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Friday, November 18, 2011

Paul Krugman: Failure Is Good

The failure to do a bad thing is a good thing:

Failure Is Good, by Paul Krugman, Commentary, NY Times: It’s a bird! It’s a plane! It’s a complete turkey! It’s the supercommittee!
By next Wednesday, the so-called supercommittee, a bipartisan group of legislators, is supposed to reach an agreement on how to reduce future deficits. Barring an evil miracle — I’ll explain the evil part later — the committee will fail to meet that deadline. ...
Why was the supercommittee doomed to fail? Mainly because ... Republicans and Democrats don’t just have different priorities; they live in different intellectual and moral universes.
In Democrat-world, up is up and down is down. Raising taxes increases revenue, and cutting spending while the economy is still depressed reduces employment. But in Republican-world, down is up. The way to increase revenue is to cut taxes on corporations and the wealthy, and slashing government spending is a job-creation strategy. ...
Moreover, the parties have sharply different views of what constitutes economic justice. Democrats see social insurance programs, from Social Security to food stamps, as serving the moral imperative of providing basic security to our fellow citizens and helping those in need.
Republicans have a totally different view..., they view the welfare state as immoral, a matter of forcing citizens at gunpoint to hand their money over to other people. ...
Why did anyone think this would work?
Well, maybe the idea was that the parties would compromise out of fear that there would be a political price for seeming intransigent. But this could only happen if the news media were willing to point out who is really refusing to compromise. And they aren’t..., the G.O.P. pays no price for refusing to give an inch.
So the supercommittee will fail — and that’s good.
For one thing, history tells us that the Republican Party would renege on its side of any deal as soon as it got the chance. ... So any deal reached now would, in practice, be nothing more than a deal to slash Social Security and Medicare, with no lasting improvement in the deficit.
Also, any deal reached now would almost surely end up worsening the economic slump. Slashing spending while the economy is depressed destroys jobs... Better to have no deal than a deal that imposes spending cuts in the next few years. ...
Eventually, one side or the other of that divide will get the kind of popular mandate it needs to resolve our long-run budget issues. Until then, attempts to strike a Grand Bargain are fundamentally destructive. If the supercommittee fails, as expected, it will be time to celebrate.

    Posted by on Friday, November 18, 2011 at 01:17 AM in Budget Deficit, Economics, Politics | Permalink  Comments (29)


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