FacebookTwitterGoogle+RedditEmail

Paul Ryan’s “New” Austerity Budget

by

America is currently plagued by people making bad personal choices. But, the worst decisions rendered are not those of everyday Americans treading water in order to keep their heads above water, but by politicians like Paul Ryan. Exhibit A: his latest budget.

As Mark Twain noted, while “history does not repeat itself, it does rhyme.” Congressman Ryan’s budget proposals echo the past in that they reprise the policies designed to fight the last ‘war’ (the economic crisis of the 1970s). Not all economic crises are created equally. Some are mostly supply-side (not enough resources, e.g., oil), such as the 1970s. Meanwhile, others are primarily demand-side (insufficient wages to purchase what can be made), such as in the Great Depression of the 1930s and now. Ryan’s budget proposal tenders supply-side solutions (austerity) to deal with a mostly demand-side crisis. It then further doubles-down on the austerity policies introduced in 2011 by Tea Party governors and congressmen. Such prescriptions have been like medieval medicine that bleeds an ailing patient. Then when said patient refuses to fully recover from previous rounds of austerity imposed, the pontiffs of austerity declare the patient’s virtue in question and prescribe a round of flagellation to get ‘his mind right.’

None of this has proved effective as an economic cure, but it relieves the austerians of the need to confront their policy failures, while simultaneously conferring the benefit of raining down ever more subsidies and tax cuts to their patrons (now able to give near unlimited campaign contributions in light of recent Supreme Court decisions).

Ryan’s budget contains many aspects of Reagan’s budgets, but with even more severe cuts to education, health and research, of which the last generates tomorrow’s innovations and economic growth. To be more accurate, Ryan’s budget combines the harshest Greek-style social cuts of recent years (far more draconian than Reagan’s), but combines those cuts with a Reagan-style ‘military Keynesianism’ that dramatically increases military spending. Ryan’s budget would add nearly a trillion of new military spending over the sommersausteritynext decade. One would think we learned our lesson regarding tax cuts for the wealthy and simplistic supply-side nostrums that fueled Wall Street excesses and ultimately the biggest crash of our economy since the Great Depression. But, just as one takes solace that we finally learned from our past errors, like the movie Ground Hog Day, we seemed doomed to awake each morning and try the same failed policies, but only harsher with each incarnation.

Moreover, austerity simply does not work, as amply demonstrated by Greece. In Greece, the result of massive budget cutting proved to be a whopping 25% cut to national income.
Furthermore, Ryan’s budget fails to recognize simple math. Instead, we get Horatio Alger tropes that his budget “empowers recipients to get off the aid rolls and back on the payrolls.” But, with three job seekers existing for every really existing one job, Ryan fails to explain how this musical chairs game on his Titanic results in employment? One answer might be to offer a government as employer of last resort jobs program, but that assumes that his interest is actually in creating jobs and not just cutting taxes for his campaign contributors.

Worse yet is Ryan’s intellectual dishonesty. Ryan asserts his budget cuts are in fact small and don’t represent austerity at all. This slight of hand trick results from arguing the budget is only modestly cut, but this fails to mention that his cuts to health and research are massive. Thus, overall spending cuts are only smaller because of his massive proposed increase to military spending. Moreover, Ryan’s ‘orange-alert’ warnings about Medicare drowning in debt have to be re-thought in light of rapidly declining growth of healthcare costs. Indeed, the past five years have shown the slowest increase in health costs since records were kept.

Jeffrey Sommers is Associate Professor of Political Economy & Public and Senior Fellow, Institute of World Affairs of the University of Wisconsin-Milwaukee and Visiting Faculty at the Stockholm School of Economics in Riga. His new book new book (with Charles Woolfson)The Contradictions of Austerity: The Socio-economic Costs of the Neoliberal Baltic Model  is available from Routledge.

Jeffrey Sommers is Associate Professor of Political Economy & Public and Senior Fellow, Institute of World Affairs of the University of Wisconsin-Milwaukee and Visiting Faculty at the Stockholm School of Economics in Riga. His new book new book (with Charles Woolfson), is The Contradictions of Austerity: The Socio-economic Costs of the Neoliberal Baltic Model

More articles by:

CounterPunch Magazine

minimag-edit

bernie-the-sandernistas-cover-344x550

zen economics

Weekend Edition
March 24, 2017
Friday - Sunday
Michael Hudson
Trump is Obama’s Legacy: Will this Break up the Democratic Party?
Eric Draitser
Donald Trump and the Triumph of White Identity Politics
Jeffrey St. Clair
Roaming Charges: Nothing Was Delivered
Andrew Levine
Ryan’s Choice
Joshua Frank
Global Coal in Freefall, Tar Sands Development Drying Up (Bad News for Keystone XL)
Anthony DiMaggio
Ditching the “Deep State”: The Rise of a New Conspiracy Theory in American Politics
Rob Urie
Boris and Natasha Visit Fantasy Island
John Wight
London and the Dreary Ritual of Terrorist Attacks
Paul Buhle
The CIA and the Intellectuals…Again
David Rosen
Why Did Trump Target Transgender Youth?
Vijay Prashad
Inventing Enemies
Ben Debney
Outrage From the Imperial Playbook
Michael J. Sainato
Bernie Sanders’ Economic Advisor Shreds Trumponomics
Bill Willers
Volunteerism; Charisma; the Ivy League Stranglehold: a Very Brief Trilogy
Lawrence Davidson
Moral Failure at the UN
Pete Dolack
World Bank Declares Itself Above the Law
Nicola Perugini - Neve Gordon
Israel’s Human Rights Spies
Patrick Cockburn
From Paris to London: Another City, Another Attack
Ralph Nader
Reason and Justice Address Realities
Ramzy Baroud
‘Decolonizing the Mind’: Using Hollywood Celebrities to Validate Islam
Colin Todhunter
Monsanto in India: The Sacred and the Profane
Louisa Willcox
Grizzlies Under the Endangered Species Act: How Have They Fared?
Norman Pollack
Militarization of American Fascism: Trump the Usurper
Pepe Escobar
North Korea: The Real Serious Options on the Table
Brian Cloughley
“These Things Are Done”: Eavesdropping on Trump
Sheldon Richman
You Can’t Blame Trump’s Military Budget on NATO
Carol Wolman
Trump vs the People: a Psychiatrist’s Analysis
Stanley L. Cohen
The White House . . . Denial and Cover-ups
Farhang Jahanpour
America’s Woes, Europe’s Responsibilities
Joseph Natoli
March Madness Outside the Basketball Court
Bruce Mastron
Slaughtered Arabs Don’t Count
Pauline Murphy
Unburied Truth: Exposing the Church’s Iron Chains on Ireland
Ayesha Khan
The Headscarf is Not an Islamic Compulsion
Ron Jacobs
Music is Love, Music is Politics
Christopher Brauchli
Prisoners as Captive Customers
M. Shadee Malaklou
An Open Letter to Duke University’s Class of 2007, About Your Open Letter to Stephen Miller
Robert Koehler
The Mosque That Disappeared
Franklin Lamb
Update from Madaya
Dan Bacher
Federal Scientists Find Delta Tunnels Plan Will Devastate Salmon
Barbara Nimri Aziz
The Gig Economy: Which Side Are You On?
Kollibri terre Sonnenblume
Marines to Kill Desert Tortoises
Louis Proyect
What Caused the Holodomor?
Max Mastellone
Seeking Left Unity Through a Definition of Progressivism
Charles R. Larson
Review: David Bellos’s “Novel of the Century: the Extraordinary Adventure of Les Misérables”
David Yearsley
Ear of Darkness: the Soundtracks of Steve Bannon’s Films
FacebookTwitterGoogle+RedditEmail