[Vision2020] Rubio and the Zombies

Art Deco art.deco.studios at gmail.com
Fri Feb 15 04:56:24 PST 2013


  [image: The New York Times] <http://www.nytimes.com/>

------------------------------
February 14, 2013
Rubio and the Zombies By PAUL
KRUGMAN<http://topics.nytimes.com/top/opinion/editorialsandoped/oped/columnists/paulkrugman/index.html>

The State of the Union address was not, I’m sorry to say, very interesting.
True, the president offered many good ideas. But we already know that
almost none of those ideas will make it past a hostile House of
Representatives.

On the other hand, the G.O.P. reply, delivered by Senator Marco Rubio of
Florida, was both interesting and revelatory. And I mean that in the worst
way. For Mr. Rubio is a rising star, to such an extent that Time magazine
put him on its cover, calling him “The Republican Savior.” What we learned
Tuesday, however, was that zombie economic ideas have eaten his brain.

In case you’re wondering, a zombie idea is a proposition that has been
thoroughly refuted by analysis and evidence, and should be dead — but won’t
stay dead because it serves a political purpose, appeals to prejudices, or
both. The classic zombie idea in U.S. political discourse is the notion
that tax cuts for the wealthy pay for themselves, but there are many more.
And, as I said, when it comes to economics it appears that Mr. Rubio’s mind
is zombie-infested.

Start with the big question: How did we get into the mess we’re in?

The financial crisis of 2008 and its painful aftermath, which we’re still
dealing with, were a huge slap in the face for free-market fundamentalists.
Circa 2005, the usual suspects — conservative publications, analysts at
right-wing think tanks like the American Enterprise Institute and the Cato
Institute, and so on — insisted that deregulated financial markets were
doing just fine, and dismissed warnings about a housing bubble as liberal
whining. Then the nonexistent bubble burst, and the financial system proved
dangerously fragile; only huge government bailouts prevented a total
collapse.

Instead of learning from this experience, however, many on the right have
chosen to rewrite history. Back then, they thought things were great, and
their only complaint was that the government was getting in the way of even
more mortgage lending; now they claim that government policies, somehow
dictated by liberals even though the G.O.P. controlled both Congress and
the White House, were promoting excessive borrowing and causing all the
problems.

Every piece of this revisionist history has been refuted in detail. No, the
government didn’t force banks to lend to Those People; no, Fannie Mae and
Freddie Mac didn’t cause the housing bubble (they were doing relatively
little lending during the peak bubble years); no, government-sponsored
lenders weren’t responsible for the surge in risky mortgages (private
mortgage issuers accounted for the vast majority of the riskiest loans).

But the zombie keeps shambling on — and here’s Mr. Rubio Tuesday night:
“This idea — that our problems were caused by a government that was too
small  — it’s just not true. In fact, a major cause of our recent downturn
was a housing crisis created by reckless government policies.” Yep, it’s
the full zombie.

What about responding to the crisis? Four years ago, right-wing economic
analysts insisted that deficit spending would destroy jobs, because
government borrowing would divert funds that would otherwise have gone into
business investment, and also insisted that this borrowing would send
interest rates soaring. The right thing, they claimed, was to balance the
budget, even in a depressed economy.

Now, this argument was obviously fallacious from the beginning. As people
like me tried to point out, the whole reason our economy was depressed was
that businesses weren’t willing to invest as much as consumers were trying
to save. So government borrowing would not, in fact, drive up interest
rates — and trying to balance the budget would simply deepen the
depression.

Sure enough, interest rates, far from soaring, are at historic lows — and
countries that slashed spending have also seen sharp job losses. You rarely
get this clear a test of competing economic ideas, and the right’s ideas
failed.

But the zombie still shambles on. And here’s Mr. Rubio: “Every dollar our
government borrows is money that isn’t being invested to create jobs. And
the uncertainty created by the debt is one reason why
many businesses aren’t hiring.” Zombies 2, Reality 0.

In fairness to Mr. Rubio, what he’s saying isn’t any different from what
everyone else in his party is saying. But that, of course, is what’s so
scary.

For here we are, more than five years into the worst economic slump since
the Great Depression, and one of our two great political parties has seen
its economic doctrine crash and burn twice: first in the run-up to crisis,
then again in the aftermath. Yet that party has learned nothing; it
apparently believes that all will be well if it just keeps repeating the
old slogans, but louder.

It’s a disturbing picture, and one that bodes ill for our nation’s future.


-- 
Art Deco (Wayne A. Fox)
art.deco.studios at gmail.com
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/vision2020/attachments/20130215/01e954b7/attachment.html>


More information about the Vision2020 mailing list