Tuesday, April 5, 2011

New Republican "Fixes" for the Economy Are A Sham

Today we see what Republicans in the House have in mind when they talk about cutting the budget deficit.

Why? Because they've floated their outline for budget planning over the next 10 years, and it includes slashing spending by $5 billion, privatizing Medicare and cutting big from Medicaid. However, it also includes exactly $0 tax increases or other revenue sources. So, it's only touching one side of the budget ledger - spending. Story HERE.

You may recall a couple recent posts I wrote about the importance of addressing both sides of the ledger (spending and revenue) as a responsible way to balance the budget HERE and HERE.

Not surprisingly, the "new" ideas from the Republicans are exactly the same as their traditional ideas on economy and government. To me, this proves they are not serious about responsibly reducing the budget deficit and/or they are wholly blind to their addiction to"voodoo economics" of tax cuts for the rich and corporations combined with roll-back of government programs. This approach not only does not work but makes things horribly worse.

As evidence of this claim, I give you the entire history of the United States of America from the 1770s to the 1930s. That's right. Our history is one of boom and bust, boom and bust, boom and bust...all with a relatively small middle class, virtually no government programs or regulation and with wealth concentrated at the top among a very few.

Only in the period roughly between 1934 and the early 1980s did we REALLY break out and grow our middle class and society into the unquestioned economic, cultural, military and standard of living leader of the world. And what do you think was one key differentiation in that 40+ period of time from everything that came before? Responsible government programs and laws - Social Security, Medicare, Medicaid, Civil Rights legislation, regulation of financial markets and banks and others.

None of that stuff existed before 1932 and much of it has been under attack or rolled back since the mid 1980s. Only when government asserted itself responsibly to address the economic disaster of the Great Depression, mobilize the country for World War II and pass Federal civil rights laws did we flourish as a world power with a broad, deep, employed and comfortable middle class the likes of which had not seen by any society before.

Flash forward and back to recent times. Our current budget crisis was created by turning our back on the fundamentals that made us a great nation. Conservative economic theory and leadership over the past 10-12 years has been wickedly efficient of producing wealth for the already rich and big companies, but as it did so it created the massive budget deficits, shrinking middle class, rising unemployment and overall erosion of our society that we see today.

And what to the Republicans propose as of today to fix the problem they created...more of the same thing.

That's why I call "sham" on what they're proposing. It won't work...it never has...and is most likely just a new way to funnel money to corporations or the wealthy. And we know how that always works out for the rest of us.

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