Excerpt from MICHAEL COHEN's essay in The Guardian
The GOP's zealotry on tax cuts is only matched by its zealotry in pursuing austerity policies. In the spring of 2011, federal spending cuts forced by Republican legislators took much-needed money out of the economy: combined with the 2012 budget, it has largely counteracted the positive benefits provided by the 2009 stimulus.
Subsequently, the GOP's refusal to countenance legislation that would help states with their own fiscal crises (largely, the result of declining tax revenue) has led to massive public sector layoffs at the state and local level. In fact, since Obama took office, state and local governments have shed 611,000 jobs; and by some measures, if not for these jobs, cuts the unemployment rate today would be closer to 7%, not its current 8.2%. In 2010 and 2011, 457,00 public sector jobs were excised; not coincidentally, at the same time, much of the federal stimulus aid from 2009 ran out. And Republicans took over control of Congress.
These cuts have a larger societal impact. When teachers are laid off, for example (and nearly 200,000 have lost their jobs), it means larger class sizes, other teachers being overworked and after-school classes being cancelled. So, ironically, a policy that is intended to save "our children and grandchildren" from "crushing debt" is leaving them worse-prepared for the actual economic and social challenges they will face in the future. In addition, with states operating under tighter fiscal budgets – and getting no hope relief from Washington – it means less money for essential government services, like help for the elderly, the poor and the disabled.
This is the most obvious example of how austerity policies are not only harming America's present, but also imperilling its future. And these spending cuts on the state and local level are matched by a complete lack of fiscal expansion on the federal level. In fact, fiscal policy is now a drag on the recovery, which is the exact opposite of how it should work, given a sluggish economy.
This collection of more-harm-than-good policies must also include last summer's debt limit debacle, which House speaker John Boehner has threatened to renew this year. This was yet another GOP initiative that undermined the economic recovery. According to economists Betsey Stevenson and Justin Wolfers, "over the entire episode, confidence declined more than it did following the collapse of Lehman Brothers Holdings Inc in 2008." Only after the crisis did the consumer confidence stabilize, but employers "held back on hiring, sapping momentum from a recovery that remains far too fragile." In addition, the debt limit deal also forced more unhelpful spending cuts on the country.
Since that national embarrassment, Republicans have refused to even allow votes on President Obama's jobs bill in the Senate; they dragged their feet on the aforementioned payroll tax and even now are holding up a transportation bill with poison-pill demands for the White House on environmental regulation. [MORE]