Myths of the Deficit

By Marty Wolfson | April 23rd

Why do people think that it is more important for the government to reduce the deficit now, rather than to spend money to create jobs?

Nearly 15 million people are officially counted as unemployed in the United States, and more than 6 million of these have been unemployed for more than 26 weeks. Another 11 million are the “hidden” unemployed: jobless workers who have given up looking for work and part-time workers who want full-time jobs. Unemployment has especially affected minority communities; the official black teenage unemployment rate, for example, stands at 42%.

The moral case for urgently addressing the unemployment issue is clear. The costs of unemployment, especially prolonged unemployment, are devastating. Self-worth is questioned, homes are lost, families stressed, communities disrupted. Across the land, the number one issue is jobs, jobs, jobs.

The economic case for how to address the jobs issue is also clear. As Keynes argued during the Great Depression, federal government spending can directly create jobs. And the $787 billion stimulus package approved by Congress in February 2009 did help pull the economy back from disaster, when it was shedding 20,000 jobs a day in late 2008 and early 2009.

But we still have a long way to go. To get back just to where we were when the recession began in December 2007, the economy would need to create 11.1 million jobs: 8.4 million to replace the jobs lost and 2.7 million to absorb new workers who have entered the labor market since then.

Despite a pickup of economic activity recently, long-term projections are that the unemployment rate will fall only gradually over the next several years. The Congressional Budget Office forecast for the unemployment rate for 2012 is a stubbornly high 8%. So why are we not moving more aggressively to reduce unemployment?

The ideological opposition to government spending remains a major obstacle. There are those who see an increase in the role of government as something to be avoided at all costs—even if the cost is the jobs of the unemployed.

It is important to note that this argument is focused on current policy, not just the long-term budgetary situation. There is room for debate about long-term budget deficits, but these are affected more by the explosive growth of health-care costs than by government discretionary spending to create jobs. Why, then, are people taken in by an argument that says it is more important to reduce the budget deficit now than for the government to spend money to create jobs? Two myths constantly repeated in the public debate have contributed to this situation:

http://www.dollarsandsense.org/archives/2010/0510wolfson.html

Corp america is taking so so many american jobs to the Government of China and India.

I say rescind all USA tax breaks for those USA corporations supporting other governments and blowing off the USA workers who made them what they are ........ or is it were?

These corporations deserve nothing from USA taxpayers.

GOOD PAYING Jobs jobs jobs jobs jobs jobs is what generates wealth for the USA.

Since it was BUSHCO who screwed up the economy and the job market aka the government makes it the responsibility of the government to find ways to reinstate the jobs somehow and send the bill to these guys:

http://rationalrevolution0.tripod.com/war/bush_family_and_the_s.htm

Cannot blame Obama for the reason 11 million are out of work..

Think about it. In the past 30 years the repub tea party has been in involved two major home loan scandals that effectively took the USA economy down the tubes. One is too damn many but twice represents repub economic policy. Wreckanomics is a failed economic policy. In fact wreckanomics is beginning to smell like well planned crimes.

The republican tea party have become masters at putting millions upon millions upon millions of people out of work. AND stealing taxpayers retirement plans along the way.

What Tea Party Repubs do with a remarkable degree of consistency is wreck the economy,initiate huge movements of shipping jobs abroad aka the Reagan-Bush Global Economy and try to wreck social security and medicare.

Is there a definite pattern? Absolutely!

1. The Reagan/ Bush Home Loan Scandal

http://rationalrevolution0.tripod.com/war/bush_family_and_the_s.htm

1. The Bush/Cheney Home Loan Scandal

http://www.dollarsandsense.org/archives/2009/0709macewan.html

1. What did Bush and Henry Paulson do with the bail out money?

http://www.democracynow.org/2009/9/10/good_billions_after_bad_one_year