While the 99 percent lament what they surely see as the next lost decade, a generation of youth deprived of entry-level jobs, the 1 percent scream over raising taxes. Corporations and their lobbyists scream about excessive regulation and uncertainty while sitting on record levels of cash. No large business needs to borrow. Having what they need they are holding on for signs of improvement, signs which may never come. And greed as measured by chief executive salaries abounds. The executive branch argues with Congress not only over cutting spending to ease the deficit, a move sure to increase unemployment, for ultimately all government spending ends up in someone’s pocket, mostly as wages, but also over raising taxes to increase spending, for that does create jobs, at least for a while.
Ronald Reagan’s chief campaign economics advisor and initial chairman of his advisory council made his mark in the field by doing cost-benefit analysis for the Pentagon. He found that the Convair/General Dynamics new Air Force B-57, a supersonic bomber capable of penetrating Russian air space below radar at near Mach 2 speed, was not cost effective. Some were built, but wholesale production never materialized and West Fort Worth and Carswell Air Force Base practically disintegrated. Both my father and my oldest brother had to find new work. I know firsthand that government spending, even wise spending, or the lack thereof, does have an impact. The question is: “Do some sorts of government spending make more sense than do others?” My economics professor, Murray Weidenbaum thought so.
As a nation, we are either going to come together on some sort of plan, or we are not. And regardless of whether or not we do, we are either going to see a revived economy or we are not. Only time will tell. But let’s stop kidding ourselves. We are all in it together, the U.S., China, India, Germany, France, England, Russia, etc., some not positioned as perilously as others. But all must sacrifice, otherwise in these hard times all will surely lose.