The Washington Post‘s Fareed Zakaria (10/26/17) decries America’s “narrow and cramped ideology.”
In his Washington Post column (10/26/17), Fareed Zakaria pushes the pet myth of the arithmetic-challenged elite (yes, that is probably redundant) that the federal debt is limiting spending for many important ends:
[The United States] is politically paralyzed, unable to make major decisions. Amidst a ballooning debt, its investments in education, infrastructure, and science and technology are seriously lacking.
Arithmetic fans would evaluate this assertion by looking for evidence that the debt is causing problems such as high interest rates and inflation, and creating a large debt-service burden.
The opposite is the case, with long-term interest rates still under 2.5 percent, compared to more than 5.0 percent in the surplus years of the late 1990s. Inflation remains under the Fed’s 2.0 percent target, and has actually been trending downward this year. And debt service is less than 1.0 percent of GDP (net of interest rebated by the Fed), compared to over 3.0 percent in the 1990s.
In short, there is no evidence that debt is limiting our ability to spend more in these and other areas. There is a strong case that fears over the debt, raised by folks like Zakaria, are limiting our ability to invest for the future.
A version of this post originally appeared on CEPR’s blog Beat the Press (10/27/17).
Messages can be sent to the Washington Post at letters@washpost.com, or via Twitter @washingtonpost. Please remember that respectful communication is the most effective.
Anything to ignore the fact that we the people have lost control of the economic aspects of our lives to the extent that, as FDR warned us was possible, we now live under the tyranny of “economic royalists” as he so aptly put it.
Obama was supposed to be our FDR – he claimed to be for hope and change – but he lied. And because of that failure, we’re now saddled with Trump. The idea of “Hope & Change” has not become an inspiring call, but a national joke along the lines of “Read my lips…”.
I doubt we’re going to emerge from this any time soon, considering the huge numbers of people obsessing over the effects of a few hundred thousands in internet ads on our multi-billion dollar elections. Meanwhile the anti-democratic GOP juggernaut of gerrymandering and voter roll culling presses on, disenfranchising millions, while each GOP victory brings more tax cuts and corrupt contracts pouring more cash into the pockets of the GOP donors.
But ah, America is already great, isn’t it?
Obama did not lie, for he promised your educated upper-half of society that you would continue to own all the land, wealth, political power and healthcare. For my uneducated lower-half, did Obama give us anything that would qualify as universal healthcare or even half of what is needed for a living wage?
I view our national spending priorities as not really controlled by a TRUE fear of debt — that’s nothing more than an economic boogy-man that the right-wingers summon-up at their rhetorical convenience — but as being controlled by political ideology, namely the right-wing/libertarian views that became popular in the late 1970’s. After all, the ‘conservatives’ have NO problem pushing up the debt ceiling for ‘defense’ (military) spending, as most recently evidenced by the ~$80 B budget increase for one fiscal year (during peace-time, no less), on top of the world’s largest (by many times) military budget, or rescuing the financial community every 10 or 20 yrs when they run amuck.
As government is nothing more then the organized morality of society,
why fanaticize that changing government will eliminate the root cause?
The “debt” used to be a number showing the relationship between the gold reserve and all currency in the private sector. When the gold reserve was removed from the equation only the existing currency was left, which is what the category now represents. If we were to pay off this number via taxation and spending cuts we would have to operate the economy without currency or the Treasury instruments that represent it. And we wonder why the economy gets worse as we go farther down the austerity rabbit hole? If our deficit spending doesn’t compensate for currency drained by wealth accumulation and trade deficits the available currency/lifeblood in the economy dwindles away and we are forced into leveraging our personal debt with banksters. They love our ignorance. They simply manipulate the business cycle to move public money into their hands with bubbles and busts. It is estimated by several well credentialed economists that the bailout from the ’08 crash cost as much as $29 Billion total.
That money is gone, never to be recovered, so attempting to get it back via taxation will only cause them to further corrupt our government and keep us from recreating the economy that we should have. What is needed is a full scale New Deal to bring employment to 100% and make our economy work for us again. This means that the government must become the employer of last resort as it was when we last allowed the oligarchs to have their way with our monetary/fiscal policy prior to the ’29 crash. a federal jobs program, paying a living wage and benefits to anyone who wishes to perform minimal tasks or retrain for the future, would replace the minimum wage and most of our safety net programs. It would bring power back to workers and force employers to step up their game to attract a workforce. We once accomplished big things with far less flexibility than we now have for spending with a fiat currency. We can do it again, but we must overcome the false rhetoric that we are broke or can’t afford anything that is for sale in dollars. To do that we need a new government with a mandate from the people to work for the public good and their best interests.
“we need a new government with a mandate from the people”
As my impoverished lower-half of society, my slow thinking laboring-class, as we have not your intelligence to grasp your logic, we have no faith in your ability to understand a super-complex system of economics that only the super-intelligent rich have the intelligence to understand, especially when the rich do everything behind closed doors. Please explain?
Seems a lot of people here need a crash course in MMT (http://neweconomicperspectives.org/modern-monetary-theory-primer.html). The national ‘debt’ isn’t money owed to outside parties. It’s the money that lies on the liability side of the federal Reserve ledger. It’s the money in our bank accounts and wallets. It will all, sooner or later, be returned to the balance sheet via taxation. The terminologically and things like the ‘deb ceiling’ are absurd holdovers from before the government went full fiat in 1971. Money is created out of thin air when Congress authorizes new spending. Any, any, fear mongering about federal ‘debt’ is either utter ignorance or willful lying, period. Our leaders at least implicitly understand how the system really functions when it comes to military spending; there was no hand-wringing about where we would ‘get the money’ when it came to throwing $80 billion more at our military.
As your educated upper-half of society already owns all the land, wealth and political power in our Empire, your enlightenment is only going to make then more efficient Empire builders.
A better way, let us organize my laboring-class lower-half, as only they have something to gain and nothing to loose.
Remember folks if you find CNN unwatchable Fareed Zakaria and Christiane Amanpour are the serious ones you can rely on. Except for Fareed just remember all this debt fake crisis nonsense doesn’t matter because when Trump bombs Syria from looking at fake videos from White Helmets and CNN he finally has become “presidential” as well as blowing fake kisses to a grieving widow of a soldier he sent to do the bidding of imperialist wars. CNN and Washington Post the more you watch and read the less you know