Sunday, August 7, 2011

TNR Ed Kilgore : "Keynes Is Dead, Just When We Need Him" - "It would take a truly monumental economic crisis to call off the deficit reduction doomsday machine and bring John Maynard Keynes back from the dead"

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I have been following this important writer Ed Kilgore and his co-workers William Galston, Stan Greenberg and Ruy Teixeira. They launched "The Democratic Strategist". I have strong identification with this publication and its wonderful articles.



The New Republic
Keynes Is Dead, Just When We Need Him
by Ed Kilgore
August 6, 2011

Ed Kilgore is the Managing Editor of "The Democratic Strategist", he is also a special correspondent for The New Republic and a senior fellow at the Progressive Policy Institute. He was previously vice president for policy at the Democratic Leadership Council, communications director for former U.S. Sen. Sam Nunn (D-GA), and a federal-state liaison for three governors of his home state of Georgia.

William Galston, Stan Greenberg and Ruy Teixeira launched "The Democratic Strategist".

These important writers wrote this manifesto :

"We are launching this publication because we believe Democrats must begin to develop political strategies that look beyond the standard two- and four-year time horizons set by the American electoral calendar. Democrats must develop a set of concrete and coherent political strategies for regularly winning elections and over the longer term -- perhaps over a decade or more -- winning new areas of support and creating nothing less than a stable Democratic majority in the country".

"In playing this role, The Democratic Strategist will actively and energetically work to include all sectors of the Democratic community. While we as individuals have strong personal views, as co-editors of The Democratic Strategist, we will maintain a firmly neutral meeting ground for both centrists and populists, readers of The Nation and The New Republic, professional political consultants, grassroots activists and supporters of every significant candidate and perspective within the Democratic Party."


Keynes Is Dead, Just When We Need Him


Some excerpts :

When it comes to gaining Republican support, is the apparent popular rejection of Keynesianism enough to make conspicuous Hooverism acceptable? Don’t even non-Keynesians accept that drastic domestic spending cuts tend to directly boost unemployment, even if you deny claims of its other economic effects? Maybe so, but conservatives are so entrenched in the conviction that public-sector jobs aren’t “real,” and so focused on destroying public-sector unionism as a critical political asset for Democrats, that they’re likely willing to run the risk of boosting short-term unemployment. As recently as Tuesday, the GOP was getting lathered up to go after deeper cuts in FY 2012 domestic appropriations. And while progressive claims that Republicans are deliberately trying to sabotage the economy are perhaps unfair, there’s no question they realize the president and his party will get the bulk of the blame in 2012 for perpetually bad economic conditions.

Indeed, a better bet is that conservatives will double down on their own conviction that the only way to bring back economic growth is through deregulation and tax cuts, accompanied by spending cuts. And Democrats, who for their part still believe in Keynes even though they’ve concluded most of the public doesn’t, will resist new austerity measures, but they will also resist new high-end tax cuts in order to accommodate the remorseless demands of the deficit reduction process. Moreover, as the contents of the debt limit deal illustrated, Democrats have decided to make their chief partisan fiscal stand on the politically strong ground of opposing major long-term changes in Medicare and Social Security, even though entitlement reform is probably the only avenue to big-time deficit reduction measures that do not savage discretionary spending. So instead of coming together to deal with what could quickly become a genuine economic emergency, the two parties may soon be farther apart than ever.

When the “super-committee” convenes to accept or come up with an alternative to automatic spending cuts, mostly of the discretionary variety, an extended economic slump will only further reinforce the fact that there is no obvious “solution” that will be acceptable across party lines. That’s one reason analysts like Cassidy think both parties will figure out a way to junk the entire process. But with the spending-cut-obsessed Tea Party faction howling on the sidelines, it seems inconceivable that Republican congressional leaders will be in a position to suddenly announce that it’s decided Dick Cheney was right back in 2002 when he famously said, “Deficits don’t matter.” Indeed, it would take a truly monumental economic crisis to call off the deficit reduction doomsday machine and bring John Maynard Keynes back from the dead.
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