Krugman confirmed: Obama Political Team Handcuffing Recovery

[BurtWorm]

Yesterday, Paul Krugman reported a conversation he had with George Stephanopoulos, who told him that someone high up on the WH's political team was pushing a deficit-hawk line on spending, jobs and taxes. Some scoffed at Krugman's citing of Steph. as a credible source. Oh well...


http://www.huffingtonpost.com/2010/07/06/mayberry-machiavellis-oba_n_636770.html



By Ryan Grim

Under the leadership of President George W. Bush, science, empirical evidence and expert advice struggled to be heard above the din of politics. It's one thing to prioritize politics over good policy; it's quite another to let bad politics drive the agenda. But that's what the Bush administration did during its Terri Schiavo era and his congressional majorities paid the price.

Today, a new band of Mayberry Machiavellis has gained control, counseling President Obama to ignore the advice of his economic team and press forward with deficit reduction ahead of job creation.

Senior White House adviser David Axelrod told the New York Times recently that "it's my job to report what the public mood is." The public mood, said Axelrod, is anti-spending and anti-deficit and so the smart politics is to alleviate those concerns. "I've made the point that as a matter of policy and a matter of politics that we need to focus on this, and the president certainly agrees with that," said Axelrod of the deficit hawkery that the administration has engaged in over the last several months.

It's an odd political strategy because Axelrod knows that if it succeeds, it will be both bad policy and bad politics. He said as much when asked about the pressure from economic advisers to focus on stimulus and job creation. "I'm very much allied with the economic group, because even as a political matter it would be very shortsighted to take steps that would send us backward," he said.

But the Mayberries have already taken those steps: by using the bully pulpit to highlight deficit fears, by proposing an across-the-board spending freeze, by creating a commission to reduce the deficit and stacking it with hawks, by making it clear to progressive allies that the White House political team believes a deficit-reduction focus is important for the midterm elections. The one recent effort by the President to pressure Congress to move forward with jobs-related spending came in a letter sent on a Saturday evening that was met with derision on the Hill for its ham-handedness.

[Octafish]

1. Wall Street and Big Business love deficit reduction through budget cuts.

It means they won't have to pay for deficit reduction through business tax increases.

Red Ink Reagan started the nation on Supersize Deficits by cutting the corporate tax rate from 50- to 28-percent.

The middle class has been strapped with making up the difference ever since.

[DirkGently]

2. Sad if this is the case. Sounds like Axelrod knows better.

Bad policy in the cause of political expediency WILL backfire. Get the jobs numbers up and the deficit hawks will wither and blow away.

[backscatter712]

6. Think another chess move ahead.

Yes, I know, I'm asking for those 11th-dimensional chess taunts.

But if the mood of the country really is deficit-hawkish, even though such policy is stupid, then the thing to do would be to make a few public moves indicating concern about the deficit, that don't actually do anything. As Axelrod said, "alleviate those concerns" without actually doing anything.

So put together the catfood commission, but in a few months, quietly ignore and blow off its recommendations when the public's focused on whatever shiny thing the media's holding in front of the TV cameras at the time.

[NJmaverick]

3. Talk about deceptive spin, this headline is beyond belief

and for good reason, it's not supported by Krugman's own words.

[BurtWorm]

4. Krugman said:

I was on Good Morning America this not-so-good morning, doing what I could. But I was struck by something that George Stephanopoulos said: he claimed to have been speaking to an administration official who asserted that what we need to get businesses investing is for business to know that the government has stopped — presumably, that means no new spending, no new regulation, whatever.

GS is a careful guy, so this must be true. And it’s shocking — not that people are saying this, but that someone inside the administration is saying it.

It’s garbage, of course: businesses are refusing to invest because they don’t see enough demand for their products. And administration economists know that it’s garbage. But obviously some people in the WH — I’m guessing a political person, but who knows — have bought the right-wing line hook, line, and sinker.


From the OP:

Senior White House adviser David Axelrod told the New York Times recently that "it's my job to report what the public mood is." The public mood, said Axelrod, is anti-spending and anti-deficit and so the smart politics is to alleviate those concerns. "I've made the point that as a matter of policy and a matter of politics that we need to focus on this, and the president certainly agrees with that," said Axelrod of the deficit hawkery that the administration has engaged in over the last several months.

[amborin]

5. K&R the deficit is largely due to public's forced bailing out of Wall St.'s private debt...

now the ordinary citizens must endure austerity, while the bailed out banksters live high on the hog