I think Obama screwed up on the tax deal and that his budget proposal sucks, but even Kthug says this:
So anyone who is really serious about the budget should be focusing mainly on health care.
[…..]What would real action on health look like? Well, it might include things like giving an independent commission the power to ensure that Medicare only pays for procedures with real medical value; rewarding health care providers for delivering quality care rather than simply paying a fixed sum for every procedure; limiting the tax deductibility of private insurance plans; and so on.
And what do these things have in common? They’re all in last year’s health reform bill.
That’s why I say that Mr. Obama gets too little credit. He has done more to rein in long-run deficits than any previous president. And if his opponents were serious about those deficits, they’d be backing his actions and calling for more; instead, they’ve been screaming about death panels.
And don’t forget that the fiscal austerity insanity is even bigger in Europe than it is here. This isn’t the Iraq War or the “debate” over evolution, where the United States is a right-wing outlier, this is an example of the whole fucking western world going mad. If Obama’s not fighting quite as hard as I would like, at least he knows a hawk from a handsaw.
Omnes Omnibus
Only when the wind is southerly.
Violet
This is so true. I fear all the austerity measures are not going to end well for everyone.
JC
I think El Cid’s comment in the ‘greeted as liberators’ post, most attests to this, both for Europe and the U.S.
Point being – the elites cannot go to 3rd world countries much anymore to suck out value. They have their own bloodsuckers now, and can operate without ‘western elites’ taking their slice off the top.
So – in order to pay for the massive f*ck-up of financial gambling of 2008 – well, THEY are not going to pay for it, are they?
So all of ‘the little people’ have to sacrifice – for their betters, of course.
Dennis SGMM
@Violet:
I disagree: it will preserve the value of the fortunes of those who put us in this spot in the first place. Now that’s worth the suffering of the rest of us.
Dave C
So the take-home message here is…”We’re All Fucked,” right?
Jonny Scrum-half
I’m wondering why Europe is in such bad shape fiscally, if it’s not spending its money on the 2 items that (in my understanding) are causing problems here — (1) the military, and (2) health care (which costs half as much in Europe as here).
cyntax
Yeah but how can we trust someone who says:
That’s just un-American. Now let’s get out there and push our defense spending to 8x our nearest potential rival. USA! USA! USA!
JPL
As soon as Cameron put in place his austerity plan in England the GNP..fell. who woulda thought…
daveNYC
@Dave C: That’s what the last week has been saying to me. Best domestic news has been the protests in Madison, and even there I get to read about all the VSPs tut-tutting about it.
mr. whipple
Can’t we blame Obama for something? C’mon, I wants me some page views. /firebagger
MikeJ
@Jonny Scrum-half: For the most troubled nations in Europe, the problem is that nobody wanted to buy their bonds any more, for fear they wouldn’t get paid back.
In the US we’ve gone back and forth between paying as close to zero interest as is possible and actually paying negative interest. People want to pay us to loan us money.
If you cannot borrow more money, you have choice but to go to austerity measures. That’s why the GOP wants to not raise the debt ceiling. They want to force the US into bankruptcy.
fasteddie9318
@mr. whipple: I’m fucking blaming him for the fucking Super Bowl until somebody explains why I shouldn’t.
Loneoak
@JC:
We’re fighting them here so we don’t have to fight them over there.
Redshift
@Jonny Scrum-half: Read Krugman. Europe was a full participant in the economic crash (since it was actually caused by derivatives and financial fraud, not poor people getting mortgages), which is a big cause. And beyond that, some countries in Europe are doing especially badly because they have a common currency but not much labor mobility. Plus some countries did really stupid things, like Ireland guaranteeing essentially all of their banks’ assets.
From what I understand, the situation in the UK is that other than the economic crash, they’re actually not doing badly fiscally. They have pretty much the same situation we have here — conservatives using circumstances to justify “austerity” they’d like to do anyway, only their conservatives are less insane.
Stooleo
OT. If you want to support the Wisconsin Dems, Atrios has an Act Blue page.
daveNYC
@Jonny Scrum-half: Basically it’s a problem of being on a unified currency, which prevents weaker countries from having a more favorable exchange rate, while at the same time having a central bank that is setting policy based on what the strongest economy (Germany) wants.
Villago Delenda Est
The problem is the banksters.
They must be removed from the system, one way or another, and their three card monty games with new, more exciting names, must be banned.
General Stuck
Kthug chugs the Obot kool aid. BLASPhEMY!!
Mount yer Unicorn and ride motherfuckers.
Sentient Puddle
@Villago Delenda Est: I’ll join you in hating banksters, but what the fuck do they have to do with anything here?
mr. whipple
I am filled with despair.
Sockpuppet
@Jonny Scrum-half:
Short answer: too many old people consuming too many end-of-life resources.
Longer answer: white people, having achieved great wealth, live longer and no longer have so many children. In a world dominated by white supremacy, where other racial and ethnic groups (that are growing faster) have not historically shared this economic growth, this produces great long run budgetary and fiscal strains.
Villago Delenda Est
@Sentient Puddle:
Um, they created the entire mess in the first place with all their “financial innovations” which resulted in pension funds being hollowed out and shipped off to the Caymans?
Sentient Puddle
@Villago Delenda Est: Same question as before.
You have to try a little harder to actually link this to the topic at hand. Otherwise, you’re making yourself sound like a Republican shouting “Tax cuts for the rich!” as a solution for problem X.
jl
good post, except I would say
“whole fucking western developed world going mad.”
Most emerging economies, including most famously China, have not followed the contentless and nonempirical free market general equilibrium macroeconomic school so slavishly.
That is why we now have a bifurcated world, with more robust recoveries in emerging markets than in the developed western economies.
Two of the Baltic emerging economies, Estonia and Latvia, have followed the austerity madness of the developed world, and they have suffered depression level contractions in GDP and employment.
Edit: I would also have left out the naughty word, because I am not a dirty foul mouthed shrill and uncivil blogger. I apologize to all right minded people for the slip up there.
DougJ®
@jl:
That’s interesting about the Baltic Republics.
Elia
isnt what Germany doing rather sensible considering they don’t have an unemployment problem (any more than they usually do)? Ditto Spain and Ireland because no one will lend them money? Seems to me the UK and America are, in fact, again the ideologues/outliers…
Uncle Clarence Thomas
.
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At least he knows there’s probably no difference between literally taking the food out of the mouths of women, infants, and children, and turning off the elderly population’s heat in winter.
.
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El Cid
The House Republicans voted to defund health care reform implementation funds. Not yet at the stage of passing the Senate.
Elvis Elvisberg
One of these days, I’m gonna pay it back, pay it back…
But yeah, that was a pretty important Krugman post. Our health care costs are unique, of course. That’s where the money is.
‘Course, we also have about the lowest tax intake in the OECD, and had a better-functioning economy with higher tax rates in the 1990s, so if we had a sane polity, we’d be talking about reverting to those rates. Alas.
El Cid
@JC: I’m glad you found the comment helpful, but the main impact of independence in South America from the US and its proxy lenders has been an increase in the quality of life for the poorer and working classes.
In abandoning nation-bleeding neo-liberal policies, yes, the national bourgeoisie increased their capacity to profit from the domestic economy.
But for the first time such large nations were able to implement hugely helpful social reforms.
These are the sorts of social democratic and innovative programs which in the 1960s and 1970s got and/or would have got them US-backed coups and tyrannies.
South America’s a success story for its population, not just for its elites. Not perfectly so, not without continued exploitation and screwing over, but real improvements in the reduction of poverty and extreme poverty, education, health, hunger, housing, and other areas.
Such that Chile’s liberal-left reforms have been so popular and successful that not even the election of a right-wing billionaire as President has prompted any attempts at their dismantling.
The problem for us is that, if we are lucky, we’re just entering the phase in which “austerity” (or “structural adjustment” as applied to Africa) is being forced upon us.
In a couple of decades would we be as successful at reversing those policies?
Tim
I have utmost respect for Paul Krugman, so I’ll accept that what he says here is generally true.
So, for the hundredth time, why do I not hear Obama and his team out in the 24 hour news cycle day after day pounding home the same theme? That he is doing good progessive work on these issues? Why do we only hear it around the edges once and while?
Why do the Dems seem to willfully suck at messaging? Messaging is very important. Why do they appear to blow it off?
It does not compute.
Brachiator
@Sockpuppet:
Apparently, Japan is a nation of white people. Who knew? From a recent profile in The Economist:
Violet
@Dennis SGMM:
That didn’t work out so well for the nobility in the French Revolution. It doesn’t always go as planned for those with the money.
PurpleGirl
@Jonny Scrum-half: They had housing bubbles also (see Ireland) and a number of their banks and countries had invested in ours. And they borrowed for other things, see Greece. They got sucked in to being our banksters partners and/or clients.
What MikeJ (#11) says, is another side of this.
El Cid
@Uncle Clarence Thomas:
Speaking of elite views of aid to the elderly for retirement… Another view from the Time magazine archives, from when Francis Townsend proposed a retirement pension of $200 / month for all those 60 & over, paid for with a 2% national sales tax.
He meant this not only for pension for retirees but as a huge plan to save the economy, by putting millions of consumers out there and jobs for those under 60 to fill in.
Townsend shocked the nation and its elites by getting millions of backers. According to the article from Time over 25,000,000 people signed a petition in its favor. 25,000 clubs organized to push it.
His success in organizing to back his plan (including a huge letter writing campaign to the press) that FDR moved on his administration’s proposals which had developed over studies and hearings for several years. That became the social insurance plan we know as Social Security.
It may not have been a great form of revenue for the program, but I like this particular reaction for its brute honesty. (January 1935)
Fuck you, you lazy piece of shit oldster parasites.
It wasn’t mainly those fears of old lazy scumbags which got Social Security to be social insurance based on worker & employer contributions, but they were there.
Townsend’s continuing pressure got the SS reforms and expansions of 1939, which led to all Americans suffering from elderly pickpockets and ruffians enjoying the post-60 good life.
joe from Lowell
@fasteddie9318: The Republicans would be worse?
They’d have made Pittsburgh lose to…like…Dallas. With Brett Favre.
JC
el Cid,
Yes, I agree on South America. Was more talking about the ‘elite attitude’ and how now american elites have to ‘eat their own’, Intelligent policies ARE being followed in South America, which is benefiting the common person.
US elite “make the common man suffer” policies will be followed, until ‘the people rise up’, and refuse to take it anymore.
We’ve now had three decades of the U.S. population, basically, refusing to rise up – in fact, continuing to enable the elites, to slowly suck more and more out of the working and middle classes, and refusing to invest in improving this country.
How long will that continue before the backlash? How many lost opportunities (21st century electrical grid, shifting to renewable energy, connecting more areas by high speed train), how many more people will suffer unnecessarily (universal health care for all – it’s cheaper AND you get medical coverage!) will it take?
Or will cheap electronics, a thousand and one entertainments, the internet, these type of advances, continue to provide distraction enough, to make ‘Idiocracy’ our ultimate destination?
Observer
I don’t think that’s quite true. The whole Euro austerity thing at the ECB is driven by German and French bankers who basically want their customers in foreign countries to eat their bad bets in a way that doesn’t expose their toxic assets back to the banks. So bad for Europe but good for the specific bottom lines of the banks. I think.
So it’s not madness, just cynical dispassionate zero-sum gaming.
Sockpuppet
@Brachiator:
The white/non-white divide can be extended culturally to include Japan quite easily, rather than just seeing it through a phenotype lens.
In the US, western Europe, and Japan it’s the same exact story. One dominant racial/national/ethnic group achieves high standards of living and wealth through industrialization. They stop producing as many children. This sets off a demographic squeeze. Which in the case of Western Europe and Japan can then only be alleviated through heightened levels of immigration and assimilation by non-dominant ethnic and racial groups.
The US doesn’t have an immigration problem to the extent of the other two, but it’s fiscal problem is also down to racial/ethnic inequalities. If future black and hispanic generations (which are growing faster than whites) were living and earning and producing at comparable rates as whites, the looming fiscal problems would be less problematic.
Brachiator
@Sockpuppet: RE: Apparently, Japan is a nation of white people.
Or it might have made more sense to talk about industrialized nations without the inapplicable reference to “whiteness.”
In the case of Japan, which non-dominant ethnic group might this be?
Sockpuppet
@Brachiator:
Chinese, Koreans, Filipinos, any other southeast Asian population that has fallen under Japanese dominion from time to time. Japan is 97% Japanese. And highly resistant to immigration from neighboring countries, even those with a labor surplus.
You seem to be laboring under the delusion that the Japanese aren’t an intensely nativist people historically. It makes perfect sense to apply the normative label of ‘whiteness’ and ‘white supremacy or privilege’ there to emphasize the universality of the causes behind its economic stagnation compared to the West.
White isn’t just a color. It’s a sociological construct.
joe from Lowell
@Sockpuppet:
Don’t forget the Ainu.
And the Eta.
Brachiator
@Sockpuppet:
Aside from ethnic Koreans who have lived in Japan for centuries, there are no native non-Japanese people to pick up the slack for the aging Japanese population.
Quite the contrary. You seem so intent on belaboring the idea of “whiteness” to indicate privilege in industrialized nations that you strain to try to shoehorn Japan into your model. It won’t work. It isn’t necessary. It isn’t nearly as useful as you think it is. South Korea and even China have working age populations that are beginning to shrink. These two countries also have problems with population policies that unnaturally suppress the number of girls born, which in turn reduces the number of women who can form families and produce future workers. Painting whiteface on Asian nations just doesn’t work to explain their dilemmas.
Some of Japan’s problems are also exacerbated by a culture that devalues adult women and which coddles retirees. From another Economist article on Japan:
And in a nation as xenophobic as Japan, which doesn’t even view the people of Okinawa as being “Japanese,” it’s hard to see what a pro-immigration policy might look like.