“The Poisoning Of Flint”: A Nightmarish Example Of How Misguided Austerity Policies Can Literally Poison The Public
In early 2015, shortly after his victory in a heated reelection contest, Michigan Gov. Rick Snyder (R) began exploring a run for president. With his business experience and electoral success in a blue state, Snyder was considered a viable potential candidate, so he embarked on a national speaking tour and set up a fundraising organization. Its name: “Making Government Accountable.”
As Snyder was testing the presidential waters, however, his government was being shamefully unaccountable to constituents who were concerned about their water supply. The city of Flint switched its primary water source from Lake Huron, through Detroit’s system, to the Flint River in April 2014. Approved by an emergency manager appointed by the governor, the move was supposed to save the beleaguered city millions of dollars. But residents soon began reporting tap water that appeared discolored, smelled rotten and caused kids to break out in rashes. Today, Flint has become a nightmarish example of how misguided austerity policies can literally poison the public.
We now know that Flint’s water supply was contaminated by lead that it collected from deteriorating pipes. In recent weeks, Snyder has issued a public apology to the city, declared a state of emergency, activated the National Guard and requested assistance from President Obama, who declared the situation a federal emergency on Saturday. The state health department is also looking into whether an outbreak of Legionnaires’ disease that has killed 10 people in the area is connected to the water crisis. Meanwhile, the Justice Department is investigating the state and local government’s actions, while it could cost up to $1.5 billion to fix the city’s water distribution system.
All of this is the result of the Snyder administration’s stunning lack of accountability, beginning with the fateful decision to put Flint under the control of a political appointee who was unelected and unaccountable to the public. When the city’s residents initially reported their concerns in 2014, officials responded by pumping hazardous levels of chlorine into the water. When complaints persisted, officials assured citizens that the water was safe to drink, repeatedly disregarding clear evidence that it wasn’t. But when elevated levels of lead showed up in children’s blood this past fall, the government was forced to admit there was a problem. Snyder appointed a task force to investigate the crisis, which found, among other things, that legitimate fears were met with “aggressive dismissal, belittlement, and attempts to discredit” the individuals speaking out.
“They cut every corner,” said Flint resident Melissa Mays. “They did more to cover up than actually fix it. That’s criminal.” Snyder’s then chief of staff, Dennis Muchmore, acknowledged the administration’s deplorable response in a July 2015 email, writing: “These folks are scared and worried about the health impacts and they are basically getting blown off by us (as a state we’re just not sympathizing with their plight).”
But the water crisis in Flint represents more than a catastrophic political failure. It is also a direct consequence of decades of policies based on the premise that government spending is always a problem and never a solution. Long before Flint tried to reduce spending by moving to a cheaper water source, the pipes that ultimately poisoned the water were neglected. Across the country, crumbling infrastructure is a pervasive threat that is creating serious issues in other cities and could produce similar crises . As Michigan State University economist Eric Scorsone explained , “Flint is an extreme case, but nationally, there’s been a lack of investment in water infrastructure. This is a common problem nationally — infrastructure maintenance has not kept up.”
Unfortunately, the biggest obstacles to desperately needed public investments are politicians like Snyder who conflate “accountability” with austerity. For Republican technocrats in particular, more accountability almost always means less spending on government programs that help ensure the public good.
With less than a month until the Iowa caucus, the conventional wisdom is that voters are fed up and that their anger is reflected in the polls. That frustration and distrust of government is understandable when politicians like Snyder and their cronies are so blatantly unaccountable to the public. Indeed, when government is polluted by officials who put corporate interests above their constituents and cost-cutting above the common good, it too often fails to fulfill even its most basic functions, such as protecting access to safe drinking water. But instead of giving in to anger and austerity, in this election, we should be having a vigorous debate about how government can be truly accountable to the people it serves.
By: Katrina vanden Heuvel, Opinion Writer, The Washington Post, January 18, 2016
“The Politics Of The Deficit Are Utterly Backward”: Ignore The Rending Of Garments From Deficit Paranoiacs
One of the most frustrating things about being a lefty during the depths of the Great Recession was watching giant policy errors build on the horizon like some sewage tsunami, and being powerless to stop them. And in 2010 the biggest and sewage-iest of the errors was the turn to austerity — the combination of budget hikes and spending increases that has slowed economic recovery across the developed world.
Five years later, as the deficit has fallen dramatically and so has interest in its supposed danger, it provides an interesting window into the politics of deficit paranoia — and how it is 180 degrees from reality.
Let me quickly review the story up to the present. A recession means the economy is suffering a shortage of aggregate demand. People are losing their jobs, meaning companies have fewer sales, so they fire employees or go out of business — rinse and repeat. The standard response to this is economic stimulus, both monetary and fiscal. For the former, the Federal Reserve cuts interest rates, making loans easier to get and thus stoking the economy; for the latter, the government borrows and spends directly, mechanically jacking up total spending.
Like the Great Depression, fiscal stimulus was particularly important during the Great Recession, because by late 2008, the Fed had cut interest rates all the way to zero — pushing its economic accelerator all the way to the floor — and it didn’t halt or even much slow down the recession.
Initially, with big Democratic Party majorities in both the House and Senate, the government did the right thing. Right after President Obama took office, it passed the Recovery Act, a fairly sizable piece of fiscal stimulus. But as trusted center-left commentators like Paul Krugman pointed out, it wasn’t nearly big enough to fill the economic hole visible at the time — and later measurements would show the hole to be vastly larger than the initial estimates.
So after that first round of stimulus, the deficit was very large due to all the borrowing. However, its inadequacy was also obvious, as unemployment plateaued at nearly 10 percent — then stayed there for an entire year. During and immediately after the crisis, the centrist establishment was too shocked to respond, but they eventually regrouped and began demanding immediate cuts to balance the budget — effectively aligning themselves with resurgent conservatives, who as usual demanded all social insurance programs be torched.
After the 2010 election, the centrists and conservatives got much of what they supposedly wanted: tons of austerity, most of it in cuts to government spending (particularly when compared to previous presidencies). The effects were obvious: a recovery that was grindingly slow and weak. It still shows no sign of returning to the previous trend.
In other words, austerians were successful in cutting the short-term deficit at the worst imaginable time. But what about now, as the economy is returning to at least a modicum of health? According to the standard economic script, government deficits aren’t always good. When recovery has been reached, then it’s time to cut back. “The boom, not the slump, is the right time for austerity at the Treasury,” as John Maynard Keynes said (though adherents of Modern Monetary Theory would quibble with this).
What are the centrist austerians doing? Why, they’ve gone almost totally silent, of course. Ron Fournier, the avatar of D.C. centrism and a fanatical austerian, has barely mentioned the subject over the last year. More broadly, as Andrew Flowers documents for FiveThirtyEight, mentions of “deficit” and “debt” by Republican presidential candidates have fallen by about two-thirds since 2012. Mentions in Congress have fallen even further.
This demonstrates that the conventional politics around deficits and debt are fundamentally disconnected from any sort of rational understanding as to why they might be a problem. And due to those same actual mechanics, the political salience of austerity moves in inverse proportion to its real importance — insane overreaction when the deficit should be very high, bland disinterest when it ought to be coming down again.
It’s maddening, but at least predictable. The next time a liberal administration is in charge during a recession, it may safely ignore the rending of garments from deficit paranoiacs. As soon as the immediate crisis is over, they’ll quickly forget all about it.
By: Ryan Cooper, The Week, January 15, 2016
“Empowering The Ugliness”: The Strategies Elites Traditionally Used On Those Angry Voters Have Finally Broken Down
We live in an era of political news that is, all too often, shocking but not surprising. The rise of Donald Trump definitely falls into that category. And so does the electoral earthquake that struck France in Sunday’s regional elections, with the right-wing National Front winning more votes than either of the major mainstream parties.
What do these events have in common? Both involved political figures tapping into the resentments of a bloc of xenophobic and/or racist voters who have been there all along. The good news is that such voters are a minority; the bad news is that it’s a pretty big minority, on both sides of the Atlantic. If you are wondering where the support for Mr. Trump or Marine Le Pen, the head of the National Front, is coming from, you just haven’t been paying attention.
But why are these voters making themselves heard so loudly now? Have they become much more numerous? Maybe, but it’s not clear. More important, I’d argue, is the way the strategies elites have traditionally used to keep a lid on those angry voters have finally broken down.
Let me start with what is happening in Europe, both because it’s probably less familiar to American readers and because it is, in a way, a simpler story than what is happening here.
My European friends will no doubt say that I’m oversimplifying, but from an American perspective it looks as if Europe’s establishment has tried to freeze the xenophobic right, not just out of political power, but out of any role in acceptable discourse. To be a respectable European politician, whether of the left or of the right, you have had to accept the European project of ever-closer union, of free movement of people, open borders, and harmonized regulations. This leaves no room for right-wing nationalists, even though right-wing nationalism has always had substantial popular support.
What the European establishment may not have realized, however, is that its ability to define the limits of discourse rests on the perception that it knows what it is doing. Even admirers and supporters of the European project (like me) have to admit that it has never had deep popular support or a lot of democratic legitimacy. It is, instead, an elite project sold largely on the claim that there is no alternative, that it is the path of wisdom.
And there’s nothing quite like sustained poor economic performance – the kind of poor performance brought on by Europe’s austerity and hard-money obsessions — to undermine the elite’s reputation for competence. That’s probably why one recent study found a consistent historical relationship between financial crises and the rise of right-wing extremism. And history is repeating itself.
The story is quite different in America, because the Republican Party hasn’t tried to freeze out the kind of people who vote National Front in France. Instead, it has tried to exploit them, mobilizing their resentment via dog whistles to win elections. This was the essence of Richard Nixon’s “southern strategy,” and explains why the G.O.P. gets the overwhelming majority of Southern white votes.
Sooner or later the angry whites who make up a large fraction, maybe even a majority, of the G.O.P. base were bound to rebel — especially because these days much of the party’s leadership seems inbred and out of touch. They seem, for example, to imagine that the base supports cuts to Social Security and Medicare, an elite priority that has nothing to do with the reasons working-class whites vote Republican.
So along comes Donald Trump, saying bluntly the things establishment candidates try to convey in coded, deniable hints, and sounding as if he really means them. And he shoots to the top of the polls. Shocking, yes, but hardly surprising.
Just to be clear: In offering these explanations of the rise of Mr. Trump and Ms. Le Pen, I am not making excuses for what they say, which remains surpassingly ugly and very much at odds with the values of two great democratic nations.
What I am saying, however, is that this ugliness has been empowered by the very establishments that now act so horrified at the seemingly sudden turn of events. In Europe the problem is the arrogance and rigidity of elite figures who refuse to learn from economic failure; in the U.S. it’s the cynicism of Republicans who summoned up prejudice to support their electoral prospects. And now both are facing the monsters they helped create.
By: Paul Krugman, Op-Ed Columnist, The New York Times, December 11, 2015
“Austerity’s Grim Legacy”: Deficit Fetishism Was Both Wrongheaded And Destructive
When economic crisis struck in 2008, policy makers by and large did the right thing. The Federal Reserve and other central banks realized that supporting the financial system took priority over conventional notions of monetary prudence. The Obama administration and its counterparts realized that in a slumping economy budget deficits were helpful, not harmful. And the money-printing and borrowing worked: A repeat of the Great Depression, which seemed all too possible at the time, was avoided.
Then it all went wrong. And the consequences of the wrong turn we took look worse now than the harshest critics of conventional wisdom ever imagined.
For those who don’t remember (it’s hard to believe how long this has gone on): In 2010, more or less suddenly, the policy elite on both sides of the Atlantic decided to stop worrying about unemployment and start worrying about budget deficits instead.
Some of us tried in vain to point out that deficit fetishism was both wrongheaded and destructive, that there was no good evidence that government debt was a problem for major economies, while there was plenty of evidence that cutting spending in a depressed economy would deepen the depression.
And we were vindicated by events. More than four and a half years have passed since Alan Simpson and Erskine Bowles warned of a fiscal crisis within two years; U.S. borrowing costs remain at historic lows. Meanwhile, the austerity policies that were put into place in 2010 and after had exactly the depressing effects textbook economics predicted; the confidence fairy never did put in an appearance.
Yet there’s growing evidence that we critics actually underestimated just how destructive the turn to austerity would be. Specifically, it now looks as if austerity policies didn’t just impose short-term losses of jobs and output, but they also crippled long-run growth.
The idea that policies that depress the economy in the short run also inflict lasting damage is generally referred to as “hysteresis.” It’s an idea with an impressive pedigree: The case for hysteresis was made in a well-known 1986 paper by Olivier Blanchard, who later became the chief economist at the International Monetary Fund, and Lawrence Summers, who served as a top official in both the Clinton and the Obama administrations. But I think everyone was hesitant to apply the idea to the Great Recession, for fear of seeming excessively alarmist.
At this point, however, the evidence practically screams hysteresis. Even countries that seem to have largely recovered from the crisis, like the United States, are far poorer than precrisis projections suggested they would be at this point. And a new paper by Mr. Summers and Antonio Fatás, in addition to supporting other economists’ conclusion that the crisis seems to have done enormous long-run damage, shows that the downgrading of nations’ long-run prospects is strongly correlated with the amount of austerity they imposed.
What this suggests is that the turn to austerity had truly catastrophic effects, going far beyond the jobs and income lost in the first few years. In fact, the long-run damage suggested by the Fatás-Summers estimates is easily big enough to make austerity a self-defeating policy even in purely fiscal terms: Governments that slashed spending in the face of depression hurt their economies, and hence their future tax receipts, so much that even their debt will end up higher than it would have been without the cuts.
And the bitter irony of the story is that this catastrophic policy was undertaken in the name of long-run responsibility, that those who protested against the wrong turn were dismissed as feckless.
There are a few obvious lessons from this debacle. “All the important people say so” is not, it turns out, a good way to decide on policy; groupthink is no substitute for clear analysis. Also, calling for sacrifice (by other people, of course) doesn’t mean you’re tough-minded.
But will these lessons sink in? Past economic troubles, like the stagflation of the 1970s, led to widespread reconsideration of economic orthodoxy. But one striking aspect of the past few years has been how few people are willing to admit having been wrong about anything. It seems all too possible that the Very Serious People who cheered on disastrous policies will learn nothing from the experience. And that is, in its own way, as scary as the economic outlook.
By: Paul Krugman, Op-Ed Columist, The New York Times, November 6, 2015
Share This Blog
mykeystrokes.com- “The Unrelenting Hostility Of Washington’s Courtier Press”: The Media’s Crusade Of Scandals Against Hillary Clinton
- “Endorsing This Philistine”: The Christian Right Has Surrendered To Trump
- “Cop Killers Serve No Cause”: It’s Getting To The Point Where No Lives Matter
- “We’re Not Post-Racial Yet”: The Demons Of Our Racist Past Still Haunt Us
- “Ghosts Of History”: Why America Recoils From Donald Trump
mykeystrokes.com 