MARK THOMA has an appropriately succint post up today which reads in its entirety (and I hope he’ll forgive my quoting the whole thing):
We have enough money to pay for military action in Libya, but not for job creation?
It’s hard not to be cynical about government policymaking, and this is why. Forget about fiscal stimulus for the moment. At present, both Republicans and Democrats are committed to cutting the government’s budget in the current fiscal year. These cuts will almost certainly threaten programmes with positive economic returns; job retraining programmes are on the chopping block, for instance. Certainly few party leaders are seriously discussing new spending on programmes with positive economic returns. America has substantial infrastructure needs—current spending is inadequate to simply maintain critical infrastructure at its current state of repair—and yet the odds of passing a new transportation law to replace the one that was scheduled to expire in 2009 but which has since been extended repeatedly, well, they’re close to zero. Why? No one can agree on a way to fund new infrastructure spending.
Libya poses no threat to America. It’s far from clear that American intervention will yield positive outcomes for Libyans. And yet here America goes, launching massively expensive sorties, dropping massively expensive ordnance. And obviously it isn’t just America, Britain managed to join the fight despite its austerity drive.
The point here is not that government spending should never be cut. It should be, and it almost certainly must be if America is to avoid a serious fiscal crisis down the road. But for a very long time now, much of official Washington—Democratic and Republican leaders, along with policy intellectuals and op-ed pages—has acted as though an immediate fiscal crunch loomed. This was never true. American debt levels may be an issue by the end of the decade, but they aren’t now, and deficits are forecast to fall sharply for the next few years. Bond yields have rarely been lower. The fiscal problem is long-term, not short-term. And yet dire fiscal scenarios have been used to sell painful short-term cuts, some of which were necessary but could have been accomplished later, many of which weren’t necessary at all. Americans have been told, by the president of the United States and his chief Republican antagonists, that in hard times the government, like households, must tighten its belt. And then along comes Libya to put the lie to all of these assertions.
The really, really troubling thing about this is that Washington will almost certainly ignore the inconsistency. I doubt any pundits will take the opportunity to observe that Washington leaders apparently don’t actually believe that America faces immediate fiscal constraints (as it does not). Indeed, I wouldn’t be surprised to hear the argument that military action demands greater fiscal probity now.
As I said, it’s hard not to be cynical.
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1-9 of 9 Doug Pascover wrote: Mar 21st 2011 12:37 GMT
I think this post is right, almost entirely. But the one criticism I think would be fair is this: While retraining is measurably good for the economy and probably pays for itself over the long-term, it’s at least unclear whether macroeconomic fiscal policy is good for the economy, by which I mean workers, in the long-term and likewise with monetary expansion. On the other hand, boxing in desperate dictators is probably always a good thing for humanity. To the extent that the guns and butter in this debate are shutting down the assault on Benghazi and once-counter-and-now-pro-cyclical fiscal policy, it isn’t clear that the choice on the table of intervening in Libya and decoupling the economy from stimulus is mad. That might even be two good choices.
I understand that the blogger is talking about the fine points of how congress and the president are going about that decoupling, and I agree that the choice of budgetary targets is kabuki in an asylum. But given that this is the objection, I don’t see how Libya has anything to do with it. We are cutting job preparation and education because policymakers are too timid to adjust entitlements (yes, and the military.) Whether or not we shoot Tomahawks at Tripoli doesn’t change the problem any more than cutting planned parenthood changes the problem.
Recommend (2) Permalink Report abuse mtangent wrote: Mar 21st 2011 1:23 GMT
Without cynicism, politics just wouldn’t make sense.
Recommend (1) Permalink Report abuse fundamentalist wrote: Mar 21st 2011 1:24 GMT
Yes, it’s very, very hard not to be cynical. In fact, it’s beyond me.
Recommend (2) Permalink Report abuse Doug Pascover wrote: Mar 21st 2011 1:33 GMT
Yeah, Fundy. I gave up before the pressure got too bad.
Recommend Permalink Report abuse Stephen Morris wrote: Mar 21st 2011 1:43 GMT
“massively expensive sorties, dropping massively expensive ordnance”.
Whenever the military is deployed, an interesting question arises concerning average and marginal costs. What is the marginal cost of the operations? Presumably the wage costs of soldiers and the maintenance costs of equipment remain largely unchanged. And what eventually happens to bombs that are not used? Presumably they must eventually be serviced or decommissioned – at some cost.
So, while there is no doubt a positive marginal cost in going to war, it may not be as high as it at first appears.
Recommend (1) Permalink Report abuse bampbs wrote: Mar 21st 2011 1:56 GMT
Just because democracy is the best form of government doesn’t mean it’s any damned good. The pols do what they believe they have to do to get and keep their jobs. We put them there. The problem is the ignorant inconsistency of our own laughable demand to pay less and get more. The government is us, and so long as we have the vote, we get what we deserve.
Only a great crisis can turn the American people from squabbling, petty children into adults who acknowledge the need for cooperation and self-sacrifice. Perhaps if we had had on 9/11 a man in the White House with a shred of greatness in him, that could have brought the change. But Dubya had his chance, and he was clueless.
Recommend (1) Permalink Report abuse cs r wrote: Mar 21st 2011 1:59 GMT
Let me point out the headline from one of your editorial leaders in the print edition 3 days ago:
“No illusions: The Arab awakening is succumbing to violence. The outside world has a duty to act”
You guys said duty to act…
Recommend (5) Permalink Report abuse nom de marcsobel wrote: Mar 21st 2011 3:24 GMT
I have been using the Internets to look at every analysis of our Libyan adventure including the President’s speech. I search using the browser page search function for the word “oil” If I don’t find it, I assume that the writer is either hiding, ignoring, or ignorant of the facts.
I think we are there for humanitarian reasons to protect the innocent oil.
This could end as successful as Iraq where we ended up getting the oil after a little bit of trouble.
Recommend Permalink Report abuse BnFrkln wrote: Mar 21st 2011 3:35 GMT
Great post.
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