On the Contrary

Remember that our conservative friends were totally against the stimulus bill.  Then they loaded it up with tax breaks saying that only creating private sector jobs would do any good.  Now they are saying it failed to create the number of jobs promised.  Apparently all those tax breaks weren’t all that effective.  What was effective were the jobs that were not lost in each of the states, especially teaching jobs due to stimulus money.  So let’s just think this through.  You know, apply logic instead of emotion and ideology.  Remember that except for three Republicans, the rest wanted to do nothing.  “Let them eat cake.”

First of all let’s look at cutting taxes to stimulate the economy.  If we were in a mild recession, this might not be a bad idea.  If people weren’t loosing their jobs, then giving business an incentive to hire or replace equipment might be an effective way to stimulate demand.  But in the current situation, there is no demand because the economy is shrinking* and people are losing their jobs.  Why would I hire someone or replace equipment for demand that does not exist?  In other words, in an extreme recession, why would I take the risk on expansion when there is no one to buy my increasing inventory?  I would venture that if you made the tax rate 0% right now, it would not have any impact except on Wall Street where they bet on derivatives, not create capital for new businesses.

Let’s just take little old me as an example.  When I get a consulting check, I sock 37% away for taxes that I have to pay quarterly.  37% is what I have computed over the years to make sure I don’t owe anything come April.  Now if you reduced my taxes from earnings to zero I would have a nice chunk of change I could spend, and so the theory goes, I would stimulate the economy with this spending.  The trouble with this simple minded conservative thinking is I would not spend it.  Times are tough and I am not sure when the next job is coming so I want as much money stashed away as possible as a pad for the future.  No stimulus there. This is generally what economists will tell will happen with tax cuts in a severe recession, but if the only thing you know how to say is tax cuts, then, well, you prescribe it no matter what.  It’s all you got.

So if demand is shrinking, and tax cuts are not going to stimulate private spending, what you have left is public spending.  Oh how conservatives hate this.  The usual complaint is two parts.  It increases the deficit and government jobs are not real jobs that sustain the economy.  So let’s take one at a time:  It is very true that this spending will raise deficits, but so will tax cuts.  Either way the effect is the same on the deficit and our treasury.  Oh but private jobs are self-sustaining while government jobs are dependent on continued spending.  Well, yes and no.

First of all there are no private jobs to be had and they are shrinking.  So the government has a couple of choices.  It wants to stimulate the economy by giving the economy money that will be spent.  That means you give it to people that will spend it, people on the margins.  That generally means you fund state programs.  That is why the job numbers created are teacher’s jobs that would have probably been cut.  You also fund help for indigent (social programs) and that money is also spent.  Is that stimulative?   Of course it is since those people spend money that fuels private sector jobs.  Without it, many more jobs in the private sector would have gone away just further shrinking the demand and the problem.  Same result is achieved with construction/infrastructure projects.  The benefit of this kind of spending is that not only do you at least keep the economy working, you get something for your money, either in your kid’s education (teachers jobs), or needed infrastructure improvements.

To the question of are these make-work jobs that are dependent on continued government spending, the answer is not really.  The government is trying to maintain the services and infrastructure improvements to stimulate the economy until the tax base can once again support these critical services.  The private sector is moribund.  There is no other option.  Well that’s not quite true.  You can follow the conservatives lead and just let the economy collapse and sooner, or more likely later, things will restore themselves.  The collateral damage is not their concern.

Their concern and bogeyman is the deficit.  Okay it is a concern.  But they don’t bat an eye about billions for Iraq and Afghanistan, they don’t see the defense industry as a government program, and they wouldn’t hesitate to cut education, health care, or whatever to support these giant programs.  I don’t think it means a hill of beans to have the strongest military in the world if our economy is a shambles.  Is the deficit something we should worry about?  Of course, but right now we have to get things moving or the deficit is going to get much worse than what this spending will cause.  Later on we will have the fight with conservatives once again to set reasonable tax rates to pay off the borrowing we need to do today.  It is called shared sacrifice which is totally alien to their mind set.  They are on the wrong side of almost every issue because their ideology has constipated their brains and of course the status quo (those that got rich in the existing climate) pays them not to think.

And yes we need another stimulus, as the first one was too small and not targeted to things that would fuel the economy with spending.  Thank you conservatives for that.  That includes some of those moron conservative Democrats that the press continues to falsely refer to as moderates.  This stimulus package or whatever they want to call it, ought to be more focused, to help those out of work (extending unemployment) and real investments in tomorrow. Forget about bipartisanship because the conservatives will try to keep anything from happening.  They will scare the rabble with the fear of deficits while setting the country up to bankrupt the poor.  Nothing ever changes and you would think sooner or later people would wake up to going nowhere.

*While the economy grew 3.5%, most of that was due to replacement of inventory, reduction of workforce , and longer work hours, while unemployment continued to increase.  Even the Stock Market has figured this out as it fell on the weak outlook.  Things are going to get worse, not better without a new stimulus plan.

The Republicans are grabbing at straws.  Of course the pundits keep asking them amazingly stupid questions which fail to recognize what is going on here.  What I think we are witnessing is not some election where the voters are mad at the Republicans and just want somebody else.  What we are witnessing is a rejection of Reaganism and the last 30 years of conservative philosophy.  It just hasn’t worked and we are in a mess.  The mess is not because the Republicans were not true to their principals, but because they were true to them and most people are getting it.

These pundits keep focusing on basically flawed questions like why couldn’t the McCain campaign focus on one message that would resonate with the voters.  The answer is clear:  They don’t have one.  The one that does resonate is the one that rejects their message.  It is not about some crystallization of a conservative approach to our future.  They have failed.  Conservatism has run its course.  That is why the Republicans have focused on trying to defame Barack’s character as an American hating, socialist, who has ties to terrorists.  It’s a lie, but it is all they have.  The voters have already rejected their position on issues so what else could you run on except character and character smears?

I watched Duncan Hunter, a very conservative Republican from California explain to some media person that if only John McCain had focused on international threats he would be leading now.  Then we got the litany of how we are winning in Iraq to which the media person asked how we are winning if we are still stuck there and spending $10 billion a month.  That is how out of touch these people are.  Most Americans just want out so we can focus on the great problems we are facing at home and the Republican approach is we will bring victory, whatever that means.  Its good flag waving fodder for their base, but for those who think deeply about our future, we have done what we can do and it is time to disengage.  In the language of cost benefit ratios, we can gain a greater benefit in our national security by investing our money and people elsewhere.  Slogans are not working any more and thoughtful nuanced policy is not Republican forte.

On NPR’s Talk of the Nation, I listened as Neil Conan’s guest made the argument that you should elect John McCain in order to provide a balanced government and that the American people are afraid of one party being in control.  Once again both Neil and his guest totally misunderstood this election.  It is not just that the voters are mad at the Republicans, and so are looking for a balance.  It is that they have decided they want to jettison the Republican orthodoxy and they want to try something new.  They don’t want baby steps that long fights and compromises will bring, where Republicans will fight reform every step of the way.  They want to step off smartly in a new direction.  They are going to deliver the government to the Democrats and give them a chance and the Democrats will have two years to show what they can do.  For those who are afraid of single party control, note that the Democrats who might win election in these swing states are not what one would call left wing Democrats.  They are very practical politicians who are just not wedded to a conservative ideology.

But the Republicans are beginning to understand the wave of change that is bearing down on them and they are terrified.  Their arguments and their fear mongering is gaining no traction except among their pathetic base and they don’t know what to do.  Watch their spinners try to explain what is going on.  The body language and the fear in their eyes belies their smiles.  Their stretches of reality are getting longer and longer.  “This election would have been impossible to win anyway because of George Bush’s unfavorable ratings” as though this is just about George Bush.  It is not.  It is about conservatism and George was a good conservative.  McCain’s real problem is the basic thesis and message of the Obama campaign:  He had nothing to offer except more conservative ideology only maybe applied with more expertise and people are rejecting it.

Conservatives are going to tell you that this was about the mountains of money that Barack Obama had.  Some of that is true, but in the past Republicans have had tons of money, mostly from their lobbyists.  Barack’s average campaign contribution was $75 and it came from all over the country from people like me who are voting with their wallet.  Some will tell you that if the economy had not gone south when it did, McCain and the republicans would have won.  Once again that ignores the unfavorable ratings before the economy crashed.  Most people understood that the Republican party is about the status quo and protecting the wealthy.  The dramatic turn on Wall Street simply underscored the bankruptcy of their ideas.

So the desperation you see in the Republicans is not just about losing an election.  It is much more basic to them than that.  It is about losing power and control.  It is about having everything they believe in rejected.  They are terrified because without their conservative religion they are rudderless.  They will be the last to finally open their eyes and see that what they have wrought is just the manifestation of what they believe.  It is emotionally wrenching to find out your god is a false god.  Some will never let go.

No, I don’t think this election is just about being tired of George Bush or corrupt politicians of which the Republicans have had the majority of lately. Ted Stevens come to mind?  His arrogance is symptomatic of the Republican’s problems.  But that is business as usual in the world of politics.  Power corrupts and absolute power corrupts absolutely. What this election is about is turning a page and moving away from conservative ideology that has held us back from taking any real steps toward changing the direction of this country.

But don’t be afraid.  Liberalism, as the Republicans define it, which is taking your money through taxes and then wasting it is not what is about to happen.  Note the Republicans didn’t bother to take your money, they just wasted it while running up your credit card so someone else would have to take it from your children later to pay the bill.  The new liberalism, which I call progressivism, will be one that sees government as part of the solution, and an effective and efficient partner in our way forward.  It will be one that respects market place solutions, but that also tries new things and is not afraid to do what works, regardless of ideology.  It will be a government that works for all the people, not just the rich with the hope that there will trickle down.  It will be a government that believes if we can empower and enrich our working classes, there will be trickle up.  So in the words of that 90’s commercial, “Try it Mikey, you’ll like it.”  Note to Democrats:  You will have two years to make some progress in the monumental mess the Republicans have left us.  Be thoughtful and don’t screw this chance up.