The Republicans created the recent budget and debt ceiling crisis for one reason: they seek to destroy our economy, and thus prevent Barack Obama from being re-elected in 2012. What they did was tantamount to treason, and will cause untold misery in the United States and elsewhere by derailing the nascent economic recovery. We need to call the Republicans out on what they did, and hold them accountable in the next election.
The Republicans, like everyone else, know what it takes to get a country out of recession: spending. Yet, they insisted on just the opposite, demanding cuts in spending at what they knew to be exactly the wrong time. And, by acting irrationally, they intentionally panicked the stock market, with predictable results.
The basic economic facts are not complicated, nor in meaningful dispute. The solutions are fairly straightforward. I propose:
We need to spend money to get the economy out of the current recession. At the same time, our infrastructure -- roads, bridges, electrical power grids -- are in need of repair. In addition, there are projects, like the high-speed rail line from Los Angeles to San Francisco, that would be highly beneficial. The obvious solution is to get to work on these projects. In the short run, the spending will stimulate the economy, creating jobs at levels ranging from engineers to construction workers. In the long run, this kind of spending will leave us with capital improvements that will improve the economy and our standard of living for years to come.
Similarly, we should invest in education. Among other things, we should hire more teachers and pay them more. Teachers do not make much money, and they therefore spend a higher percentage of every additional dollar they receive (unlike the rich, who are more like to save a dollar they receive in tax cuts). And, education is just another form of investment. A child who is educated is more likely to earn a good living, pay taxes, invent useful things and otherwise be a benefit to society as a whole. We spend the money now, we get a return on our investment later.
Spending on war, by contrast, is of little or no economic benefit. War creates nothing. Bombs blow up, and they are gone. A solider who spends a year in Iraq could instead by creating something of value here, or anywhere else for that matter. A bomb or missile just blows up and is gone. Military hardware wears out, and while it is still operational, does not add to our economy anyway.
Cutting taxes on the rich is the least effective way to stimulate the economy. Give a poor man a dollar, and he will almost certainly spend it. That means someone else will earn that dollar. Give a rich man a dollar and he may well put it in the bank. At best, that lowers interest rates by making more money available to lend. But, interest rates are already low. And, some rich people will simply buy gold or other commodities, creating no jobs at all.
If you agree with me, please speak up. Vote. Don't watch Fox. Call the Republicans on what they do. Write a blog that no one reads. But please don't sit there quietly.
