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“Fracturing Democracies”: The Dominant Tendency Now Is toward ‘Disaggregation’

The world’s democracies, perhaps especially our own, face a peculiar set of contradictions that are undermining faith in public endeavor and unraveling old loyalties.

There is a decline of trust in traditional political parties but also a rise in partisanship. A broad desire for governments to reduce the levels of economic insecurity and expand opportunity is constrained by a loss of confidence in the capacity of government to succeed. Intense demands for change are accompanied by fears that much of the change that is occurring will make life worse for individuals and families.

These crosscurrents are undercutting political leaders and decimating political parties with long histories. In Europe, movements on the far right and left (along with new regional parties) gain traction with disaffected citizens. Concerns about immigration reflect uneasiness among some over the social and cultural tremors in their nations. At the same time, discontent about the economic decline that afflicts regions not sharing in the global economy’s bounty calls forth protest against the privileged and the well-connected. In both cases, anger is the dominant emotion.

The convergence of these forces is especially powerful in Britain, which holds a national election on May 7 and where neither of the long-dominant Conservative and Labour Parties is likely to win a parliamentary majority. In 1951, the two parties together secured 96.8 percent of all the votes cast. This year, they are struggling to reach a combined 70 percent.

In Scotland, long a Labour stronghold, the pro-independence Scottish National Party could take as many as 50 of the region’s 59 seats, which would block British Labour leader Ed Miliband from securing a majority. But Miliband, who has run a better campaign than his foes expected, could still end up in power, partly because Prime Minister David Cameron’s Conservatives are hemorrhaging votes to the UK Independence Party, which is critical of both immigration and the European Union.

In Greece, the traditional social democratic Pasok party was nearly destroyed after the country’s economic collapse. The left-wing Syriza party took power this year because of deep frustration with economic austerity and anger over the terms being set by the European Union for a financial rescue. Far-right parties have gained ground in France and even in usually moderate Scandinavia.

In the United States, partisan splits have rarely been so deep and acrimony across party lines so intense. But these feelings don’t come from wildly positive views about the parties voters embrace. In a widely discussed paper released earlier this month, Alan Abramowitz and Steven Webster, Emory University political scientists, noted that “one of the most important trends in American politics over the past several decades has been the rise of negative partisanship in the electorate.”

It occurs, they write, when “supporters of each party perceive supporters of the opposing party as very different from themselves in terms of their social characteristics and fundamental values.” Yes, our current form of partisanship leads us to dislike not only the other side’s politicians but even each other.

And the frustrations voters feel provide each camp with ideological rocks to throw at their adversaries. In a PRRI/Brookings survey I was involved with in 2013, two findings locked horns: 63 percent of Americans said government should be doing more to reduce the gap between the rich and the poor, but 59 percent also believed government had grown bigger because it had become involved in things people should do for themselves. We want government to do more about injustice, but we also seem to want it smaller.

Stanley Greenberg, a Democratic pollster, argues in the current issue of The American Prospect that this tension is partly explained by a widespread view that “special interests” have too much of a hold on government. He argues that voters “are ready for government to help — if the stables are cleaned.”

This makes good sense, but in the United States, as elsewhere, little of what’s happening in politics is reweaving frayed social bonds. The title of Princeton University historian Daniel T. Rodgers’ revelatory 2011 book, Age of Fracture, captured what’s happening to us. In our era, he wrote, “Identities become fluid and elective,” and if the 1930s, 1940s, and 1950s were a time of political and social “consolidation,” the dominant tendency now is toward “disaggregation.”

This is a big problem for self-government, since aggregating sustainable majorities is the first task of politicians in democratic countries. They are not doing a very good job, and the unfolding 2016 campaign doesn’t inspire much confidence that they’ll do better.

 

By: E. J. Dionne, Jr., Opinion Writer, The Washington Post, April 26, 2015

April 28, 2015 Posted by | Democracy, Partisanship, Politics | , , , , , | 1 Comment

“The Obama Recovery”: You Shouldn’t Conclude That Hitting Yourself In The Head Is Smart Because It Feels So Good When You Stop

Suppose that for some reason you decided to start hitting yourself in the head, repeatedly, with a baseball bat. You’d feel pretty bad. Correspondingly, you’d probably feel a lot better if and when you finally stopped. What would that improvement in your condition tell you?

It certainly wouldn’t imply that hitting yourself in the head was a good idea. It would, however, be an indication that the pain you were experiencing wasn’t a reflection of anything fundamentally wrong with your health. Your head wasn’t hurting because you were sick; it was hurting because you kept hitting it with that baseball bat.

And now you understand the basics of what has been happening to several major economies, including the United States, over the past few years. In fact, you understand these basics better than many politicians and commentators.

Let’s start with a tale from overseas: austerity policy in Britain. As you may know, back in 2010 Britain’s newly installed Conservative government declared that a sharp reduction in budget deficits was needed to keep Britain from turning into Greece. Over the next two years growth in the British economy, which had been recovering fairly well from the financial crisis, more or less stalled. In 2013, however, growth picked up again — and the British government claimed vindication for its policies. Was this claim justified?

No, not at all. What actually happened was that the Tories stopped tightening the screws — they didn’t reverse the austerity that had already occurred, but they effectively put a hold on further cuts. So they stopped hitting Britain in the head with that baseball bat. And sure enough, the nation started feeling better.

To claim that this bounceback vindicated austerity is silly. As Simon Wren-Lewis of Oxford University likes to point out, if rapid growth after a gratuitous slump counts as success, the government should just close down half the economy for a year; the next year’s growth would be fantastic. Or as I’d put it, you shouldn’t conclude that hitting yourself in the head is smart because it feels so good when you stop. Unfortunately, the silliness of the claim hasn’t prevented its widespread acceptance by what Mr. Wren-Lewis calls “mediamacro.”

Meanwhile, back in America we haven’t had an official, declared policy of fiscal austerity — but we’ve nonetheless had plenty of austerity in practice, thanks to the federal sequester and sharp cuts by state and local governments. The good news is that we, too, seem to have stopped tightening the screws: Public spending isn’t surging, but at least it has stopped falling. And the economy is doing much better as a result. We are finally starting to see the kind of growth, in employment and G.D.P., that we should have been seeing all along — and the public’s mood is rapidly improving.

What’s the important lesson from this late Obama bounce? Mainly, I’d suggest, that everything you’ve heard about President Obama’s economic policies is wrong.

You know the spiel: that the U.S. economy is ailing because Obamacare is a job-killer and the president is a redistributionist, that Mr. Obama’s anti-business speeches (he hasn’t actually made any, but never mind) have hurt entrepreneurs’ feelings, inducing them to take their marbles and go home.

This story line never made much sense. The truth is that the private sector has done surprisingly well under Mr. Obama, adding 6.7 million jobs since he took office, compared with just 3.1 million at this point under President George W. Bush. Corporate profits have soared, as have stock prices. What held us back was unprecedented public-sector austerity: At this point in the Bush years, government employment was up by 1.2 million, but under Mr. Obama it’s down by 600,000. Sure enough, now that this de facto austerity is easing, the economy is perking up.

And what this bounce tells you is that the alleged faults of Obamanomics had nothing to do with the pain we were feeling. We weren’t hurting because we were sick; we were hurting because we kept hitting ourselves with that baseball bat, and we’re feeling a lot better now that we’ve stopped.

Will this improvement in our condition continue? Britain’s government has declared its intention to pick up the baseball bat again — to engage in further austerity, which does not bode well. But here the picture looks brighter. Households are in much better financial shape than they were a few years ago; there’s probably still a lot of pent-up demand, especially for housing. And falling oil prices will be good for most of the country, although some regions — especially Texas — may take a hit.

So I’m fairly optimistic about 2015, and probably beyond, as long as we avoid any more self-inflicted damage. Let’s just leave that baseball bat lying on the ground, O.K.?

 

By: Paul Krugman, Op-Ed Columnist, The New York Times, December 28, 2014

December 29, 2014 Posted by | Austerity, Economic Policy, Politicians | , , , , , , , , | Leave a comment

“Cheating Our Children”: The Deficit Scolds Are Actually The Bad Guys In This Story

So, about that fiscal crisis — the one that would, any day now, turn us into Greece. Greece, I tell you: Never mind.

Over the past few weeks, there has been a remarkable change of position among the deficit scolds who have dominated economic policy debate for more than three years. It’s as if someone sent out a memo saying that the Chicken Little act, with its repeated warnings of a U.S. debt crisis that keeps not happening, has outlived its usefulness. Suddenly, the argument has changed: It’s not about the crisis next month; it’s about the long run, about not cheating our children. The deficit, we’re told, is really a moral issue.

There’s just one problem: The new argument is as bad as the old one. Yes, we are cheating our children, but the deficit has nothing to do with it.

Before I get there, a few words about the sudden switch in arguments.

There has, of course, been no explicit announcement of a change in position. But the signs are everywhere. Pundits who spent years trying to foster a sense of panic over the deficit have begun writing pieces lamenting the likelihood that there won’t be a crisis, after all. Maybe it wasn’t that significant when President Obama declared that we don’t face any “immediate” debt crisis, but it did represent a change in tone from his previous deficit-hawk rhetoric. And it was startling, indeed, when John Boehner, the speaker of the House, said exactly the same thing a few days later.

What happened? Basically, the numbers refuse to cooperate: Interest rates remain stubbornly low, deficits are declining and even 10-year budget projections basically show a stable fiscal outlook rather than exploding debt.

So talk of a fiscal crisis has subsided. Yet the deficit scolds haven’t given up on their determination to bully the nation into slashing Social Security and Medicare. So they have a new line: We must bring down the deficit right away because it’s “generational warfare,” imposing a crippling burden on the next generation.

What’s wrong with this argument? For one thing, it involves a fundamental misunderstanding of what debt does to the economy.

Contrary to almost everything you read in the papers or see on TV, debt doesn’t directly make our nation poorer; it’s essentially money we owe to ourselves. Deficits would indirectly be making us poorer if they were either leading to big trade deficits, increasing our overseas borrowing, or crowding out investment, reducing future productive capacity. But they aren’t: Trade deficits are down, not up, while business investment has actually recovered fairly strongly from the slump. And the main reason businesses aren’t investing more is inadequate demand. They’re sitting on lots of cash, despite soaring profits, because there’s no reason to expand capacity when you aren’t selling enough to use the capacity you have. In fact, you can think of deficits mainly as a way to put some of that idle cash to use.

Yet there is, as I said, a lot of truth to the charge that we’re cheating our children. How? By neglecting public investment and failing to provide jobs.

You don’t have to be a civil engineer to realize that America needs more and better infrastructure, but the latest “report card” from the American Society of Civil Engineers — with its tally of deficient dams, bridges, and more, and its overall grade of D+ — still makes startling and depressing reading. And right now — with vast numbers of unemployed construction workers and vast amounts of cash sitting idle — would be a great time to rebuild our infrastructure. Yet public investment has actually plunged since the slump began.

Or what about investing in our young? We’re cutting back there, too, having laid off hundreds of thousands of school teachers and slashed the aid that used to make college affordable for children of less-affluent families.

Last but not least, think of the waste of human potential caused by high unemployment among younger Americans — for example, among recent college graduates who can’t start their careers and will probably never make up the lost ground.

And why are we shortchanging the future so dramatically and inexcusably? Blame the deficit scolds, who weep crocodile tears over the supposed burden of debt on the next generation, but whose constant inveighing against the risks of government borrowing, by undercutting political support for public investment and job creation, has done far more to cheat our children than deficits ever did.

Fiscal policy is, indeed, a moral issue, and we should be ashamed of what we’re doing to the next generation’s economic prospects. But our sin involves investing too little, not borrowing too much — and the deficit scolds, for all their claims to have our children’s interests at heart, are actually the bad guys in this story.

 

By: Paul Krugman, Op-Ed Columnist, The New York Times, March 28, 2013

April 3, 2013 Posted by | Deficits, Economic Recovery | , , , , , , , | 1 Comment

“By Their Own Hands”: While Republicans Warn Against “Greece”, That Is Exactly Where Austerity Budgeting Will Lead The U.S.

Indebted America is in danger of turning into destitute Greece, or so congressional Republicans and conservative commentators have been warning us for years now. For many reasons, this is an absurd comparison – but it may not always be quite so ridiculous if Washington’s advocates of austerity get their way.

The Republicans actually want to impose Greek-style budget-slashing on the United States. And the federal budget sequestration scheduled to take effect next week could represent the first serious step here toward the kind of fiscal policies that have proved so ruinous not only in Greece — raising unemployment, destroying hope, and encouraging extremism — but across Europe.

Nearly every day, House Speaker John Boehner or Senate Minority Leader Mitch McConnell – or Senator Rand Paul or Rep. Paul Ryan, or almost any other prominent Republican – insists that the only way to improve the economic prospects of the American people is to impose drastic budget cuts on them. While these Republican leaders don’t love the sequester budget only because it cuts too deeply into defense programs, they are eager to impose similar cuts or worse on every domestic function, from health care and education to food safety and infrastructure.

Unwilling as they usually are to name specific cuts, the Republican plans that have emerged lately are indeed similar in scope and impact to those imposed by European central bankers on Greece, Spain, Portugal, Ireland, and other beleaguered states across the continent (and imposed by the British government on the United Kingdom itself).

Enacting the same fiscal policies in this country would, presumably, induce the same effects. Yet despite their enthusiasm for extreme austerity the Republican, Tea Party, and assorted media soothsayers almost never want to discuss what has happened in Europe as a result of those same policies. It is not always possible to ignore the unhappy reality of renewed recession, from England to Italy.

Just last weekend, the British were jolted by news that Moody’s had downgraded investments in their country’s sovereign debt from its traditional AAA status.

Why would the bond rating agency do something like that? Principally because the miserable budgeting of Tory Prime Minister David Cameron’s government has mired the United Kingdom in negative growth, with no prospect of reducing its debt, which keeps growing. So the scheme that was supposed to improve the fiscal outlook for the British has merely lowered their credit rating. That wasn’t supposed to happen — in fact, the austerity plan was designed to preserve Britain’s AAA rating — but it was inevitable as soon as Downing Street chose budget-balancing over growth.

The same downward trajectory can be marked wherever the leaders of dominant Germany have forced austerity plans onto indebted governments.

So damaging has this process become for all of Europe that the Germans finally began suffering the ironic consequences in the last quarter of 2012. Their export-led growth strategies cannot work when their neighbors, reduced to poverty, can no longer purchase German goods. If German exports pick up again this year, it will only happen because customers in the U.S. and China remain exempt from the effects of austerity.

Until now, the United States has escaped the fate of Europe, remaining the “sole bright spot” of steady growth in the global economy, because President Obama resisted the fiscal extremism of his Republican adversaries, and contrived to ward off recession with necessary spending. Now sequestration, with all of its dire social and economic effects, will provide a taste of what is to come under Republican austerity: a shrunken nation with a dim future.

 

By: Joe Conason, The National Memo, February 26, 2013

February 27, 2013 Posted by | Sequester | , , , , , , , , | 2 Comments

Four Fiscal Phonies: GOP “Irresponsible Deficit Hysteria” Presidential Candidates

Mitt Romney is very concerned about budget deficits. Or at least that’s what he says; he likes to warn that President Obama’s deficits are leading us toward a “Greece-style collapse.”

So why is Mr. Romney offering a budget proposal that would lead to much larger debt and deficits than the corresponding proposal from the Obama administration?

Of course, Mr. Romney isn’t alone in his hypocrisy. In fact, all four significant Republican presidential candidates still standing are fiscal phonies. They issue apocalyptic warnings about the dangers of government debt and, in the name of deficit reduction, demand savage cuts in programs that protect the middle class and the poor. But then they propose squandering all the money thereby saved — and much, much more — on tax cuts for the rich.

And nobody should be surprised. It has been obvious all along, to anyone paying attention, that the politicians shouting loudest about deficits are actually using deficit hysteria as a cover story for their real agenda, which is top-down class warfare. To put it in Romneyesque terms, it’s all about finding an excuse to slash programs that help people who like to watch Nascar events, even while lavishing tax cuts on people who like to own Nascar teams.

O.K., let’s talk about the numbers.

The nonpartisan Committee for a Responsible Federal Budget recently published an overview of the budget proposals of the four “major” Republican candidates and, in a separate report, examined the latest Obama budget. I am not, by the way, a big fan of the committee’s general role in our policy discourse; I think it has been pushing premature deficit reduction and diverting attention from the more immediately urgent task of reducing unemployment. But the group is honest and technically competent, so its evaluation provides a very useful reference point.

And here’s what it tells us: According to an “intermediate debt scenario,” the budget proposals of Newt Gingrich, Rick Santorum, and Mitt Romney would all lead to much higher debt a decade from now than the proposals in the 2013 Obama budget. Ron Paul would do better, roughly matching Mr. Obama. But if you look at the details, it turns out that Mr. Paul is assuming trillions of dollars in unspecified and implausible spending cuts. So, in the end, he’s really a spendthrift, too.

Is there any way to make the G.O.P. proposals seem fiscally responsible? Well, no — not unless you believe in magic. Sure enough, voodoo economics is making a big comeback, with Mr. Romney, in particular, asserting that his tax cuts wouldn’t actually explode the deficit because they would promote faster economic growth and this would raise revenue.

And you might find this plausible if you spent the past two decades sleeping in a cave somewhere. If you didn’t, you probably remember that the same people now telling us what great things tax cuts would do for growth assured us that Bill Clinton’s tax increase in 1993 would lead to economic disaster, while George W. Bush’s tax cuts in 2001 would create vast prosperity. Somehow, neither of those predictions worked out.

So the Republicans screaming about the evils of deficits would not, in fact, reduce the deficit — and, in fact, would do the opposite. What, then, would their policies accomplish? The answer is that they would achieve a major redistribution of income away from working-class Americans toward the very, very rich.

Another nonpartisan group, the Tax Policy Center, has analyzed Mr. Romney’s tax proposal. It found that, compared with current policy, the proposal would actually raise taxes on the poorest 20 percent of Americans, while imposing drastic cuts in programs like Medicaid that provide a safety net for the less fortunate. (Although right-wingers like to portray Medicaid as a giveaway to the lazy, the bulk of its money goes to children, disabled, and the elderly.)

But the richest 1 percent would receive large tax cuts — and the richest 0.1 percent would do even better, with the average member of this elite group paying $1.1 million a year less in taxes than he or she would if the high-end Bush tax cuts are allowed to expire.

There’s one more thing you should know about the Republican proposals: Not only are they fiscally irresponsible and tilted heavily against working Americans, they’re also terrible policy for a nation suffering from a depressed economy in the short run even as it faces long-run budget problems.

Put it this way: Are you worried about a “Greek-style collapse”? Well, these plans would slash spending in the near term, emulating Europe’s catastrophic austerity, even while locking in budget-busting tax cuts for the future.

The question now is whether someone offering this toxic combination of irresponsibility, class warfare, and hypocrisy can actually be elected president.

 

By: Paul Krugman, Op-Ed Columnist, The New York Times, March 1, 2012

March 2, 2012 Posted by | Election 2012, GOP Presidential Candidates | , , , , , , , | 2 Comments

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