Monday, April 16, 2012

The cruel stupidity that is economic austerity

On Sunday, one of the front page writes of DailyKos, Laurence Lewis, posted a harangue on The cruel stupidity that is economic austerity that is a rich compilation of links to the major economic-financial news stories and issues of that past few months. But Lewis had one major theme that really needs to pounded into everyone's skulls: economic austerity did not work in the 1930s, it is not working now, and it is stupid to think that it will ever work because austerity is so contrary to the economic realities that have been proven by the successful application of Keynesian stimulants to end the First Great Depression.

At some point in the future - hopefully the not too distant future - learned men and women will look back at our time in astonishment and wonder how and why we tolerated the usurpation of basic economic truths by a literal clown-show of wrong-wing clowns, and their misleadingly erudite academic apologists in the economics "profession." If we as humankind survive this onslaught of ideologically driven stupidity and drivel, we will look back on this time as the economic dark ages, when the dark phantasms of Ayn Rand, Friedrick von Hayek, Milton Friedman and their ilk, forced hundreds of millions to suffer needlessly for the unworthy reason of a blind ideological faith in the supernatural powers of "the market."

As Lewis wrote:
Keynesian economics suggests deficit spending as a means of jump-starting a waning economy, and it only proved itself by ending the Great Depression. There is no polite way to say this: the imposition of austerity at this moment in economic history is stupid. Not just a little stupid, staggeringly stupid. And not just staggeringly stupid, but on a human scale, just plain old cruel. Medieval cruel. Imposed suffering cruel. Deliberately imposed suffering cruel. And the results speak for themselves, because as bad as the abstract economic data look, the human costs are even worse. The human costs are profoundly disturbing.
It really is staggering to think that the solutions to our economic woes are so simple, so clearly framed by the lens of history, and yet so disdained by the majority of (useless) professional economists. Nay, not just useless, but worse than useless, because, as Lewis writes, their stubborn insistence on austerity is causing massive human suffering that need not be.
When right wing politicians talk about deficits you can be certain that they're waging class warfare. When right wing politicians pursue economic austerity you can be certain that they're waging class warfare. If right wing politicians truly cared about fiscal responsibility, they would raise taxes on those who can most afford to pay more taxes and they would end corporate handouts, whether they be direct subsidies or the indirect enabling that is having the public foot the bill for environmental and other public harms incurred as part of corporate profit making. If politicians cared about balanced books they would do what's best to grow the economy and rectify social and economic imbalances. Prosperity does not trickle down. If given the chance, it can blossom up.
In the United States, the only honest fiscal solution is to end the Bush tax cuts, end foreign military adventurism, stop pretending that it's necessary to spend more on military and ostensible national security hardware than the rest of the world combined, and end all forms of corporate subsidies. If a corporation cannot survive on its own it deserves to die. If a corporation's survival serves some vital social or security need and it cannot survive on its own, then it should be socialized rather than publicly subsidized. After all, public subsidies to privately held corporations already are a form of socialism, it's just that much of the money goes into private pockets rather than serving the public good.
That we are even discussing economic austerity is itself proof that the political systems of the developed world are but servants to private industry. We know how the world dug itself out of the Great Depression, and it wasn't economic austerity. It was deficit spending. It was Keynesian economics. It was a widespread series of policies that laid the foundation for true economic growth. From the ground up. The top resting securely on a solid base rather than on the shoulders of an overburdened populace. And as more and more people had the means to participate in the economy the short-term deficits began to resolve themselves. When people have money to spend they also have taxable income. When people have money to spend the businesses that profit off their spending also have taxable income. A reviving economy means greater government revenue because more people and businesses are contributing to it. A reviving economy means fewer government outlays, not as a form of social punishment but because there is less social need. It's not complicated.
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