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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

US: the politics of deficit « Previous | |Next »
February 28, 2011

At nearly 10% of GDP, the deficit of the US Government is resulting in a mountain of debt that threatens America’s future. Unemployment is high and the economy is not growing fast enough. No country, including the US, escapes the deleterious consequences of persistent large fiscal deficits. The US has got some fiscal issues.

In War, Debt, and Democracy at Project Syndicate John Ferejohn and Frances Rosenbluth argue that as the United States takes up the decision to lift its self-imposed debt ceiling (through tax cuts for the rich) we should remember why America’s public debt is as large as it is, and how it matters. They say:

among other things, debt-funded wars – say, in Afghanistan and Iraq – are easier to defend than pay-as-you-go wars that voters must finance up front with taxes...America’s extended conflicts in Afghanistan and Iraq...have already cost more than America’s long war in Vietnam, but they have not increased public vigilance or political accountability at home. Indeed, the younger generation of Americans has greeted military action abroad with a yawn.

They ask: 'What accounts for the stark contrast between the mass protests against the Vietnam War and the muted public reaction to the wars in Afghanistan and Iraq?'

Their answer is that Americans take these wars lying down because the costs are not experienced by the average citizen and the US is paying for these wars with debt. They add that deficit spending on wars does buy political time for US administrations to continue prosecuting ill-considered and expensive wars with little domestic scrutiny.

That's not the full story. As Jeffery Sachs points out both political parties, and the White House, would rather cut taxes than spend more on education, science and technology, and infrastructure. And the explanation is straightforward: the richest households fund political campaigns. Both parties therefore cater to their wishes.

| Posted by Gary Sauer-Thompson at 9:41 PM | | Comments (1)
Comments

Comments

Well Ferejohn and Rosenbluth's speculation is deeply flawed about the reasons for the different public response to Vietnam v the current Middle East wars. 58,000 Americans were killed in Vietnam and more than a quarter of a million wounded; the war was supported by conscription. If either the Iraq or Afghanistan adventures had involved anything approaching this they would have been stopped long ago, and only the most extreme wingnuts ever floated the idea of re-introducing conscription.

Conservatives peddle the line that the cost of the wars is insignificant compared to all those entitlements given to the undeserving poor, like social security and health care. Sadly, they appear to have won the propaganda campaign. Conservative politicians in the USA are now openly engaged in union-busting and breaking up the social safety net, while the concentration of wealth in the hands of the top 1% of the population increases from year to year. Presumably the whole place will blow some time but there are few sings that it's imminent.