Our Penny-Wise, Pound-Foolish President

[UPDATE: As some commenters suggested, I jumped to conclusions on the basis of bad reporting. In the immortal words of Emily Littella, "Never mind."]

And America's working (or, more to the point, involuntarily non-working) people are the ones who will pay the price.

Apparently Obama wants to do something about jobs.  But:

"The main thing that people are concerned about is jobs," said Rep. Elijah E. Cummings (D-Md.). "It is the number one issue."

But Obama's options are limited, as the administration already has signaled that it is unwilling to make any investments that would add significantly to the nation's ballooning deficit.

Well, how the fuck else is he going to do something about the job situation??  To create jobs when things just aren't getting any better in the private sector, the government has to spend money to create jobs, and to keep them from being cut by state and local governments.  There's nobody else out there.  And the only two ways the government can get the money to spend is (a) by taxing someone else, presumably rich people, or (b) by borrowing it, which will add to the deficit.  And if the government doesn't spend much, it won't create many jobs.  Period.

We know how well a tax hike on the rich would go over: all 40 Republican Senators would vote against it, and so would some of the Business Dog Democrats in the Senate.  Kiss that one goodbye, unless it's done via reconciliation, and we'd kinda like to save that for health care.

So Obama's pretty much tying his own hands here.  That would be fine if he was the only one suffering consequences, but 10% unemployment is going to hurt an awful lot of people.  They need help.  Just like bankruptcy and foreclosures are hurting an awful lot of people, but Obama wasn't willing to fight for cramdown. 

And even from a cold-blooded, technocratic perspective, it makes no sense.  Sure, a jobs program is going to knock another big hole in the 2010 and 2011 budgets, but lasting high levels of unemployment will knock big holes in the budgets for years to come: people who are unemployed or underemployed don't pay taxes, but they require more government services.  The biggest step to balancing the budget in the medium term - over the next decade - is to get people back to work quickly now.  You'd think a smart Democrat who's concerned about deficits would see win-win there.

And to balance the budgets in the long term, the biggest things we can do now are (a) pass a decent health care bill, so we start having some levers on controlling health care costs, and (b) make major forward-looking infrastructure investments now that will pay off over the coming decades.  These can be anything from really sexy stuff like SUPERTRAINS and a 'smart' power grid, to pretty gritty stuff like fixing antiquated water and sewer systems, and getting rid of bottlenecks in our freight rail system, and filling in some of its more significant missing pieces.

Needless to say, all that infrastructure spending that would make a big difference in our economic situation in 2020 and beyond would create a ton of jobs in the near term.  You'd think a smart Democrat who's concerned about deficits would see win-win there.

But to the extent that Obama decides it's important to keep deficits under control in the next few years, he sacrifices both of those goods: the opportunity to significantly improve the medium and long term budget situations, and the opportunity to keep millions of Americans working right now.

And if he's taking this approach to placate the Evan Bayhs and Fred Hiatts of the world, then shame on him: they don't have any good insights about the long haul, and they damned sure don't care about how government's failure to act will affect ordinary Americans now.

I can only hope that the WaPo has had another reporting malfunction, and that Obama's got the good sense to spend money now to keep people employed - preferably doing stuff that we'll benefit from over the next 50 years or so, but the main thing is to get people back to work.

Comments

[Sir Charles]

I was just arguing this point with a bunch of investment guys. They really don't give a shit about the unemployed. They insist that only private sector jobs (which will emerge over the long haul)can cure this problem. Easy to say I guess if you have a job.

[Eric Wilde]

I'm just fucking sick of the misplaced priorities in our leadership. Spend more money blowing people up; but, don't give a damn about anybody here that is hurting.

[Crissa]

The part you bolded isn't quoted from the administration.

They've easily added to the debt with the stimulus; I think that bold part is wrong.

It's the Republicans and Blue Dogs who want not to add to the deficit.

[Corvus9]

Yeah, "has signaled" is pretty vague phrasing. I think this is too vague, and and too characteristic of WaPo "reporting" to bother getting to worked up about. Most likely, there was some White House official somewhere making some vague and unrelated comment about deficits, or maybe it was some White House Kabuki statement to set up the coming debate that might just be ass-covering in anticipation of going the other way.

I long ago stopped giving any credence to any statements coming from the White House unless they come straight from Obama. It's all positioning meant to to jerk off the mewlers in the Senate. Yeah, it sucks that the centrists have to be placated, but that's just what they have to do to get anything passed. Better they jerk off those assholes and get something passed than not and get nothing passed. It's a dirty job, but someone's got to do it.

[low-tech cyclist]

Better they jerk off those assholes and get something passed than not and get nothing passed.

Truth.

[Crissa]

Yeah, and even with a direct quote from an official, you hafta make sure there's context - like the paragraph in the speech or the question being answered.

Too frequently lately these side-phrases have just seriously been wrong, just added to make the story zing.