21 November 2011

No Super Heroes on this Super Committee

There are only two questions Congress should consider: how do we create jobs and how do we raise living standards.

It is absurd to take on the question of how to reduce the deficit. With unemployment at 9%, it's stupid to raise taxes or cut spending. And given that unemployment is unlikely to drop to 6 to 8% before this Congress has finished its term, they can't make any progress towards deficit reduction anyway. Today's Congress cannot commitment a future Congress (if they could, the pre-Civil War Congress could have committed all future legislatures to uphold slavery).

Deficit reduction is a problem for tomorrow's Congress to solve. Job creation and GDP growth is a problem for today's Congress to solve.

The Super Committee failed to reach an agreement that would solve the deficit. So what. It would have all been promises that only future Congresses could have kept - and you can guarantee that those future Congresses won't be coming to Washington just to implement someone else's plan.

That deficit reduction during a recession has become such a huge issue is reminiscent of the push to invade Iraq. Austerity economics during a recession is an inane idea and yet we've somehow found ourselves unable to talk about anything but.

No comments: