Three Strategies for Dealing with the Deficit
At what point, then, is the approach of danger to be expected? I answer, If it ever reach us it must spring up amongst us; it cannot come from abroad. If destruction be our lot we must ourselves be its author and finisher. As a nation of freemen we must live through all time, or die by suicide.
WE HAVE TWO problems before us:
- The Deficit
The growing debt in our nation's budget.
- The Recession
The decline of jobs, pay, and business for the poor and middle class.
These two problems cannot be separated.
- On one hand, the current size of the deficit is a result, in large part, of the stimulus spending which was necessary to keep the recession from becoming another great depression.
- On the other hand, many of the solutions which have been proposed to deal with the deficit are by their nature bad for the economy, and would therefore make the recession worse.
This leaves the American people with two choices, but not the two you might expect:
- We can continue to fight a losing battle.
We can proceed with the same balancing act we have been struggling with for the past thirty years, teetering between a growing deficit on the one hand and impending recession on the other, or
- We can step back, take a deep breath, and question the assumptions that got us into this mess.
I began this series by presenting a balanced budget, with a surplus, by simply making some clear choices about which current proposals to support or reject—by way of showing at the outset that it could be done.
In the previous three posts, I've looked at three of the assumptions which have got us into this mess:
- The idea that we can remain a free people while giving all the money and power in the country to super-wealthy individuals and corporations,
- The idea that our democratic republic is an invading dictator rather than the tool by which we promote our own well-being,
- The idea that the road to prosperity is to continually line the pockets of the wealthy at the expense of everyone else.
All three ideas have been shouted at us through the conservative propaganda machine, funded (surprise!) by the very wealthy, and none of them are true.
We have repeatedly cut taxes for big wealth while providing corporate welfare at the same time—both cutting their expenses and subsidizing their businesses.
As a result we have been forced to cut government programs which benefited every American, and we are saddled with a growing deficit.
As Albert Einstein probably never said:
The definition of insanity is doing the same thing over and over again and expecting different results.
So here are some specific strategies, aimed at solving both problems at the same time.
If we want a free country, if we want a democratic government, if we want a prosperous economy, we should do three things:
Take a bottom-up approach to investing in the economy.
Stop wasting our money on super-wealthy individuals and corporations—either through tax breaks or subsidies.
- If they are that successful they don't need further help while the rest of us bite the bullet.
- The money can be better used elsewhere.
- The very existence of such concentrated wealth in contrast to the average citizen poses a threat to our freedom and to a democratic republic.
Put our money, as a country, where it will do the most good for everyone:
- in infrastructure,
- in education,
- in research,
- in tax breaks for the poor and middle class,
- in government services for everyone,
- in measures to help families and small businesses.
Stop wasting resources on the infrastructure of an American empire.
- We already out spend all of our serious military rivals combined.
- An oversized military is a constant temptation to dispose of democracy in favor of empire.
- Our tendency to invade other countries which have not attacked us is not only wrong, but it gets us into quagmires which weaken our nation.
- Every unnecessary war we wage ends up increasing the deficit.
Keep the money in our economic system doing what it is designed to do—providing a medium of exchange for all of us, lubricating production from the bottom up.
Make sure that there is a constant circulation of cash,
- from where it tends to accumulate, at the top,
- down to the poor and the middle class,
- where it can bubble up through the economy,
- creating jobs,
- nurturing families,
- supporting creativity and hard work, and
- creating profits for the wealthy.
It's as simple as that.
Notice that nothing above interferes with a truly free market—a level playing field for enterprise and trade—or with our nation's ability to defend itself, or with protecting ourselves from tyranny.
Quite the opposite—each of these strategies would make the market freer, level the playing field, and put us in a better position to defend ourselves from outside threats and from the tyranny of the rich and powerful within.
We're not talking about Draconian cuts here, just about the direction our cuts and our taxation should take when faced with a double crisis like the budget deficit and the recession.
We have been cutting services to the poorest among us and cutting taxes for the wealthiest for the last thirty years, and we have seen where that has led.
It's time to try something new.
In the next installment:
Some Specific Examples...