There were four posts yesterday. The first was “The Three Stooges Theory of Fiscal Policy:”
There’s a scene in one of the Three Stooges movies — if any readers know which one, please let me know — in which we see Curly banging his head repeatedly against a wall. Moe asks why he’s doing that, and Curly says, “Because it feels so good when I stop.”
Big joke, right? Except that this is now the reigning theory of fiscal policy.
As Antonio Fatas points out, austerians are now claiming vindication because some of the countries that imposed austerity are — after years of economic contraction — finally starting to show a bit of growth. This is, as he says, happening because sooner or later economies do tend to grow, unless bad policy not only continues but gets steadily worse; with austerity still severe but arguably not getting much more severe, some growth isn’t a big surprise. And these countries are still far below where they would have been with less austerity.
But hey, it feels good, at least relatively, when the countries stop banging their heads against the wall. Austerity rules!
So here’s where we are: wishing that policy officials in Europe would rise to the same level of analytical rigor and intellectual clarity exhibited by Moe, Larry, and Curly.
The second post yesterday was “What I Said:”
I’m in a meeting of the
Bavarian IlluminatiGroup of 30; very interesting discussion, all off the record. But I can’t resist mentioning that one participant, arguing that we should end easy-money policies despite the continuing depressed state of the economy, warned of potential costs and declared that these costs have been stressed by “very serious people.” The participant clearly did not have capital letters on the words, even implicitly. But I did have a hard time not laughing.
Yesterday’s third post was “Pathetic Centrists:”
So progressive Democrats have seized on an op-ed by the group Third Way — an op-ed attacking Elizabeth Warren and Bill de Blasio for their terrible, horrible economic populism — as a way to start reclaiming the party from the “centrists”. And it’s working: the centrists are very much on the run.
Why? Part of the answer is that the Democratic party has become more progressive. But I would argue that the centrists are also suffering from their own intellectual bankruptcy.
I mean, going after Warren and de Blasio for not being willing to cut Social Security and their “staunch refusal to address the coming Medicare crisis” ??? Even aside from the question of exactly what the mayor of New York has to do with Medicare, this sounds as if they have been living in a cave for years, maybe reading an occasional screed from the Pete Peterson complex.
On Social Security, they’re still in the camp insisting that because the system might possibly have to pay lower benefits in the future, we must move now to cut future benefits. Oh, kay.
But anyway, they declare that Medicare is the bigger issue. So what’s this about “staunch refusal” to address Medicare? The Affordable Care Act contains lots of measures to limit Medicare costs and health care more generally — it’s Republicans, not progressive Democrats, who have been screaming against cost-saving measures (death panels!). And health cost growth has slowed dramatically, feeding into much better Medicare projections. Here’s how the CBO projections have changed since Obama took office:
So what does Third Way think it would mean to “address the Medicare crisis”? They don’t say. But my strong guess is that they mean raising the Medicare age; living in their cave, they probably haven’t gotten the memo (literally) from CBO concluding that raising that age would hardly save any money.
It’s just so tired and tiring. If being a “centrist” means fact-free denunciations of progressives for not being willing to cut entitlements, who needs these guys?
Nobody, that’s who. Yesterday’s last post was “Friday Night Music: Lucius on KEXP:”
I’d recommend their shows this weekend at the Bowery Ballroom, but both shows are sold out. I will, however, report.