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Steve Volk

This is the Philadelphia author I recently interviewed on my radio show. I really loved his book “Fringeology”:

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Austerity

Is it something in the Potomac water? Why are so many politicians so blind to the economic suffering of Americans, and so consumed with austerity fever? Dan Froomkin with an excellent piece:

For the weeks leading up to the agreement, Democratic and Republican leaders were essentially trying to out-austere each other. It’s that bipartisan enthusiasm for reducing the government’s budget — and the speed with which both parties abandoned a job-creating agenda — that left-leaning analysts say demonstrate how beholden elected officials from both parties have become to the rich, and how out of touch they are with the problems of the poor and the middle class.

“If these people were rational policymakers, they would not focus on deficit reduction right now,” said Neera Tanden, chief operating officer at the Center for American Progress. “They would focus on stimulus right now.”

“What’s crazy about Washington is that the only thing we talk about is deficit reduction; that nobody talks about jobs,” Tanden said. “It’s borderline insane.”

To liberal economists like University of Texas professor James Galbraith, the explanation lies in what he calls the Washington elite’s “deficit hysteria.”

From this perspective, the spending cuts signed into law Tuesday were the culmination of the investment of hundreds of millions of dollars by moneyed interests into the development and inculcation of a specific Washington consensus that anyone who doesn’t believe the government is dangerously overextended — and who doesn’t consider the danger of deficits as very, very serious — is a wild-eyed radical.

“The rich have drawn a political box around what can be done here,” said Damon Silvers, policy director for the big umbrella union AFL-CIO. “They are gutting the modern state in order to avoid a real conversation about taxes.”

[...] Davig, the investment banker, said economic growth is not the most significant issue for Wall Street.

“Everyone can live with a little bit of fiscal drag if there’s a little bit more stable macro landscape,” he said. “They’re happy to live with a little bit of fiscal drag.”

And Galbraith said he thinks some of the super-rich out there, sitting on all that cash, are actually hoping for the economy to crash and burn.

“The strategy of pursuing a deflationary strategy is a strategy that greatly benefits people with cash,” said Galbraith. “If you’re interested in deflating asset values, and you have cash with which to buy assets when things hit rock bottom, then you have a powerful interest in a deep depression.”

“That’s certainly consistent with the banks holding 1.4 trillion [dollars] of reserves, which is absolutely unprecedented,” said Pollin, who backs a tax on excess reserves. “That’s 10 percent of GDP.”

Whatever Grover wants

Grover gets to pick the Super Committee!

Norquist said he has already been assured by “the right people” that House Speaker John Boehner (R-Ohio) and Senate Minority Leader Mitch McConnell (R-Ky.) will not choose anyone willing to give ground on raising taxes, and he is confident enough to leave town on Wednesday for August vacation.

Norquist said he would like Boehner to name House Budget Committee Chairman Paul Ryan (R-Wis.), House Ways and Means Committee Chairman Dave Camp (R-Mich.) and House Energy and Commerce Committee Chairman Fred Upton (R-Mich.).

He said he would be “fine” with leadership using the opportunity to give a conservative freshman the chance to shine, mentioning Rep. Kristi Noem (R-S.D.).

Similarly, with respect to the Senate, Norquist can see McConnell appointing a young gun like Sen. Marco Rubio (R-Fla.) to the panel to give him a bigger platform. He said he would like to see Sens. Orrin Hatch (R-Utah) and Jeff Sessions (R-Ala.) appointed.

Norquist does not want to see former Gang of Six Sens. Tom Coburn (R-Okla.) or Saxby Chambliss (R-Ga.) on board because they made “troubling” statements in support of revenue increases during the deficit negotiations this spring. He said that if Gang of Six Sen. Mike Crapo (R-Idaho) made stronger commitments to oppose taxes, he could be OK with that appointment.

The little tin god who spends his life in the closet… all hail Caesar!

Oh boy

John Aravosis with a real doozy of a story:

From Ben Smith, who confirmed it from two sources, we learn that at last night’s “Common Purpose” meeting, a regular (supposed to be secret) get together between the White House and progressive advocacy groups (where the White House routinely yells at them, I hear), the groups got an earful about the President’s new deficit deal he reached with Republican Speaker John Boehner:

Yesterday, [White House National Economic Council Director Gene] Sperling faced a series of questions about the White House’s concessions on the debt ceiling fight, and its inability to move in the directions of new taxes or revenues. Progressive consultant Mike Lux, the sources said, summed up the liberal concern, producing what a participant described as an “extremely defensive” response from Sperling.

Sperling, a person involved said, pointed his finger backed at liberal groups, which he said hadn’t done enough to highlight what he saw as the positive side of the debt package — a message that didn’t go over well with participants.

That sounds oddly familiar. In fact, it’s the same admonishment a group of liberal bloggers received from then- vice presidential economic adviser Jared Bernstein on the one-year anniversary of the stimulus. I attended that meeting and wrote at the time, back in February of 2010:

I guess what struck me as most interesting about the meeting were two things. First, when Bernstein noted that, in trying to solve the country’s economic problems, the administration faces “budget constraints and political constraints.” By that, I took Bernstein to mean that the stimulus could only be so large last time, and we can only spend so much more money this time, because we’re facing a huge deficit, so there’s not much money to spend, and because the Hill and public opinion won’t let us spend more.

That struck me as GOP talking points winning the day, and I said so (Professor Kyle wrote about this very notion the other day on the blog). The only reason we’re facing a budget constraint is because we gave in on the political constraint. We permitted Republicans to spin the first stimulus as an abysmal failure, when in fact it created or saved up to 2m jobs. Since Democrats didn’t adequately defend the stimulus, and didn’t sufficiently paint the deficit as the Republicans’ doing, we now are not “politically” permitted to have a larger stimulus because the fiscal constraint has become more important than economic recovery.

And whose fault is that?

Apparently ours.

Bernstein said that the progressive blogs (perhaps he said progressive media in general) haven’t done enough over the past year to tell the positive side of the stimulus.

[...] In any case, this isn’t a coincidence. They actually believe, inside the White House, that we’re to blame for their problems. That they’re doing a chipper job and the public would know it, but for the Netroots and the liberal advocacy groups doing such a lousy job selling the President’s magnificent handiwork.

Breaking up

Rude Pundit says, “It’s not me, it’s you” to the president.

Salmonella

36 million pounds of ground turkey.

Born under a bad sign

Booker T. Jones with Daryl Hall and Mayer Hawthorne:

Just ain’t gonna work out

Meyer Hawthorne with Daryl Hall:

How it works

‘I don’t think assigning blame is what our job is’

There’s an interview in the Columbia Journalism Review with David Leonhardt, the NY Times’ new Washington bureau chief. Go read it to get some idea of just how wedded these journalists are to getting it wrong.

On a roll

More Matt Damon:

“I’m so disgusted,” he told a reporter about the protracted negotiations. “I mean, no, I don’t know what you do in the face of that kind of intransigence. So, my heart does go out to the President. He is dealing with a lot.”

Still, despite any sympathy, he was furious with the negotiations’ outcome, as well as the greater thrust of American economic policy.

“The wealthy are paying less than they paid at any time else, certainly in my lifetime, and probably in the last century,” Damon said. “I don’t know what we were paying in the roaring 20’s; it’s criminal that so little is asked of people who are getting so much. I don’t mind paying more. I really don’t mind paying more taxes. I’d rather pay for taxes than cut ‘Reading is Fundamental’ or Head Start or some of these programs that are really helping kids. This is the greatest country in the world; is it really that much worse if you pay 6% more in taxes? Give me a break. Look at what you get for it: you get to be American.”

When asked whether he thought tax cuts helped create jobs, he was more than clear in his belief that they do not, and struck again on the inequality in the nation.

“I didn’t go start a small business with my tax break, and I don’t know anyone else who did. No, everybody’s socking their money away,” he said. “I was against those tax cuts. I thought they were ridiculous. So little is asked of the upper class anyway. I mean, what percent of them or their kids are fighting in any of these wars? What percent of their day is occupied by the fact that there are men and women in positions over the world, risking their lives. If you walk down 5th Avenue, there’s no sense of shared sacrifice.”

Damon has long been vocal politically; he campaigned with then-Senator Obama in 2008, though earlier this year he hit out at the President on education and economic policy.

“I really think he misinterpreted his mandate. A friend of mine said to me the other day, I thought it was a great line, ‘I no longer hope for audacity,'” Damon told Piers Morgan in March. “He’s doubled down on a lot of things, going back to education… the idea that we’re testing kids and we’re tying teachers salaries to how kids are performing on tests, that kind of mechanized thinking has nothing to do with higher order. We’re training them, not teaching them.”

And on economics, he told the UK’s Independent, “I think he’s rolled over to Wall Street completely. The economy has huge problems. We still have all these banks that are too big to fail. They’re bigger and making more money than ever.”

How can you not love the man who wrote these scenes for “Good Will Hunting”?

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