Howard Dean and “progressive” austerity

Howard Dean has a two-minute video on the YouTube channel of the middlebrow online interview group “Big Think.” Dean argues that the country ought to follow through on all of the consequences of the deficit deal from last year, the so-called “fiscal cliff”: allow all tax rates to return to the way they were before Bush, and go through with the “automatic” cuts both to the military and to domestic programs.

The tempting thing about Dean’s argument is that it may, in fact, be the least bad outcome we can expect at the end of this year, given the intransigence of the teabaggers in Congress. It is the only way, he says, that we’ll ever be able to raise taxes on millionaires or cut into the military boondoggle.

But it’s the inclination to give up on important social programs without a fight that is disturbing, and Dean’s rationale is a crackpot one: nonsense about how “we spent money we didn’t have,” how we might “end up like Greece,” and how “there will be pain” for everyone, inevitably. His most important goal, explicitly stated, is to balance the budget.

This is economic insanity at a time like this, when the so-called recovery has been weak in the United States precisely because of steep cuts in government spending, and going off the “fiscal cliff” will almost certainly cause another recession, especially when combined with the troubles in Europe and increasingly even in China.

Yes, the restoration of the pre-Bush tax rates will raise taxes on the rich, but it will also raise taxes on a broad swath of the middle; that, in fact, may be necessary eventually (as will much steeper tax increases on the rich), but will cause unnecessary economic pain in the short term.

Therefore, focusing political fire directly on the rich and their servants is the necessary course right now, not adjusting our aspirations to their blackmail right away. But Dean represents the fiscally conservative wing of the Democrats, obsessive about balanced budgets, that is probably the majority of Democrats at the Federal level. If there’s an analogy to be made to Greece, these people are like PASOK, the pro-austerity center-left party. The Republicans have their pro-austerity wing similar to New Democracy in Greece, but their burgeoning teabagger element is akin to Greek parties even further right, which are actually anti-austerity parties: they want to keep the enormous tax advantages for the rich, and to the extent that they’ll countenance cuts, it is to cut spending that benefits the working class, and to perpetrate nativist attacks on immigrants, etc.

So actually, we are a lot like Greece already. Except that we have no left.

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