An Austerity Program never grows an economy

[nadinbrzezinski]

the only way to grow yourself out of a recession... let alone the future depression... is SPENDING...

Congrats... I guess really basic economics is not the strong point of the corporate controlled government... or worst... not in their interest, which makes you wonder... what interests are they protecting? They certainly are not protecting ours.

Oh and yes I am all for compromise, it is basic for the system of government, but when one side gets 97-99% of what they want... that is not compromise...

That is all.

(And from current reports they are, unless them are trial balloons, that said austerity is coming)

And since austerity is coming.... expect the official unemployment rate to go UP...

[LonePirate]

1. Republicans do not care one iota about austerity. It is simply a tool to destroy Obama.

And they are using that tool pretty damn effectively. If the Republicans reclaim the Senate and the Presidency in 2012, their marriage to austerity will end in a very quick and silent divorce.

[nadinbrzezinski]

2. Problem is that at this point

I gotta think it is both... yes, dark mood and all that.

[SoutherDem]

3. I Agree and when the economy goes in the toilet

Democrats will get all the blame, after all we do have he WH and Senate. Even though we caved in and took the Republican plan. Should some of the blame be ours? Of course! We didn't raise the debt ceiling when we did have the house, we didn't get rid of the Bush tax cuts either and now we caved in to the Republicans. So, I guess in 2012 we will lose big because of a lousy economy, with the Republicans in the WH, in control of the Senate and House we too will be blamed, but it will be a little harder.

[nadinbrzezinski]

4. Oh the blame game has started

and I know that this will push even more people NOT to vote in 2012... I think people will give up on the system and look for other avenues to deal with the sucky times.

[jwirr]

5. No it just lets the rich privatize every thing they can get their hands on. nt

[Yo_Mama]

6. No one's proposing austerity

CBO's got a special page for scoring the plans that have been floated so far:
http://www.cbo.gov/publications/collections/collections.cfm?collect=18

This whole thing's a mirage. No one is proposing meaningful changes on the taxing or the spending side, which is why all the credit rating firms are helpfully pointing out that they will downgrade the US anyway.

[nadinbrzezinski]

7. Cuts to social programs are not?

Ok... I am confused...

[Chan790]

8. The rating agencies...

want to see

a.) a plan that explicitly includes budgeted funds for paying down the debt.
b.) Tax increases to create new revenues then dedicated to paying down the debt.
c.) Serious dedication to debt reduction that can't be wiped away later by act of Congress or punted down the road.

Those social program cuts are not looked upon terribly favorably if they're all that's in the pipeline, even in large quantity...it shows weakness and a willingness to walk away from responsibilities. They want to see a broad spectrum approach. Also, they're in the analysis business...they oppose anything that will lengthen the recession and generally look poorly upon austerity in a slow economy; it increases the likelihood of a later default. The ratings agencies are not the IMF...they don't buy into Friedmanism all that much either since it has never worked.

Debt rating is no place for ideologues.

edit: I forgot d.) They want bigger reduction numbers predicated less on cuts.

[nadinbrzezinski]

9. I will agree with you that debt rating is not a place

for ideologues and we have had smoke signals from WS all week.

But what we are seeing is an austerity program... and it will do what I said... it will slow the economy.

And politically we know who will get the blame... unless the people in places like WS decide they have had it with the ideologues. They just may as even oh some in Fox are being critical

[dkf]

10. I doubt credit rating downgrades grow an economy either.

It's a rock and a hard place.

[nadinbrzezinski]

11. Alas we should not be here

and the downgrade, I fear, is coming either way.

[dkf]

12. It would have come eventually but not yet.

The problem is a downgrade has so much more potential downside simply because we don't know how everything goes down. Austerity is more orderly I imagine.