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Can We Focus on Unemployment Now?
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Can We Focus on Unemployment Now?
This is a major problem, because austerity measures have the potential to throw the economy back into recession. As we learned during the Great Depression, cutting government spending in the midst of a downturn lowers aggregate demand and keeps businesses from expanding. This, in turn, depresses the economy and increases deficits in the long run.
If this were not enough, it appears that many of the proposed cuts will come from Medicaid and education aid to the states. Combined with the fact that the bill fails to extend unemployment insurance or provide other forms of assistance for the growing number of jobless Americans, the debt ceiling "solution" will harm the most vulnerable members of society. And who's to say we won't see similar stunts over the coming years? Watching Republicans use an obscure legislative procedure to extract radical policy concessions will likely lead to more economic hostage-taking in the future.
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