April 26, 2013 By Jack Jodell.
An April 18 piece by Senior Editor Lynn Parramore which appeared in Alter Net has blown a hole in the reactionary Republican LIE which has fueled utterly ridiculous and needlessly barbaric austerity measures all across Europe and the United States. That these far-right fools have been engaged in lying or economic barbarism is hardly a new phenomenon – they’ve been at it for many years. Like a flock of superbly well-trained parrots, they have been cackling out their insane nonsense for decades: that giving the wealthy huge tax breaks would create millions of new, good-paying American jobs; that raising taxes on the very wealthy would be persecuting “job creators” and would result in higher unemployment; that huge corporations would “self regulate” for their own good and therefore didn’t need any government oversight whatsoever; that government itself was too big and needed to be scaled back for the public good; that taxes are too high across the board and must be greatly reduced; that the federal government has never created even one new job; that providing a safety net for the poor would make them chronically dependent on government aid and cause them to become lazy and unwilling to work; and that government spending is far too high and must be immediately slashed.
People with even an ounce of common sense knew how false and foolhardy these arguments were. They knew that simply giving the wealthy more money would never (and never did) spur them on to create new, good-paying jobs (the only growth it created was in low-paying and even slave-wage jobs outside of the country). People knew that taxing the wealthy more was only fair and sensible policy and wasn’t “persecution” at all – in fact, it had been proposed long ago by Thomas Jefferson, and besides, even after their higher rate had been paid, the wealthy would still have even more money than they could ever hope to spend anyway! Not only that, but isn’t the way corporations and wealthy business owners have exported jobs, held down wages and reduced or eliminated benefits for workers and the poor despite huge productivity gains over the past 30 years a form of unjust “persecution” against those very same workers? Honest, thinking people would certainly agree! As for reducing government regulation, the speculation Wall Street engaged in and the reckless loan-sharking mortgage bankers engaged in up until 2007 which brought on the Great Recession of 2008 more than proves the preposterousness of that position! Regarding the belief that the government is too big and needs to be shrunken, perhaps that would be advisable once the business community stops its decades-long assault on the poor and middle class, stops trying to eliminate labor unions, stops hoarding almost all the profit for itself, and begins to finally engage in fair and sane business practices instead of the insane money-grab it has been on for farrrr too long. Business in America simply needs to begin exercising some legitimate self-discipline instead of practicing easy-way-out, “me-first-and-to-hell-with-you” crybaby shenanigans! As for taxes being too high, they are – but only on the working poor and the middle class! The wealthy have been getting away with economic murder ever since conservatives cut their top tax rate to 50% under Ronald Reagan! Since then, they have pushed for, and gotten, an insulting array of tax loopholes not available to those of lesser income. Today, their maximum rate has dwindled to only 39.6%, a mark far lower than in other developed nations, and many get by without having to pay even a single dime. Still, they push for even lower tax rates. When they claim the federal government is spending too much, it is, pure and simple, a mockery of truth AND justice! The FACT of the matter is that they are paying FAR TOO LITTLE and are shifting the burden of taxation unjustly below them onto many who can ill afford it! Lastly, when it comes to their argument that the government safety net for seniors, the chronically underemployed, and the poor must be abolished because it is turning them into dependent wards of the state, that is ludicrous by itself, but all the more so when one considers the vast amounts of subsidies, tax write-offs, and other forms of corporate welfare the wealthy continually avail themselves of every single day. For these people to insist that the government spends too much – especially on needed social programs for the less-fortunate – is the height of their blatant hypocrisy!
These extremely short-sighted and callous people on the far-right (most of them from the Tea Party-infested reactionary Republican Party) love to use “the typical American family” as their role model for not only condemning federal deficit spending but also for advancing their utterly insane agenda for putting the government and country on a very, VERY harmful austerity budget. They say that government spending is out of control and must be immediately slashed. As the abovementioned Ms. Parramore points out in the Alter Net article, these thoroughly mistaken yahoos have based their position on a recent study by two Harvard “economists” named Carmen Reinhart and Kenneth Rogoff. Their Reinhart-Rogoff Report has been lustily embraced by all the leading far-right parrots, from Paul Ryan to John Boehner to Mitch McConnell to John Cornyn to Rand Paul to Bill O’Reilly to Glenn Beck, ad nauseum. They all point out how supposedly disastrous it would be if “the typical American family” overspent as they allege the federal government does. They claim uniformly that once a country’s debt to annual gross domestic product ratio crosses a 90% threshold, it is disastrous for economic growth. The problem is that no one can say how or why this 90% figure became THE determining figure. Was it simply pulled out of thin air, or what? Another problem is that the assertion itself is simply NOT TRUE. Worse yet, it was based on false data!
The report completely ignored data from the high debt countries of Belgium, Austria, Denmark, Australia, and CANADA, which for many years had shown fairly robust growth rates despite carrying very high levels of debt. Beyond that, nearly a century of high debt, average growth British data had been totally omitted! A close inspection of this supposedly rock-solid report had exposed it as being a complete fraud. Unfortunately, right wing pundits and far-right politicians the world over were using it as a basis for implementing harsh, restrictive anti-spending budgets everywhere rather than providing stimulative measures, as they SHOULD have properly done! This means the austerity budgets which have been imposed on many countries, including the ridiculous sequestration we are now struggling with in this country, should never have been adopted and must now be REVERSED!
The obvious FACT here is that deficit spending is a necessary and vital component of any healthy economy! Deficit spending provides jobs, just as it did in the 1950s with the ambitious interstate highway program. The economy grew in leaps and bounds for the next two decades as a result of this government-sponsored measure. Many other industries sprang up as a result of this increased spending. Tax revenues increased greatly, and the country nearly achieved full employment on a number of occasions. Business and labor both prospered, and each had a definite, rewarding seat at the economic table. We need EXACTLY that type of program today to revitalize and renew our decaying infrastructure! Not only that, but deficit spending, in the form of mortgages and bank loans for automotive and business equipment purchases, is a very needed component, one which helps drive the economy. Nearly all Americans can and should partake in this activity, and most do to a certain extent by using credit cards. Like anything, spending in itself isn’t necessarily all bad: often, it stimulates a slow economy. It must simply be engaged in for economic stimulation rather than be needlessly wasted. Grim, fear-breathing deficit hawks like Paul Ryan and his Tea Party-infested reactionary Republican cohorts need to learn this lesson and stop preaching economic lies!
Let us hope that the knowledge that this Reinhart-Rogoff Report is badly skewed and flawed will lead to to its demise, and to the end of these foolish and destructive austerity measures throughout the world! Such nonsense cannot be allowed to flourish!