I have a big, strapping cat who’s infamous for darting under a couch
and cowering when a dog, even the tiniest, enters a room. Well, a
yipping toy poodle has entered the Senate from the state of
Never a bold bunch, the Democrats have gone into full-on retreat,
spooked by the loss of Teddy Kennedy’s Senate seat. While the economy
continues to unravel, Obama responds by declaring a freeze on “non-discretionary”—i.e., non-military—spending. That’s not a bold agenda for change; that’s panic.
People prone to being scared by deficit spending should keep in mind
the concept of false economies. In the short term, it would make
financial sense to spurn admission to Harvard and instead pursue a
degree at your local community college. Long-term, it would be absurd.
Like anything else, debt can be abused (think miliary adventures in
Central Asia, or housing starts in deepest suburban Orlando). But it
can also be used wisely.
While Obama caves in to the GOP, somewhere, John Maynard Keynes is
having a stiff drink—and Herbert Hoover is stifling a chortle.
What the economy needs now is jobs, not fiscal austerity. And
government spending, financed at low rates by Chinese investors, can
provide those jobs. And it can do so in a way that jumpstarts the real,
productive economy—as opposed to the house of cards Wall Street keeps
cobbling together with its ever-stacked deck. Moreover, the productive
economy we stimulate can be green and sustainable—and robust enough to
repay investment many times over.
Here’s an example. In analyzing outcomes of the 2009 stimulus package, Smart Growth America found
that “In the 10 months since the American Recovery and Reinvestment Act
(ARRA) was signed, investing in public transportation produced twice as
many jobs per dollar as investing in roads.”
To wit, a billion dollars dumped into maintaining our highway
system, which enshrines the oil-guzzling car as our chief mode of
getting around, generated 8,781 job-months. That same billion dollars
used to build out mass transit created 16,419 job-months.