Long puff piece by Andrew Ross Sorkin on the cerebral Obama at the New York Times.
Closing paragraph quote from Obama interests me: “If we can’t puncture some of the mythology around austerity, politics or tax cuts or the mythology that’s been built up around the Reagan revolution, where somehow people genuinely think that he slashed government and slashed the deficit and that the recovery was because of all these massive tax cuts, as opposed to a shift in interest-rate policy — if we can’t describe that effectively, then we’re doomed to keep on making more and more mistakes.”
This is my response:
President Obama: "If we can’t puncture some of the mythology around austerity politics"
You've done a pissed poor job of that, sir. You functionally became the Nation's leading Deficit Terrorist. Thank God the Tea Party's recalcitrance and extremism prevented your "Grand Bargain." Romney would have otherwise destroyed you in 2016. Still you compromised on lesser terms and the result has led to budget chaos and economic malaise. The American economy can do far better. Given the massive demand leakages, taxes remain too high for the size government and size credit expansion that we have. Yes, you've said somethings against extremist Deficit Terrorism that show a brain is still up there thinking, but you have never put the puzzle together. The horrible irony is that former President George W. Bush held and said the most PROGRESSIVE statement in modern times related to the government deficit and he was lampooned by the Press. As a consequence of Warren Mosler's counsel of White House Chief of Staff Andy Card, when asked about the government deficit in relation to his tax cut and spending proposals in the the spring of 2003, George W. Bush said in Abba Lerner like language to reporters: "I don't worry about numbers on pieces of paper, I worry about JOBS!" That's the most anti-Deficit Terrorist statement of all time by a President. Let us reflect on that for a moment. The hated George W. Bush was more Left Progressive on the government budget than the current Democratic President. Deal with it in your own time.
"or tax cuts"
The 2% payroll tax cut probably saved your presidency, sir. That was probably the best proposal to come out of the whole recovery response. You should say thank you to Warren Mosler for leading that charge and being the earliest to recognize the necessity of a payroll tax cut in the summer of 2008. His full payroll tax holiday proposal was eventually water-downed into the 2% cut. Taxes regulate demand, they don't give the currency issuing monopolist government its own funds to spend or lend. The funds to pay taxes and buy government securities come from government spending (or lending*).
*You have to have government spending preceding lending or there is no one credit worthy to lend to.
"or the mythology that’s been built up around the Reagan revolution, where somehow people genuinely think that he slashed government and slashed the deficit"
Reagan was one of the greatest Keynesian presidents of all time. Spending billions on defense and doing little to cut the growth of overall spending.
"and that the recovery"
We the People never really recovered.
"was because of all these massive tax cuts"
Reagan cut taxes on rich people, but he also later raised payroll taxes on working people, and that's what killed the Reagan era expansion and dragged out an economic malaise into the Clinton years until the credit expansion in the economy restored higher total spending levels.
"as opposed to a shift in interest-rate policy"
What the hell are you talking about, Mr. President? Are you some sort of Monetarist crank? Reagan blew up the deficit and the economy boomed. Interest rates have marginal effects and they are not uniform in every economic state. They were not a leading cause of the Reagan era expansion. Government spending and the growth of consumer credit was, which was not led by interest rates, but deregulation of finance and technological developments.
"— if we can’t describe that effectively,"
Well, you have kind of screwed up the story already, sir. Hard for anyone to make sense of anything with so much confusion from the top down. Deficit Terrorism is the problem, not austerity per se. The time for austerity is when the economy is too hot and trade offs are inevitable between public purpose government spending and consumer purchasing power due to the real economic constraints. That's when fiscal conservatism applies, but it never directly has to do with the government deficit per se. If President Obama would simply invite the MMT headliners to the White House and put attention on them, we could create conditions in this country for the largest economic expansion of all time. Give the MMT'ers a chance to have a conversation with the American people.
"then we’re doomed to keep on making more and more mistakes.”
You are absolutely correct, Mr. President. Are you prepared to listen and begin with the man in the mirror?
Yeah...damn Obama. What we need to do is elect a liberal MMTer to the presidency and members of Congress who won't compromise on anything. We'll show those Tea Partiers who won't compromise. We'll elect a slate of liberals to Congress who will promise to ramp up spending instead of cutting spending. They will promise more spending on education, infrastructure, climate change, and a bunch of other stuff without raising taxes. And no compromises with those Tea Party "No Compromisers". Our no compromisers will out no compromise the Tea Party no compromisers. That's the kind of a king and Congress that the American people want. Throw all those damn compromising centrists out of office. We will stand firm.
Americans like toughness...resoluteness.