Monday, July 16, 2012

Marshall Auerback — So-Called Fiscal Cliff Is Baloney; Our Economy Can Recover if Obama Focuses on What We Really Need: Jobs!

Talk about deficits and tax cuts distracts us from the great New Deal lesson: An economy recovers when people go back to work.
Read it at AlterNet
So-Called Fiscal Cliff Is Baloney; Our Economy Can Recover if Obama Focuses on What We Really Need: Jobs!
by Marshall Auerback
(h/t John Zelnicker in the comments)

7 comments:

Clonal said...

Also Michael Stevens - A Debt Jubilee via Eminent Domain?

GLH said...

We have been waiting for Obumer to do something for us for three and one half years now. When are people going to understand that the only difference O and Rhomney is - forget it, there is no difference? Progressives, or anyone who is not a Republican, should have pushed for a real progressive candidate against O. Which ever wins we will end up with a neoliberal as President. By the way, you should read What "Do You Want For America" by Thornton Parker at New Economics Perspectives. It is absolutely the best explanation of the national debt I have read. In fact, it should be called "base money" instead of the national debt.

John Zelnicker said...

GLH -- Agreed. That is really quite a good idea. Changing the terminology and framing is, I think, absolutely necessary now. We have got to get away from the idea that this is debt since almost everyone is going to relate that to their own mortgage or credit card debt. And, of course, framing the debate is where the conservatives have been so much more effective than progressives. They are consistent and always on-message with their drumbeat of "fiscal sustainability".

Major_Freedom said...

An economy recovers when people go back to work.

People go back to work when the economy recovers.

paul meli said...

"People go back to work when the economy recovers."

It seems you are having trouble finding the beginning of the circle.

There is no economy if people aren't working. So I would say people working CAUSES an economy to exist.

Can there be an economy if people aren't working? I say no.

Conversely, can people be working if there is no economy? I say yes. I do all kinds of work I don't get paid for.

John Zelnicker said...

Once again, Major, you have the causality backwards.

I have a hard time understanding how so many people think supply drives demand, instead of demand driving supply as it actually does. The economy can't recover without increasing demand and you won't do that until you employ people.

When I was selling life insurance many years ago, we had a saying: "Nothing happens until a sale is made." And a sale can't be made until someone "demands" a product or service. My job as a salesman was to help create and focus that "demand" so the prospect would buy some life insurance from me. Supply was essentially unlimited. There was no way to increase sales without increasing the demand.

I think, in a way, this is where so many people fail in their understanding. They listen to the talking heads, pundits and supposed experts without reflecting on whether or not what they are hearing is consistent with their personal experience. (I know most people do this comparison inappropriately when thinking about budgets and money, but I'm referring to the real economy, not the monetary part.)

We see businesses close all the time because, well, no one shopped there anymore. Now, translating that to the larger economy, it seems obvious that demand must come first. Why is this so hard?

Matt Franko said...

great points John