Sure, we urgently need to repeal the sequester. (You can tell your Representative that here.) But it’s even more important to repeal the insane thinking that led to the sequester.
That means repealing the deficit babble that still dominates Washington (and provided the theme for the President’s weekly Saturday address). It means repealing a conservative Republicanism which is based, not on economic philosophy, but on an atavistic hatred for government in any form.
Most of all, it means repealing the politics of deprivation and replacing them with the politics of growth. We’ve learned that contractionary policy based on government cuts is … well, contractionary. And that expansion policy is needed if we want the economy to expand.
The argument shouldn’t be about where we should be cutting, but about where we should be spending more money.
Have You Hugged a Keynesian Today?
Pity the poor Keynesian. This benighted economist has been vilified, ridiculed, and marginalized for decades. What was the Keynesian’s crime? To imagine that the proven economic principles which fueled our post-Depression and postwar growth were still proven economic principles.
The assault on Keynesian thinking went hand in hand with other mythologies of the New Economy: You don’t understand our new theories, the Keynesians and neo-Keynesians were told. You’re mired in the thinking of the past. You don’t understand the information economy. You can’t grasp financial innovation.
And your old models of government action in recessionary times are obsolete because they’re not creative enough. (That’s an especially objectionable word in this context. This is economics, not a university extension course on “Self Expression With Clay.”) (more…)