The liberal understanding of the economy and its problems has been, in recent months and years, superior to the conservative understanding of the country and its problems. And this has only sharpened in recent weeks, as the Republican Party has spun off into the Gamma Quadrant with laughable theories about ACORN and Fannie Mae and Freddie Mac and the Community Reinvestment Act of 1977. Their argument isn’t wrong in the sense that it’s a serious engagement with the situation that happens to be less empirically sound than competing theories. It’s just nonsense. And this isn’t a time when we can afford governance powered by nonsense. We need governance by people who understood the magnitude and nature of the problem, and have some idea how to go forward fixing it.
And as Robert Reich put things last week:
For years, regardless of the business cycle, American consumers were the Energizer Bunnies of the world economy. Their spending kept it going. But now the Energizer Bunnies have turned into scared rabbits, and they’re going back into their holes.
Yes, we need better regulation of Wall Street in order to avoid the sort of bubbles and distrust that have generated a credit crisis. But even more than that, we need to get money back into the pockets of average American consumers — including major investments in infrastructure, affordable health care, and a more progressive tax code.
Easier said than done, of course, but when you hear Republicans blither on about balanced budgets and lowering capital gains taxes it’s kind of hard not to simply burst out laughing. Yeah, let’s suck a few trillion more out of the economy and see what happens.
As it turns out, the “Old Europe” types the Bushies were so happy to excoriate a few years ago seem to be the only ones with half a clue about how to start fixing the economic mess. Talk about irony.