Links

1.) Why "Business Needs Certainty" is Destructive - Yves Smith (Salon)

"You've doubtless [heard] the claim that the economy is a mess because of the threat to reregulate in the... wake of the financial crisis. This is propaganda that needs to be laughed out of the room...  "Uncertainty" as far as regulations are concerned is not a major [issue]. Surveys show that the "uncertainty" bandied about in the press really translates into "the economy stinks, I'm not a business that benefits from a bad economy, and I'm not going to take a chance when I have no idea when things might turn around."... [But] businesses have [also] had at least 25-to-30 years of near complete certainty--certainty that they will pay lower and lower taxes, that they will face less and less regulation, that they can outsource to their hearts' content... they have also been certain that unions will be weak to powerless, that states and municipalities will give them huge subsidies to relocate... that the financial markets will always look to short term earnings... that the SEC will never investigate anything more serious than insider trading... So this haranguing about certainty simply reveals how warped big commerce has become."

2.) Rick Perry Aggressively Pursued Federal Aid He Now Decries - Michael Scherer (Time)

"Rick Perry burnished his conservative credentials by attacking the idea of deficit stimulus spending... But, back in 2003, lobbyists under Perry's direction [lobbied]... Congress for more than a billion dollars in federal deficit spending on "stimulus". And they won. ...And that was just the beginning... the Texas lobbying campaign won funds for programs that Perry now says he opposes as fiscally irresponsible intrusions on state responsibilities."

3.) Why Cutting the Federal Deficit is a Bad Idea - Daniel Davies

The bad thing about cutting the federal deficit is not that [the cuts] might affect Social Security or Medicare... is not that some other virtuous program might be defunded... is not that it "shinks the state"... is not that it disproportionately falls on the poor... The bad thing about cutting the federal deficit is that unemployment is very high and interest rates are very low... borrowing money to employ currently unemployed resources is really obviously the right thing to do. 

4.) The Limitations of Romney's Unemployment Insurance Savings Accounts - Mike Konczal (Rortybomb)

"Mitt Romney argued for replacing our current unemployment insurance with a system of unemployment savings accounts... [a system] that would allow employees to create a savings account while working that has money automatically channeled into it tax-free to be drawn down during periods of unemployment. What are the differences between our current approach and the Romney approach?

First -- savings accounts don't involve... social insurance. There's no risk pooling or sharing risks along large populations in order to take advantage of the traditional benefits of insurance... Part of the point of social insurance is that it is social; we help others and they help us.

Second -- redistribution in the Romney [approach]... is upwards, towards the richest, instead of obviously towards those in need.

Third -- it weakens the power of the unemployed. Unemployment insurance increases the time until the unemployed take their next job... research tells us this is a "liquidity" effect as opposed to a work disincentive effect -- people are taking the time they need in order to find the best job for themselves instead of taking the quickest job in order to make basic payments... By empowering the unemployed and giving them more breathing space to search for the best job also enables them to search for the best wage to go with their job. Switching this system... throws off the balance between workers and bosses in favor of the latter.

Fourth -- it is hard to scale outwards in cases of emergency. In a recession it is very easy to extend unemployment benefits... savings accounts would be difficult to expand in any sense... it takes "automatic stabilizers" out of commission.

Fifth -- it removes the idea of the government from the equation of people dealing with economic risks... people will look at private savings accounts and think that the government isn't doing anything. Even if there are substantial tax benefits people will... ignore this.