**Fiscal Discipline da 2
Econ Decline--Social Services Cut
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Econ Decline--Social Services CutIf deficits grow, it will result in the cancellation of social servicesCrotty, Ph.D., Carnegie-Mellon University, 12 (Crotty, James, “The great austerity war: what caused the US deficit crisis and who should pay to fix it?” Cambridge Journal of Economics, Volume 36, Pages 79-104 Accessed: 6-29-12) ADJ Third, rather than attack the root causes of the current deficit crisis—slow growth under the post-Reagan right-wing economic model, the radical deregulation of financial markets that contributed to the recent global financial crisis, endless regressive tax cuts and excessive defence spending on wars of choice—both Democrats and Republicans have insisted that substantial non-defence spending cuts must bear the brunt of deficit reduction. The Democrats offer large cuts in social spending, while the Republicans want to destroy the entire New Deal project.1 Both parties also propose regressive tax cuts that will increase deficits, thus ratcheting up the pressure for even more spending reductions. This increasing political pressure to destroy the foundations of the New Deal is paradoxical. The right-wing coalition is on the verge of succeeding in its 80-year quest to defeat the New Deal, not in spite of, but because it produced three decades of economic failure and exploding deficits. The worse the economy performs and the more the deficits grow, the greater the likelihood the coalition will achieve its ultimate goal Nuke war=ExtNo second chance after nuclear winter- Probability arguments irrelevant in the face of the magnitudeManson, Research Fellow at the University of Aberdeen, 1/30/07 (Neil, "The Precautionary Principle, the Catastrophe Argument, and Pascal's Wager", Journal of Scottish Philosophy, January 30, 2007, Accessed: 7/3/12) AHL There are real uncertainties involved in the nuclear winter predictions. They are based on models of poorly-understood processes. Many of the complex scientific problems will take many years to resolve and some of the key uncertainties will remain unless there is a nuclear war. Science cannot provide certainty on this issue. However, one doesn't require certainty to take decisions about risks. . . .With nuclear winter there would be no second chance. The potential costs are so enormous that it hardly matters for our argument whether the probability that the nuclear winter predictions are basically correct is 10 per cent, 50 per cent, or 90 per cent.. . [emphasis mine] The risk of a nuclear winter means that the present nuclear weapon arsenals are unacceptable. **AT:**AT: Plan Creates Jobs and StimulusTransportation Infrastructure won’t create jobs or stimulate the economy—it’s not self-sustaining Harding, Adjunct Professor at Santa Barbara City College-JD Hastings College of Law, 11 [Jeff, “The Hoax That Is The Infrastructure Bank,” The Daily Capitalist, Sept. 18, http://dailycapitalist.com/2011/09/18/the-hoax-that-is-the-infrastructure-bank/]bg Does anyone seriously believe that the reason we have high unemployment in America is because we have a substandard infrastructure? Apparently the politicians in Washington believe that is so because they are trying to make a case for massive infrastructure spending in order to “create jobs” and to “prepare our economy for the 21st Century.” I was watching that fountain of conventional wisdom, Fareed Zakaria tonight and he seems to buy into this proposition. He interviewed Senator Kay Baily Hutchison about her proposal for an infrastructure bank: The Kerry-Hutchison Bipartisan Infrastructure Bank also known as the BUILD Act. It won’t cost the taxpayers any money, she says, because it is a one-time $10 billion funding of this bank which will lend money for projects. As she says on her web site: The idea of a national infrastructure bank is an innovative way to leverage private-public partnerships and maximize private funding to address our water, transportation, and energy infrastructure needs. In our current fiscal situation, we must be creative in meeting the needs of our country and spurring economic development and job growth, while protecting taxpayers from new federal spending as much as possible. This is viewed as a “sensible and business-like approach” to solving this “problem.” When anyone does reporting on this topic you see shots of China’s high speed trains zooming along as well as Brazil’s new super port that will be “the road to China.” We don’t need any of these things because we have an excellent infrastructure despite what the “experts” say. Most of these experts want to cash in on this spending boondoggle. Let me be clear: not one new job will be created by this infrastructure bank. The truth is, we don’t need it. Our freeways, trucks, railroads, and aircraft do just fine getting around delivering people and goods. I’m not arguing that some things need repair, but that is minor compared to what this Infrastructure Bank envisions. As we all know, like all things run by government, they have let some of our bridges, roads, and schools go into disrepair because they manage it incompetently. While I am sure some kids go to run-down government schools, it’s not the buildings that are the problem, it’s the unions. I haven’t heard that our water supply is unsafe or that anyone has been poisoned by drinking out of the tap (spare me the occasional example, please). Our ports are fine despite the longshoremen’s union. We don’t need high speed trains because they are expensive and inefficient and people will fly instead. Please see Bob Poole’s work at the Reason Foundation if you need confirmation of this fact or on any matter dealing with public transportation. Here are some things to think about when the politicians spout this nonsense: 1. Jobs aren’t created by government. That is not to say that government employees or contractors do not work; they do. What it means is that government does not create wealth-creating jobs that are self-sustaining as would a private business. This should be fairly simple to understand. Taxes fund government operations. Only the private sector creates wealth that pay taxes. We can have an argument about whether or not government should provide much of the services that they do. For example, we know that private schools do a far better job at providing an education because they are not controlled by unions who control politicians. But, that is not the topic here. 2. Government spending known as fiscal stimulus, or Keynesian stimulus, as a cure for unemployment is another matter. The idea here is that since consumers aren’t spending all we need to do to revive the economy is to start spending somewhere in the economy and magically things will revive and take off. Unfortunately such stimulus never works to “jump start” the economy. It never has and never will. The American Recovery and Reinvestment Act of 2009 pushed $840 billion into the economy under this theory and it failed. No one (especially our politicians) asks where the money comes from to stimulate the economy. It comes from us, whether through taxes today or taxes tomorrow. And, the more you take out of the private economy, the less capital is available for businesses to create real jobs. Politicians never seem to see this. Right now the Keynesians are pushing on a string with this idea. Until we clean up all the excess houses, commercial real estate and related debt, no amount of spending or tax cuts will work. 3. Then there is the “quality” issue. Assuming that such infrastructure spending worked, the projects chosen are those favored by government politicians and bureaucrats and we know how well they do competing with the private sector. Need I mention the $535 million government loan guarantee to the soon to be bankrupt Solyndra? These folks shouldn’t be handing out your money; they don’t know what they are doing. As you can see, as with most of these Recovery Act contracts, it is just another way to pay for things the government needs or want. Nothing here will create real jobs, the kind that will be market-based taxpaying jobs. It’s a waste of your money. 4. Union workers will be employed for these construction projects since they are all federal contracts and that requires union workers. No big issue here; we all understand this is a payoff to the Democratic Party base. 5. Then there is Japan. They spent trillions on fiscal stimulus for much of the same things that are proposed by the Infrastructure Bank. It was all a huge waste of money there and the result was 20 years of sluggishness and the highest debt to GDP of any industrialized nation (225%; we are at 100%). Their economy is still in the doldrums and they stupidly push for even more such stimulus spending. We are going Japanese with all this spending but with a twist: we have inflation and we will have more inflation from quantitative easing and more spending. Keynesian defenses of deficit spending are antiquated the capacity of our economy means discipline is the vital internal to confidence and stable interest ratesSummers, Former Sec. of Treasury, 2000 [Lawrence H.,“THE CASE FOR FISCAL DISCIPLINE", May 3 2000 http://www.ustreas.gov/press/releases/ls605.htm] This Keynesian idea, that budget deficits could be used to stimulate demand in an economy producing well short of its capacity, still captures a very important truth about certain economies at certain times. It was surely the right prescription for the economy of the 1930s and, indeed, for Japan's economy of today. And it was the right response to the unused economic capacity in the U.S. economy of the late 1950s and early 1960s.Since my days as an undergraduate, however, experience has shaped our understanding of fiscal policy: First, we now place much greater emphasis on the importance of supply factors for long-term growth, and the danger that by crowding out investment, budget deficits can slow productivity growth and lead to a vicious cycle as higher public borrowing leads to higher interest rates, lower investment and economic growth, and still higher budget deficits. And we have come increasingly to appreciate that in an economy close to full capacity, excessive stimulus can increase inflationary pressures, raise risk premiums, and lead to higher interest rates. Second, financial markets have become more forward-looking, and more sensitive to changes in the outlook for fiscal policy. As a result, a change in the outlook for the budget is likely to provoke a more aggressive and immediate offsetting response from financial markets. This was powerfully demonstrated by the stimulative impact of deficit reduction in the 1990s, as increased investment demand resulting in a lower cost of capital more than outweighed any demand losses to the economy that resulted from lower government spending.It bears emphasis that these changes in understanding have not taken place in isolation. Globally, there has been a widespread recognition of the importance of fiscal discipline, the benefits of crowding in the private sector rather than crowding it out, and the important role that confidence can play in ensuring the long-term success of economic policies. The idea that fiscal discipline would help an economy expand by promoting confidence and crowding the private sector in rather than out, used to be considered theoretical. In that sense our fiscal policies in 1993 had an experimental element. Today the results of that experiment are in: the link between fiscal discipline and higher growth has been demonstrated. Directory: files files -> Answer True False 2 points Question 2 files -> Integer programming and game theory files -> 4 Integer Programming files -> Bpa vehicle Window Repair Scenario #1 task: Procure vehicle window relacement. Objective files -> Pop Warner History files -> North Carolina Inclusion Initiative Mapping Where Children with ieps are Being Served Purpose files -> Fall 2013 Spring 2014 Program Data: Standard 1 Exhibit 4d files -> Hanban – asia society confucius classrooms network 2010 request for proposal files -> Northern England’s set-jetting locations Download 0.63 Mb. Share with your friends:
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