Robert Reich: The Next Crash

The left has some great economists that can sort out trends and make them understandable to the common person like you and I. For me the very best are Paul Krugman of the New York Times and Robert Reich.

Today we have a 4.5 minute video from Professor Reich explaining in very simple language why the next economic crash may be at hand. This video is about a month old, so it came before the announcement of employment cuts at General Motors:

 

One of the most important messages in that video was that to rebalance the inequalities government – especially in the Great Depression – moved money into the hands of the working class through several spending programs.

Keynesian economics simplified has governments raising taxes and cutting debt in good times and lowering taxes and raising debt in bad times. Works programs and aid programs help put money into the hands of the working class who will spend the money and create jobs. And yes, taxes in the good times would come from those with money.

If you are paying attention you know that recent Republican Administrations have done just the opposite – cut taxes during good times. By doing that they try to ensure that when the bad times come they can clim there is no money to fight the recession or depression. That is why when the Great (Republican ) recession of 2008 struck Republicans responded like a deer looking into the headlights.

Trump’s policies are even more skewed than George W. Bush’s. Therefore there is no preparation to respond to what Mr. Reich and others feel is a coming crash. Trump and his minions will use an economic downturn as an excuse to cut back on any kinds of safety net programs claiming the debt is so large (run up mostly by tax cuts for the rich and unnecessary wars) that we can no longer “afford” safety net programs. Such programs would include food stamps, TANF, Social Security, Medicare, Medicaid and pretty much anything that may help the common American.

Don’t say you haven’t been warned.

You may remember that in the last year of the Clinton presidency, plans were being made to pay off the debt by the year 2009. Questions also arose as to what kind of problems a lack of government debt may cause.

One very interesting approach to solve a couple of problems – the economy and climate change – has been proposed by congress member-elect Alexandria Ocasio-Cortez. Her proposal is a “Green New Deal” which would put American to work doing work that would help mitigate the coming climate change crisis. 

That is some serious proposal that really needs serious consideration.

About Dave Bradley

retired in West Liberty
This entry was posted in #trumpresistance, 2020 election campaign, Blog for Iowa, Economic Justice, Economy, Income inequality and tagged , , . Bookmark the permalink.

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