9.2% unemployment is a scary percentage so far out of the recession. Adding this chart makes the American economic moment pretty frightening.
“As catastrophic as it would be to fail to raise our debt ceiling, it’s even more irresponsible to not take this opportunity to own up to our unsustainable spending path,” Sen. Mark Udall (Colo.), another Democrat challenging the White House, said in a statement his office released this week. “If we don’t take action to reduce our deficit spending, Congress will be facing this same debt ceiling vote in the near term – still with no end to our deficits in sight.” WaPo
I’m trying to find something worse than catastrophic. Apocryphal? Yes, apocryphal is the only remaining degree of awfulness. Because rebuilding our 1960s infrastructure and keeping pace in infrastructure spending rates with Europe and China would simply bring about the Four Horsemen…
There are powerful Democrats, traditionally the party of Keynes (though I think that political alliance died in the 80s) saying that spending has to go down, when it is the only part of GDP growth anyone has the power to increase, is truly a failure in political economy. Republicans, of course, for ideological and partisan reasons, are content to keep America at a low burn.
Insanely, even Democrats are talking about withholding approval to raise the debt limit. There is very little keeping the economy with forward momentum. Investments and exports dropped like stones last quarter. It also looks like Wall St hasn’t recovered; it’s not investing money at stable positive rates. The stimulus is now entirely over, so government purchasing rates will likely continue to decrease.
And the kicker, how well has depending on consumer spending for GDP growth helped the American economy in the last 3 years?
Where’s the GDP growth going to come from that will get that unemployment rate down?
We have historically low levels of interest and inflation remains trending at historic lows. Even if food and gas prices are trending higher, that’s exactly the inflation the unemployed will not be able to handle without jobs. Those with jobs can handle it if red peppers cost a little more. There are 0 reasons the government should not be spending lots of money in American projects right now. And no, defense procurement does not count.