Reich: The Economic Challenge Ahead: More Jobs and Growth, Not Deficit Reduction

[pampango]

Can we just keep things in perspective? On Tuesday, the President asked Republicans to join him in finding more spending cuts and revenues before the next fiscal cliff whacks the economy at the end of the month.

Yet that same day, the Congressional Budget Office projected that the federal budget deficit will drop to 5.3 percent of the nation’s total output by the end of this year. This is roughly half what the deficit was relative to the size of the economy in 2009. It’s about the same share of the economy as it was when Bill Clinton became president in 1992. The deficit wasn’t a problem then, and it’s not an immediate problem now.

Right now the central challenge is to reignite the economy — getting jobs back, improving wages, and restoring growth.

Deficit reduction moves us in the opposite direction. That’s because most consumers (whose spending is 70 percent of economic activity) are still losing ground, and businesses won’t expand and hire without more consumers.

http://robertreich.org/post/42429208497

[bluestateguy]

1. Jobs and growth actually does reduce the deficit

More jobs, more taxpayers, more money coming into the treasury, fewer people dependent on government programs.

So many politicians and sniveling reporters seem to be unable to grasp that.

[Ed Suspicious]

2. That is the most infuriating thing about the austerity junkies. They refuse to acknowlege this

reality. The only thing I am left to take away from it is they are either ideologically opposed to government therefore they use economic downturn to eliminate spending via reduce funding to government programs/social supports, or they see no jobs on the horizon and their neo-liberal policies have finally come home to roost and we are simply screwed and will require a standard of living adjustment in a terribly shitty direction. Either way they are insufferable and I hate them.