Obama has said that he will propose a spending freeze of 447 billion dollars over the next 3 years in his State of the Union. This only includes domestic programs and leaves out the biggest expenditure in the budget, the Department of Defense.
This, in a time of deep recession is not only reckless but also ill advised. Not only will it not reduce the budget deficit but it will aggravate the recession.
Obama’s team should read some history. When Frank D. Roosevelt succumbed to the pressure of reducing the deficit in the thirties he then admitted years later that he made a mistake by extending the depression.
I understand those who say that we need to attack deficits, but by the same token that raising taxes is not a good idea during recessions, trying to reduce deficits during deep recessions, is reckless.
To make matters worse when they talk about cutting or eliminating programs the same sectors of the population, the needy, are the first ones to get hit.
Many people say that Hitler should have read history before invading Russia (the Soviet Union at the time), as he would avoided some common mistakes that Napoleon had made 100 years before during his unsuccessful invasion of Russia.
Here we are facing the same problem.
If he wants to reduce the high unemployment that is at the core of the discussion right now, deficit reduction is not going to take care of it.
It is unfortunate that the Obama administration is more concerned with damage control because of the loose in Massachusetts than what it is about setting policies that will revive the economy. The president seems to have lost his footing, and by doing that he has also lost the energy that he had during the campaign, and is loosing his base.
If he thinks that he will please any conservatives with this measure he is mistaken. Some members of the house have started mocking the cut as “going on a diet after winning a pie-eating contest”. The country is too polarized, and the opposition is only focused on obstructing any proposal that he brings to Capitol Hill, so that they have a platform to run next November.
There are other measures to reduce unemployment, but due to lack of activity and investment of the private sector it will take a substantial amount of time to get out of the hole that we are in.
Tuesday, January 26, 2010
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment