President Obama, realizing the economy is weak and many Americans need jobs, will be giving a speech on Thursday announcing his plans to create more jobs. The present-day Republicans — who are under the impression that their job is not to improve the country, but to make life difficult for Obama and reject everything he does –have already criticized his speech before he has given it. Reports are that Obama is seeking to spend $300 billion in federal money to improve American infrastructure such as roads and schools in order to create jobs. While the specific details of the speech are not yet known, that has not stopped Republicans from criticizing it: Jefferson Sessions, a Republican Senator from Alabama, said “At some point this county gets to a position where you cannot continue to borrow without damaging the economy,” and said the Republicans will oppose any plan to increase spending without additional spending cuts.
The current Republican ideology is completely illogical and flawed. They insist on reducing the government debt, so they demand cuts to spending, but refuse to raise taxes. If a person is in serious debt, common advice for that person would be to take another job to raise more revenue. When the government is in serious debt, and the Republicans demand to cut it, they refuse to raise more revenues through taxes. It is beyond irrational. The government needs to collect more revenue if it wants to reduce its deficit.
Beyond the government refusing to collect more revenue, they continue to demand more spending cuts and refuse any new government spending. The Republicans have no solution for the jobs problem except to further reduce corporate taxes! That’s honestly the Republicans’ solution to the jobs problem. Instead of raising taxes to offset the deficit problem, the Republicans want to reduce taxes to create jobs? As if the reduction of corporate taxes will inspire any corporations to hire any more employees; the goal of businesses is to make as much money as possible while spending as little as possible. They will not hire employees they do not need simply because of they are paying lower taxes.
The economy is stagnant: consumers are not spending because they are afraid for their jobs and lack of money, so this lack of consumption has diminished the demand for commodities, and the lack of demand has reduced the need for production, which thereby reduces the need for businesses to hire any more. It’s cyclical: as consumption reduces, so does the demand, and then so does production, which causes more reduction in jobs, returning to the starting place, where consumption is increasingly reduced, and the cycle repeats itself. This is the exact same cycle that took place during the Great Depression.
For the government to fix this economic problem, they need to spend publicly to create jobs. Businesses alone are not going to fix this — they are part of the problem. In an ideal world, we would not need government involvement to fix the economy, but — as I laid out in my last post –capitalism needs to be regulated because capitalists are only looking out for how to make the most money, which does not benefit the country as a whole. Yes, more government spending will increase the national debt in the short term, but it will create jobs, which will lead to more consumption, which will then increase demand, allowing businesses to increase production and hire more people, leading to more consumption, and raising more revenue for the government.
The problem with government spending is not from spending in public sectors. When the United States spends $700 billion every year on the military, occupies two foreign nations for close to a decade, spends billions every year on a failed War on Drugs, continually builds new prisons and imprisons millions of non-violent offenders,, and donates billions every year to disloyal allies, that is where the excessive spending comes from. Those do not create jobs. Spending money on schools, streets, libraries, museums, public transportation, etc. creates jobs, improves the economy, and improves our nation’s infrastructure and culture.
At some point, I expect some Republican to stand up and renounce what is happening in the current Party; in the past, I have often disagreed with them, but currently, it goes beyond that — they are simply irrational, and some Republican needs to stand up against it.