“Deficits don’t matter.” — Dick Cheney, 2002
For more than a year, I’ve watched in sheer amazement as Republicans — fueled by the Tea Party — bludgeoned Democrats, especially President Obama, for blowing a hole in the federal budget. I’m amazed because it was the administration of George W. Bush, assisted by a GOP-dominated Congress, that squandered the surplus left by President Bill Clinton. By the time Obama assumed office, the country was already floating in a sea of red ink.
Yet, the conventional wisdom among so-called moderates has been that Obama should bite the bullet and take responsibility for shrinking the deficit. Never mind that most mainstream economists, including Federal Reserve Chairman Ben Bernanke (a Republican), say that the government should spend freely during a period of high unemployment in order to create demand for jobs. As the Great Depression taught us, the government shouldn’t freeze spending during hard economic times.
(Note: One of the reasons that the unemployment rate has stayed high is that state and local governments keep laying people off, and the public sector has not stepped in to fill the gap by hiring more workers. If the federal stimulus bill had been bigger — giving states more money — cops and teachers could have kept their jobs and the jobless rate would be lower.)
The blame-Obama theory was on display in a recent column by NYT columnist David Brooks:
Obama would be wiser to champion a Grand Bargain strategy. Use the Congressional deficit supercommittee to embrace the sort of new social contract we’ve been circling around for the past few years: simpler taxes, reformed entitlements, more money for human capital, growth and innovation.
Don’t just whisper Grand Bargain in back rooms with John Boehner. Make it explicit. Take it to the country. Lower the ideological atmosphere and get everybody thinking concretely about the real choices facing the nation.
That’s nonsense. As Brooks indicated in an earlier passage, Obama tried to strike up a Grand Bargain, and House Speaker John Boehner shoved it back in his face. If Obama kept going back to Republicans, begging them to negotiate, he’d look like a wimp. Republicans are never going to agree to a fair deal that includes tax increases, no matter how much Democrats offer in cuts.
Just yesterday, the GOP rejected another deal that included massive cuts, along with some tax increases. The Republican Party does not care about deficits. They only care about defeating Obama and protecting the rich. That’s it. Oh — and securing their rightwing theocracy.
Obama finally got the message and stopped being a patsy. That’s good news.