There is no deficit crisis. There is a deficit, yes. But it has not reached crisis proportions and is unlikely to.
If you believe the hype you have been duped by the massive propaganda campaign launched by Republicans and a compliant corporate media, the purpose of which is to capture the White House and install a president who will represent the few rather than the many. Sorta like the current president.
An unholy alliance???
Here is the skinny on the deficit propaganda campaign. It was designed to offset any demand for an adequate stimulus and to forestall any future proposals to mitigate the true crisis that exists in the country today – the jobs crisis.
The only way to create jobs is through investment and only investment. Tax cuts just don’t cut it. Since businesses are not investing in new plant and equipment the burden falls to government to invest in the economy. We are all familiar with the government investment that occurred during World War II that finally ended the Great Republican Depression of the 30s.
Today, massive investment by government in infrastructure, green technology, fuel conversion technology, high speed rail, etc., will provide jobs that will stimulate demand and spur private investment.
Republicans have blocked all possibility of this type of investment largely because they are committed to an underhanded plan that will cause the current president to fail. That by the way is their admitted goal stated openly by the GOP leadership. Regardless of the pain and suffering the plan inflicts on millions of Americans they will pursue their devious ends.
How to implement the plan? That’s easy. They’ve read Shock Doctrine by Naomi Klein. If you haven’t done so it’s worth the time. In a nutshell the doctrine states that to impose an agenda on a nation exploit a crisis. If a real crisis does not exist, create one. That can be done by engineering a massive propaganda campaign which is exactly what Republicans and the right wing media are doing in the United States today.
Why is there no deficit crisis? A simple look at the debt to GDP ratio informs us of the truth. According to statistics by a number of economists the current ratio stands at 60/100. That is not a crisis number when compared to the ratio of 120/100 that existed after the war. And some economists claim a ratio of 150/100 is an acceptable number. Currently Japan’s debt to GDP ratio is 228/100. Yes, the Japanese economy has suffered stagnation but it is faring better than the US with an unemployment rate hovering around 5%. What has been the Japanese approach to its prolonged period of stagnation? Why austerity of course. And economists are now attributing Japan’s protracted struggle to its misguided policy of austere spending cuts.
As further evidence that a deficit “crisis” is a myth, US Treasuries are still considered the safest investment in the world and interest rates on bonds are remain near record lows. And this despite one of the most massive propaganda campaigns to besiege the country in recent history.
It is true that rating agencies are threatening to lower the grade of US credit. But that threat has less to do with the deficit and is more a function of Republican recklessness in pursuit of a default to achieve its dastardly goal of safety net destruction. Clearly Social Security and Medicare are in the GOP’s cross-hairs. And once the first step is taken, the floodgates will open and those programs will be dismantled forever.
If you are a wealthy American, million dollar plus portfolio, the GOP’s machinations will suit you well.
If you are a working American you are about to become the victim of the biggest flimflam in the history of mankind.