Wednesday, November 17, 2010

Growth is Good

"Cutting the deficit is not only about making cuts." 
In today's NY Times, David Leonhardt writes about trimming the deficit by cultivating growth. Leonhardt explains that " A good deficit plan doesn’t simply make across-the-board cuts for years on end. It cuts funding for programs that do not spur economic growth and increases funding for those relatively few that do."  Ezra Klein agrees that the best way to reduce the deficit is growth. He also astutely points out that this is one reason why the narrow focus on the deficit commission is a mistake. "We should've had a broader commission looking at getting the economy back on track. Then there could've been recommendations to accelerate short-term growth," such as the one put forth by Rep. Jan Schakowsky (D-Ill.), who is co-chairman of the House Progressive Caucus.  As Digby says, "Why Democrats haven't been saying jobs=deficit reduction on a loop, I don't know. I guess they figure it's just too complicated to explain that when people aren't working they aren't paying taxes so the government doesn't have as much money. If government spends money to help people get back to work, it will be paid back when those people get jobs and pay their taxes. Et voila, deficit reduction. (See: 'the 1990s')." Steve Benen of the Washington Monthly also would like to see the Democrats "talk up this idea . . . It's not that complicated; the 1990s offer a recent model of success; and no one outside the far-right really wants those brutal spending cuts anyway."  [Related posts: Let 'Em Eat Catfood]


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