Interesting observations from Bill Black at NEP today.
Professor Black brings attention to a recent interview of GOP candidate Romney by the WaPo where Romney exhibits what we often see in those outside of the MMT paradigm: The inability to discern logical contradiction.
Romney at one point states in response to a question about the schedule of "budget balancing" policies under a hypothetical Romney administration:
"Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression. So I’m not going to do that, of course.”OK, this makes sense (so far). Reducing discretionary "G" by $1T would probably result in a 5%+ hit to US GDP. But then Prof. Black points out:
Later in the interview, Romney claims that federal budgetary deficits are “immoral.” But he has just explained that using austerity for the purported purpose of ending a deficit would cause a recession or depression. A recession or depression would make the deficit far larger. That means that Romney should be denouncing austerity as “immoral” (as well as suicidal) because it will not simply increase the deficit (which he claims to find “immoral” because of its impact on children) but also dramatically increase unemployment, poverty, child poverty and hunger, and harm their education by causing more teachers to lose their jobs and more school programs to be cut.Prof Black points out here how Romney is exhibiting the classic inability of those outside the MMT paradigm to discern the logical contradiction between their position on the one hand, to support higher government spending to support US GDP and the associated public purpose; and on the other hand, view fiscal deficits as "immoral" or something.
This behavioral phenomenon has become rather commonplace in those outside of the MMT paradigm. We see it all the time. It is behavioral exhibition of some sort of confused miasma of illogic and immorality, or in another way, a lack of mathematics and morality. We continue to try to examine this phenomenon here at MNE.
Prof Black then opines:
I predict that he (Romney) will not act to protect our children or our economy from the suicidal and “immoral” austerity his Republican allies are trying to coerce the Democrats to inflict on our economy and our children.Is Prof Black trying to assert that Democratic economic policy makers, who have established the Simpson-Bowles Deficit commission, foregone any prosecution of financial frauds, report to a President that claims the US government is "out of money", etc... only do this out of some sort of political "coercion" applied to them by Republicans?
Republicans who fail to exhibit basic logical cognition skills that would enable them to discern contradiction? As if Democrats do not lack these same cognitive skills but instead only "choose" to pursue fiscal "conservative" policies due to so-called "political coercion"?
THAT WOULD BE ABSURD.
Professor Black, have you heard Gene Sperling or Tim Geithner talk lately?
You can't blame moron Republicans for the moron policies of Democrats; both parties do quite nicely on their own.