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Remember these words from Paul Krugman last week?
In anticipation of President Obama's State of the Union address this coming Tuesday, Chris Hayes asked what economist Paul Krugman (who has been right about economic issues all along, mind you) what he would like to hear in the address. While acknowledging with resignation that he probably won't get his wish, Krugman responds that he'd rather not hear the legitimization of deficit pearl clutching and advocation of austerity measures.
Like the rest of us liberals clamoring to be heard through the self-protecting insulation of the Beltway Bubble, Krugman makes the point that none of what he's advocated is more sophisticated than Econ 101, a class one would assume that every college graduate (which would be most members of Congress ) has taken. Yet these very basic economic concepts are alien to the Beltway.
It’s a very insular culture in Washington. It’s one of people who hang out together, who talk to each other, who don’t listen…what’s odd about my position on this stuff is I am, for the most part, not doing any kind of odd, unorthodox economics. I’m doing Macroeconomics 101, but that is not what people in DC hear. It’s not that they just don’t accept it. For the most part, they haven’t even heard about it. The notion that oh, the budget deficit is not a problem when the economy is depressed is barely in the Washington discourse. And because I’m still in touch with Macroeconomics 101, I’m really sort of out of it.
I've said it before and I'll say it again: we already know the solutions to our economic woes. We've gotten out of them before and we know what works. It has never been cutting spending and lowering taxes, no matter how many Republicans get booked on the Sunday shows to flood the discourse.
But in a sad addition to the "both sides do it" meme, the fact remains that even though these basic economic concepts and solutions remain patently obvious to those of us outside the Beltway Bubble, even those who should understand and embrace Keynesian economics miss the point, continually, as Dan Pfeiffer proves with this White House blog:
With less than three weeks before devastating, across the board cuts - the so-called "sequester" - are slated to hit, affecting our national security, job creation and economic growth, we must make sure we are having a debate over how to deal with these looming deadlines that is based on facts- not myths being spread by some Congressional Republicans who would rather see these cuts hit than ask the wealthiest and big corporations to pay a little bit more.
First, the notion that President Obama hasn't put forward a solution to deal with these looming cuts is false. In the fall of 2011, the President put forward a proposal to the Supercommittee for the specific purpose of laying out his vision to resolve the sequester and reduce our deficit by over $4 trillion dollars in a balanced way- by cutting spending, finding savings in entitlement programs and asking the wealthiest to pay their fair share. That proposal would have completely turned off the sequester while further reducing our deficit and ensuring we could still invest in the things we need to grow our economy and create jobs. That same approach was presented to Congress in the President's budget last year. And the President's last offer to Speaker Boehner in December remains on the table- an offer that meets the Republicans halfway on spending and on revenues, and would permanently turn off the sequester and put us on a fiscally sustainable path.
We should have a debate over how to best reduce the deficit. But with only three weeks until these indiscriminate cuts hit, Congress should find a short term package to give themselves a little more time to find a solution to permanently turn off the sequester. That package should have balance and include spending cuts and revenues.
Why on earth do we accept the framing of these ill-informed, petulant children on how the economy works instead of demanding that we adopt the measures that brought this country back into unprecedented levels of prosperity for most of its citizens after the Great Depression? When do the adults with the real solutions get their place at the table?
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