to work today and our unemployment rate would've fallen. 

And because the Recovery Act was badly designed, today we have an economy thats as bad or not much better than when the Great Recession started and we are left with a bad economy and national debt and deficit that have to be dealt with at the same time. Partially because of the Recovery Act, but also because of a lot of bad fiscal policies that the Obama Administration inherited from the Bush Administration. So we are in a situation today in the summer of 2011, where we have to both, stimulate the economy and pay our bills and cut our costs. 

The debt deal of last week is a solid start but should've been a lot better and hopefully round two ofdDebt reduction will be a lot better and more balanced. But as we are doing this we need to put people back to work and spending money again, which is the easiest way to pay down our debt with economic growth. 

A National Infrastructure Bank, free trade, and energy bill ,more targeted tax cuts to encourage consumer spending, would be a good start and we can pay for all these things as well, without hurting the economy.