Friday, March 1, 2013

Years After Deficit Pivot, Obama's Austerity is Here

I'll start by apologizing that I haven't been writing about this enough. At first I wasn't writing about it because I was positive these cuts wouldn't hit (and I'm still positive the defense side of the cuts won't actually go through), but I should have done more to make people aware of how dumb this whole project is regardless.

What is the Sequester?

These are 80+ billion dollars of cuts spread evenly between defense and non defense stuff that the government does.

Why the fuck are we cutting spending when the Economy still sucks?

Because people are really, really stupid. Over the past 3 years since Obama decided that he was President of cutting the deficit and abdicated his more traditional role of not trying to ruin the economy, there have been a series of high stakes negotiations where Obama and congressional republicans fight about who wants to cut government spending more. Each time they attempt a so called "grand bargain" where Republicans insist on a deal with only cuts to government spending, while Obama counters with a package of cuts mixed with a small tax increase on rich people and a cut to social security and/or medicare. Even when they reach a deal that is insanely tilted towards Republicans and is accepted by their leaders, the right wing of their caucus always rejects it because of some combination of not wanting to raise taxes on rich people and not wanting to be seen making a deal with the Kenyan Muslim. The most likely outcome of these deals is usually some last minute agreement to create a commission on how to cut government or lots of big sounding cuts that won't happen for the next 10 years (or at all). Until now the argument has been among all the right thinking liberals that "yes, Obama is advocating hurting the economy, but he doesn't really mean it and he's putting the Republicans in a bad political position with their own issue." Well, those days are over, and starting today, those cuts will actually begin harming economy.

But cutting government spending hurts the economy and taxing the rich doesn't help it... so EVEN HIS PROPOSAL doesn't help the economy at all. Why is he doing this?

He either:
1) Sees a political advantage in proving he cares about the deficit and is just taking it really really far
2) Thinks we need to cut government spending/social insurance.

So he's being really dumb either way?

Exactly! It's really hard to quantify how dumb this is, no matter what you want to believe about Obama's intentions. If he thinks he can prove he cares more about the deficit more than the people who "care about the deficit", then he clearly doesn't understand that NO ONE actually cares about the budget deficit. The people who claim to care about the size of the deficit actually just care about getting rid of social security/medicare/anything that helps poor people and they will never be satisfied. There is no end game for them. They will advocate "cutting the deficit" until it doesn't exist, at which point their advocacy translates into giving free money to rich people (see the Clinton Surplus/Bush Tax cuts).

So if these cuts go through, what happens?

It hurts the economy, and we may go into a recession again.

What is the likely end game at this point?

Right now it looks like the sequester cuts are going to happen for the next months, and then they will probably be wrapped up in negotiations over the Budget (which could shut down the government) and the Debt ceiling (which could crash the world economy). At this point it's really anyone's guess what the outcome is, but with both parties arguing for austerity and austerity already being implemented, my guess is that the deal will include some amount of austerity?

Will anything noticeable happen when cuts go into effect this next month?

Probably not. It seems like the various agencies will be able to juggle cuts for the next month or so, giving the  public the worst of all understandings as far as what's going on. The cuts will happen, and then there won't be noticeable changes, until later when there are noticeable changes, and by then the cuts will most likely have been baked into some sort of deal over the budget.

Are we really about to cut federal spending in a bad economy? How can this be happening?

There will always be nihilist morons who argue for these cuts no matter who is effected and what gets cut. The problem here is a president who as taken a slightly different version the conservative argument and made it the left flank of the public debate. For three years, we have had a shitty economy and a president telling the public he's trying to make it worse at absolutely every opportunity. While his words didn't cause austerity, he placed the country in a position where we have a choice between two varying types of austerity as the medicine for our economic troubles. By agreeing with the Republican psychopaths who pretend that is a major economic problem over and over and over and over he has single-handedly made countless Americans dumber. There really aren't enough expletives to describe this irresponsible and morally repugnant course of action. Republicans have shown a willingness to collapse the world economy with their actions, and to prove how reasonable he is President Obama has decided he's willing to send us into into another recession.

Fuck these people. We deserve better than a debate between two different ways of hurting the economy. 

1 comment:

  1. So remind me again why we voted for this guy?

    ReplyDelete