Destroying the Economy and the Democrats
http://www.commondreams.org/view/2013/04/06
Job creation slowed to just 88,000 in March, signaling a sluggish economy. And President Obama, with unerring timing, picked this moment to put out an authorized leak that he is willing to put Social Security and Medicare on the block as part of a grand budget bargain that will only slow the economy further.
The deterioration in economic performance was all too predictable, given the combined lead weights of the March 1 $85 billion of budget cuts in the sequester and the January deal to raise payroll taxes by about $120 billion. (The tax hike on working people was almost double the much-hyped tax increase on the top one percent, which totaled a little over $60 billion.)
Taken together, these twin deflationary deals cut the deficit by around $270 billion dollars this year. Thats close to two percent of GDP. And according to the Congressional Budget Office, this combined contractionary pressure will cut the 2013 years growth rate in half. So the slowdown in job creation is just what youd expect.
The grand bargain that, for the moment, is mercifully eluding President Obama and the Republicans, would apply the same sort of medicine for nine more years, and with the same resultsa prolonged slowdown growth and jobs. Obama and the Republicans are talking of a decade of cuts in the 3 to 4 trillion-dollar range.