“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.
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Joseph E. Stiglitz: Five Years in Economic Limbo
When the US investment bank Lehman Brothers collapsed in 2008, triggering the worst global financial crisis since the Great Depression, a broad consensus about what caused the crisis seemed to emerge. A bloated and dysfunctional financial system had misallocated capital and, rather than managing risk, had actually created it. Financial deregulation – together with easy money – had contributed to excessive risk-taking. Monetary policy would be relatively ineffective in reviving the economy, even if still-easier money might prevent the financial system’s total collapse. Thus, greater reliance on fiscal policy – increased government spending – would be necessary.
Five years later, while some are congratulating themselves on avoiding another depression, no one in Europe or the United States can claim that prosperity has returned. The European Union is just emerging from a double-dip (and in some countries a triple-dip) recession, and some member states are in depression. In many EU countries, GDP remains lower, or insignificantly above, pre-recession levels. Almost 27 million Europeans are unemployed.
Janet Tavakoli: President Obama Might Ask Who Benefits From U.S. Debt Default
Bloomberg News’ Yalman Onaran wrote an article on Monday about the disaster that would unfold if we don’t raise the debt ceiling and the U.S. has a technical default by missing an interest payment on U.S. Treasuries. James Kochan’s quote summed up my feelings: “Well, holy cripes!” It has never happened in modern history and would be a disaster greater than the September 2008 financial crisis.
China and Japan combined own $2.4 trillion in U.S. Treasuries, and they are understandably upset with the U.S. about the possibility of a technical default.
Most of the financial press has focused on how awful a technical default would be, and who is upset. But our leaders might ask a different question. Who are the reprobates that are cheering for the possibility of a technical default on the U.S.? Who stands to gain? Who might be happy to set off this financial bomb?
Journalists are understandably captivated by the government shutdown and the looming confrontation over the debt ceiling. Those are certainly dramatic stories. But another, quieter drama has been playing out for years in homes and communities across the country, as millions of jobs and trillions in wealth have been lost to Republican economic folly.
Now the Republicans are doing their best to make things even worse. Their budget stance offends many Americans’ sense of morality, since they’re asking poor and middle-class Americans to subsidize the luxuries of the wealthy and the profits of powerful corporations.
But in the end the country may reject their ideology for an even simpler reason: We can’t afford it anymore.
Mary Bottari: Dear WWII Vets, Forget About the Monument, They Are Gunning for Your Social Security
Apparently the only thing both Democrats and Republicans can agree on in Washington, DC, is that they can’t deal with bad press involving Honor Flight vets.
This led to absurd images of Republicans-who had shut down the federal government, including all monuments and museums-rushing to “aid” veterans shut out by monument closures. In the most revolting display, Rep. Randy Neugebauer (R-CA) publicly berated a National Park Service Ranger for a situation created entirely by Congress.
As the government shutdown marches on and the dangerously real deadline of the federal debt limit approaches, it is increasingly clear that the fight over “Obamacare” is merely an opening salvo. The real goal of the hostage takers is a “Grand Bargain” on the budget that would include cuts to Social Security and Medicare.
Richard Reich: Republican Crazy Talk About the Debt Ceiling
“I would dispel the rumor that is going around that you hear on every newscast, that if we don’t raise the debt ceiling, we will default on our debt,” says Sen.Tom Coburn, R-Okla. “We won’t. We’ll continue to pay our interest.”
This is crazy talk. While the Treasury Department could prioritize interest payments after October 17 — the day the Treasury Department says it no longer has legal authority to pay the nation’s debts — and not pay Social Security and Medicare, this would buy a few days at most.
Meanwhile, interest rates will soar, stock prices will plummet, the global economy will begin spiraling downward, and millions of Americans wouldn’t receive their Social Security and Medicare.
Gary Young: Ted Cruz, Obamacare circus performer
His pseudo-filibuster over defunding the ACA was doomed to fail, yet the Tea Party sees him as a lion. In truth, he’s a clown
Ted Cruz’s filibuster to prevent the implementation of Obamacare with the threat of shutting down the government has all the hallmarks of the “noble defeat” of southern Democrats from the mid-sixties onward. He is not so much opposing healthcare reform as protesting its inevitability.
Lest there be any confusion, I am not arguing Cruz is in any way a supporter of segregation or admirer of the late Wallace in his darker days. The comparison relates to his strategy, not his specific intent. It is in Cruz’s buffoonery, showmanship and tactical disingenuousness that he poses now as Wallace in drag.
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