Monday, February 04, 2013

GOP Intrasigence: A Million Jobs at Stake

Once again the country stands poised to see economic havoc wrought on many families and businesses due to GOP intransigence on the issue of spending cuts and tax increases.  Sadly, the Congressional GOP seems to prefer a renewed recession over any policy change that would upset the insane extremists and economic saboteurs of the GOP base. Extremists who all too often wrap themselves in the mantle of "godly Christians" even as they push for policies that would slash spending that aids the poor, the homeless and the working poor.  The big question thus becomes one of it and when the rest of the public will bestir themselves to promise sufficient electoral pain against the GOP if the effort to destroy the economy yet again doesn't cease. An editorial on the New York Times looks at the disturbing state of affairs.  Here are excerpts:

With enormous struggle, the sluggish economy managed to create 2.2 million jobs last year. But beginning at the end of this month, at least half that amount — more than a million jobs — will start to disappear because of a mindless government austerity program that no one in Washington seems able to stop. 

From the armed forces to the Federal Bureau of Investigation, every program except for most safety-net benefits is about to be cut by an arbitrary process known as the sequester, instigated by the 2011 Republican rampage against government. Over the next seven months alone, the cuts will reduce defense spending by $55 billion and nondefense discretionary spending by $27 billion.
The Bipartisan Policy Center, a respected independent group, said at least a million jobs will be lost this year and next because of the slowdown caused by withdrawing so much money from the economy. The Congressional Budget Office says up to 1.4 million jobs are at stake. 

This isn’t fortune telling; the effect of the coming sequester was already evident in last week’s announcement that the economy actually contracted during the final quarter of 2012. Much of the decline was directly due to the 22 percent reduction in spending by the Pentagon and military contractors in anticipation of the sequester’s effects. 

With the economy teetering on a knife edge, it is clear that this is the worst moment to initiate an indiscriminate budget cut. Government spending at this time can spell the difference between growth and shrinkage. But Republicans are willfully blind to this reality. Senator John Cornyn of Texas, the second-ranking Republican, called it a “Keynesian pipe dream” last week, saying that only spending cuts will help the economy. 

Congressional Republicans seem perfectly serene about allowing the sequester to take effect in a few weeks, so eager to prove they are budget cutters that they are willing to ignore the coming economic storm. “I think sequester’s going to happen,” said Senator Tom Coburn, Republican of Oklahoma. “I think people want it to happen.”

Congress should be thinking about ways to accelerate the economy, instead of remaining preoccupied with a short-term deficit. Nonetheless, the coming job losses could be sharply reduced if half or more of the spending cuts were replaced by revenue increases, as President Obama and Congressional Democrats have demanded. That would lower the amount of spending pulled out of the economy to bring down the deficit, replacing the cuts with taxes from the rich or companies with high cash reserves that are less likely to spend it. 

The money could be raised by eliminating tax loopholes for energy companies, hedge fund managers and other high-end recipients of federal largess, but Republicans won’t even consider the idea. “The tax issue is finished, over, completed,” Mitch McConnell, the Senate Republican leader, said recently.

In other words, bring on the unemployment. The first jobs to go will be in the defense sector, but the losses will soon spread as contracts to states and cities are cut, education and police grants are cut, and payments to Medicare providers are cut. Even the aid just approved for victims of Hurricane Sandy will fall under the sequester’s ax. Americans are about to find out what happens when an entire political party demands deficit reduction at all costs, because those costs will be enormous. 

One can only hope that those about to lose their jobs understand that it is Republicans who bear responsibility and that these victims of GOP insanity will hand out retribution against the GOP beginning here in Virginia in November.

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