Why Worry About a Deficit Now?

The Chicago school of economics destroyed Chile's economy by 1989 with right-wing ideology that privatized social programs, castrated trade unions, and promoted completely "free" trade by abdicating any responsibility to regulate the financial markets. Now they've done the same here, and the American wealth that hasn't been dissipated is mostly in the Cayman Islands.

Tinkering with monetary policy can't pull the nation from this recession; Neo-Keynesian policy offers the greatest chance of minimizing the coming depression. Shift sacrifices back onto the backs of those who can bear them and increase government spending in programs that favor labor over banks. Dwight David Eisenhower warned the country of the dangers of coupling our economy too tightly to defense industries, but instead of listening, Nixon just hid the numbers by pulling reserve fund accounting into the fiscal accounting. Ever since Ronald Reagan encouraged firms to plunder employee pension funds, the financial sector has played an artificially high role in GDP to the detriment of production and investment in real assets. Republican policies have transformed our nation from a capitalist society to an oligopoly with a hereditary aristocracy. We have to get back to nuts and bolts with a tax policy that encourages investments that help the American people and punish those who speculate to our detriment. We need a fiscal policy that levels the playing field for local businesses so that retailers can compete with Walmart, Staples, and Home Depot and manufacturers can supply more of our domestic needs.

The government has lied for years about the unemployment rate: we have a glut of workers and surfeit of jobs that is worsening with each generation. We lie about inflation: household debt levels are atrocious because lowered household incomes are not a living wage. The government lies about fiscal policy to gain public support to fight a "welfare state" that simply doesn't exist. The real problem is "jobs, jobs, jobs" and has been for years. First the jobs left the rust belt for the sun belt; then they left the country altogether. Monetary policy for a "strong" dollar undermines the best long-term interests of our people, encouraging reckless reliance on fossil fuels and imported goods to the detriment of our own citizens.

Regardless of the toxic debt run up by this administration to little purpose, some government deficit spending will be essential for the next few years. Some of the pain that the increased debt will entail should be borne by those who profited the most under the policies that favored capital over people; however,

In troubled economic times, we should follow President-elect Obama's lead to promote investment in infrastructure and a green economy.