It turns out that stripping workers’ rights, cutting the safety net, funneling money away from public schools, firing thousands of public workers, and doing the bidding of corporate donors doesn’t create a strong economy.
Like many observers, I usually read reports about political goings-on with a sort of weary cynicism. Every once in a while, however, politicians do something so wrong, substantively and morally, that cynicism just won’t cut it; it’s time to get really angry instead. So it is with the ugly, destructive war against food stamps.
The food stamp program … tries to provide modest but crucial aid to families in need. And the evidence is crystal clear both that the overwhelming majority of food stamp recipients really need the help, and that the program is highly successful at reducing “food insecurity,” in which families go hungry at least some of the time.
Paul Krugman, From the Mouths of Babes
I highly recommend reading the entire column; it’s well worth the time.
Competition from China and other low-wage rivals, coupled with fallout from the 2007-‘09 financial crisis, has put American wages under such unprecedented strain that they have shifted into reverse — not merely stagnating, but falling.
And Wisconsin workers have been hit especially hard:
Among the states most affected is Wisconsin.
According to the Bureau of Labor Statistics, private-sector wages in Wisconsin fell 2.2% in the 12 months ended September 2012, ranking the state 44th out of 50. The rate was double the drop in the national average.
The question of who “won” the fiscal cliff won’t be answered till we know what happens when Congress reaches the debt ceiling. The White House says that there’ll be no negotiations over the debt ceiling, and that if Republicans want further spending cuts, their only chance is to hand over more tax revenue. If they’re right and they do manage to enforce a 1:1 ratio of tax hikes to spending cuts in the next deal, they’re going to look like geniuses.
Republicans swear they are crazy enough to push the country into default, and they promise that the White House isn’t strong enough to stand by and let it happen. If they’re right, and the White House agrees to big spending cuts absent significant tax increases in order to avert default, then Republicans will have held taxes far lower than anyone thought possible.
But both Republicans and Democrats can’t be right.
--Ezra Klein (via andrewgraham)
There Is (Economic) Power in a Union: An Illustrated Guide
Who are the real “job creators”? Contrary to conventional wisdom, the answer seems to be: People who have jobs – particularly those that pay well. Well-paid employees buy things, and that creates jobs for other people.
And what creates those kinds of jobs? A healthy union movement. Unions are also a bulwark against income inequality, an economic distortion which even conservative Forbes magazine acknowledges is bad for the economy.
It looks to all the world as if there’s a correlation here: Union membership goes down – deficits go up. Perhaps the correlation isn’t as strong as it looks, but the idea isn’t crazy. Higher-paid employees pay more in taxes, which is good for the government’s bottom line. They require fewer government services. The same is true of their families, neighborhoods, and communities. And their contribution to economic growth means everybody’s better off.
The lesson for all those deficit-obsessed policymakers might be, to paraphrase the late Joe Hill: Don’t “austerize,” organize.
Maybe that’s why the 1956 Republican Party platform boasted that under the leadership of President Eisenhower “unions have grown in strength and responsibility, and have increased their membership by 2 millions.” They knew what was good for the economy … and good for business.
Republicans claim to be for much smaller government, but as a political matter they have always attacked government spending in the abstract, never coming clean with voters about the reality that big cuts in government spending can happen only if we sharply curtail very popular programs.
…if you look at the facts, you learn that the great bulk of those who pay no income tax pay other taxes; also, many of the people in the no-income-tax category are (a) elderly (b) students or (c) having a bad year, having lost a job — that is, they’re people who have paid income taxes in the past and/or will pay income taxes in the future. The idea that half of Americans are just grifters is grotesque.
Stop, hey, what’s that sound? Actually, it’s the noise a great political party makes when it loses what’s left of its mind. And it happened — where else? — on Fox News on Sunday, when Mitt Romney bought fully into the claim that gas prices are high thanks to an Obama administration plot. This claim isn’t just nuts; it’s a sort of craziness triple play — a lie wrapped in an absurdity swaddled in paranoia. It’s the sort of thing you used to hear only from people who also believed that fluoridated water was a Communist plot. But now the gas-price conspiracy theory has been formally endorsed by the likely Republican presidential nominee.
--Paul Krugman, Paranoia Strikes Deeper. Krugman tears down the Republican idea that the Obama administration is pushing for higher gas prices.