Congressional Kooks

We get the kind of government we deserve. Not always the kind we want or need.

It ain't that hard, folks. Listen up.

Shake enough hands with enough people and anybody can get elected to anything.

   The level of perception and the quality of questions raised by members of Congress is often astonishing for their lack of depth. Those who ask simplistic questions and demand simplistic answers don't deserve to hold positions of complex responsibility.

   Recently, a member of Congress wanted to know which is better for reviving the economy, federal investment or deficit and debt reduction. The Radical Right, led by Tea Partiers, insist on the simplistic answer of less spending and more saving. Missing from that line of thought is the reality that money flow is the lifeblood of any economy. And a simple response is this: Cut off the flow and the patient dies. 
   As for the question of which is better, the answer is: Both are important, and each is a useful method in either short-term or long-term planning.
   As  Doug Elmendorf, the chief of the Congressional Budget Office explained in a CBO blog posting this week, "Both sound federal investment and reductions in federal deficits and debt can boost economic growth in the long term." In the short term, however, "reducing federal deficits and debt would tend to lower economic growth, whereas increasing federal investment would tend to raise it."
   This is Economics 101: When the economy is in trouble and the private sector is not spending, the government should step in, investing in projects that will benefit the nation. Going into debt is less important. Then, as the economy improves, government spending can be reduced and more money set aside to trim deficits and debts.
   As Elmendorf put it, "decreased federal spending or raised taxes (and thus decreased federal deficits) would generally reduce demand." If people have less money and must pay more in taxes, they spend less. And in spending less, the entire economy suffers. That, in effect, is a recession. Production drops to match a dip in spending. And so it goes, ever downward.
   The solution, then, is for government to prime the economic pump. Later, as the economy recovers, government can -- and should -- cut back and then deal with deficits and debts.
   The critical issue, however, is timing. How much and when should government intervention retreat.
   The arch-conservative insistence that there be no government intervention of any kind, under any circumstance, ever, can only lead to a wildly cyclical economy.
   That way madness lies.