The Swamp of Washington and the Morass of the Economy

Washington was built on a swamp. In the summer, temperatures can reach over 100 degrees — as they did over the last few days when I made the rounds of Washington Democrats, repeatedly asking why no bold jobs plan is emerging.

Here’s a sample of their responses:

“Dead in the water. We’ll be lucky if we get votes to raise the debt ceiling without major spending cuts this year and next.”

“Are you kidding? It’s all budget deficit, budget deficit, budget deficit. Nobody’s thinking about anything else.”

“Republicans beat us up so bad over the first stimulus there’s no way we’re gonna try for a second.”

“We got them [Republicans] cornered on Medicare. Now they want to change the subject to jobs. Forget it.”

“No need. We’ll see job growth in the second half of the year.”

“The President doesn’t want to put anything on the table he can’t get through Congress.”

And so it went. Not a shred of urgency.

This morning I was on ABC’s “This Week” with Republican Senator Richard Shelby of Alabama, talking about jobs and the economy. We were wedged in between heated discussions about Anthony Weiner. Shelby’s remarks were from the standard Republican playbook of spending cuts and tax cuts (except for one instant when he inadvertently conceded America emerged from the Great Depression only when government spent big time mobilizing the nation for World War II.)

But what struck me most was the similarity between Shelby’s attitude and that of the Democrats I talked with — a kind of shrug of the shoulders, a sense that it’s really not all that bad out there, and that nothing can be done anyway. (In the green room, before going on, Shelby told me employment in northern Alabama was actually fairly good and the problem was near the coast.)

The recovery is stalling across the nation yet in the Washington swamp it’s business as usual.

Americans are scared. The recovery is running out of steam. We’re in a vicious cycle in which lower wages and net job losses and high debt are causing consumers to cut their spending — which is causing businesses to cut back on hiring and reduce pay. There’s no way out of this morass without bold leadership from Washington to rekindle consumer demand.

If the Democrats remain silent, the void will be filled by Republicans selling the snake oil that all we need do cut federal spending, balance the budget, and cut taxes on big corporations and the wealthy. Nothing could be further from the truth, but Americans won’t know it unless the Democrats — starting with the President — have the courage and conviction to tell the nation what’s happening and what must be done.

About Robert Reich 545 Articles

Robert Reich is the nation's 22nd Secretary of Labor and a professor at the University of California at Berkeley.

He has served as labor secretary in the Clinton administration, as an assistant to the solicitor general in the Ford administration and as head of the Federal Trade Commission's policy planning staff during the Carter administration.

He has written eleven books, including The Work of Nations, which has been translated into 22 languages; the best-sellers The Future of Success and Locked in the Cabinet, and his most recent book, Supercapitalism. His articles have appeared in the New Yorker, Atlantic Monthly, New York Times, Washington Post, and Wall Street Journal. Mr. Reich is co-founding editor of The American Prospect magazine. His weekly commentaries on public radio’s "Marketplace" are heard by nearly five million people.

In 2003, Mr. Reich was awarded the prestigious Vaclev Havel Foundation Prize, by the former Czech president, for his pioneering work in economic and social thought. In 2005, his play, Public Exposure, broke box office records at its world premiere on Cape Cod.

Mr. Reich has been a member of the faculties of Harvard’s John F. Kennedy School of Government and of Brandeis University. He received his B.A. from Dartmouth College, his M.A. from Oxford University, where he was a Rhodes Scholar, and his J.D. from Yale Law School.

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2 Comments on The Swamp of Washington and the Morass of the Economy

  1. The Republicans are engaged in a strategy which I call “squeeze down economics”. I am no economist but just an average worker trying to stay alive. Five years ago and most of my thirty plus years of working as a productive worker in the workforce, I have had the ability to buy things I really didn’t need but wanted. This is no longer the case. I am even having a hard time paying for health insurance now. My real estate taxes increased 15% in one year in order to pay for the services that are needed like schools, police, etc.. The price of gas and food increase willy nilly. I am only working half the hours I worked previously because the work is no longer there. Repeatedly the Republicans solution is to “squeeze down” the working class to enable their base to live in the status quo while I and others are losing the ability to survive. I see the GOP as opportunists in a stagnant economy trying to take away a quality of life we all enjoyed only five, ten, or even twenty years ago. I am not only afraid of losing a pension that I spent over twenty years accumulating but now the GOP is after medicare and probably social security. Will I be living in the streets when I am old and frail? Is this the direction that our leaders would take us and our children into? What is going on with the people we elected to represent us? I am all to aware that my situation is better than many but it sure seems to me that we are all heading in a real bad direction and in a hurry. Is this America? Why are politicians holding us ransom for their own political desires? Why the shortsightedness? Is this country being sold off to corporate interests? The answer is to put money back into both the worker class and the wealthy. When the worker is able to extra spend cash that he has (as opposed to borrowing) obviously the economy expands. The more you squeeze the majority the more the economy shrinks. Growing government is just a by product of an expanding economy. Shrinking the government or squeezing the lower classes does absolutely nothing for anybody.

  2. Demand side is the right approach. I see all types of products being supplied to me (Jamaican vacations, cars, gold etc..). I would buy some of these if I had the means. Problem is that I can barely afford what I need now like food, gas, insurance. Soon that market will dry up. Then what? Put the money in the economy first by job expansion (Reich is rolling eyes because this is so obvious). How could anybody disagree with that? We are well on our way to becoming a third world economy with the leadership we have in DC.

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