Austerity is beginning to hit and the economy is slowing as a result. The most immediate effect is that flights are delayed, but unemployment checks are smaller and there are fewer things We the People do to make our lives and economy better — also called “government spending.” But hey, as Dean Baker writes in, Deficits Are Bad and the Sun Goes Around the Earth,
…many people can profit from slow growth and high unemployment. The after-tax profit share of GDP is at its highest level more than 60 years. For those who own lots of stock and are at the top of the income ladder, times are good. These people may see efforts to lower unemployment as posing a risk. With lower unemployment workers may be able to get a larger share of productivity growth. This may be good for most of the country and mean increased economic growth, but it would mean less for the one percent.
Deficit Falling, Few Know
In February I posted Deficit Is Falling Dramatically, But Only 6% Know That,
There is no deficit problem. The deficit is down about 50 percent as a share of gross domestic product just since President Bush’s fiscal year 2009 deficit and is falling at the fastest rate since the end of World War II. Yet the Washington debate is about how and where to cut us back into recession. Why?
The post had a chart and some numbers… then,
Once again, because it might be hard to register due to the drumbeat of deficit-scare propaganda, this is a fact: the deficit is falling at the fastest rate since the end of World War II. It is down about 50 percent as a percent of GDP just since Bush’s huge $1.4 trillion fiscal 2009 deficit. And the deficit is projected to be stable for a decade.
… So let’s stop listening to the drumbeat of “deficit shock” propaganda and not be rushed into doing any more stupid, destructive cuts in the things We, the People do to make our lives better.
Finally the post linked to some polling news: only 6% of the public even knew that the deficit is down, most thought it is up, 94 percent of Americans don’t know the budget deficit is getting smaller. I got going about how our “news” media have to be actively misinforming us to get a number like that, only 6% of us even knowing the basic facts…
Big News — Deficit Falling Even Faster
So here’s the thing. It turns out that the deficit is falling even faster than that. Over at HuffPo Zach Carter writes up the story, in Goldman Sachs: Deficit Will Plunge Over Next 3 Years
After beginning the year expecting a $900 billion deficit for 2013, Goldman’s economic team, lead by Jan Hatzius, has now cut the figure twice, this time to $775 billion. By the close of 2014, the economists said, the deficit will decline to $600 billion, and clock in at $475 billion at the end of 2015. Goldman had previously expected a $650 billion deficit at the end of 2014 and $500 billion at the end of 2015. The improvements are due to stronger-than-anticipated tax collections coupled with lower-than-expected levels of government spending.
Of course, those “lower levels of government spending” are the reason the economy is slowing, but who’s counting? In a country where We the People make the decisions, “government spending” by definition is things We the People do to make our lives better. But who’s counting?
Here is a revised version of the chart from Deficit Is Falling Dramatically, But Only 6% Know That:
Note that the huge 2009 deficit was Bush’s last budget, not Obama’s first.