Thursday, September 15, 2011

Catch of the Day

It goes to Alex Pareene, for an excellent takedown of a WSJ op-ed that complains about "blue state bailouts." I think Pareene is correct that this is a talking point we're going to hear plenty of in the future.

Of course, in the world of GOP rhetoric it's all about throwing benefits at Democratic-aligned interest groups, but for those who care about unemployment and economic growth, it just seems nuts to be me to laying off government workers left and right (and blue and red; as Pareene points out, it's not actually a "blue state" bailout at all. Regular readers know my view on this: finding a way to keep state and local governments from undermining anticyclical federal measures is a really big deal, and failure to have initiated a program to make such measures automatic, especially when they had the votes to pass it, is one of the big failures of the Obama Administration.

The problem, again, is that regardless of the long-term fiscal responsibility of state and local governments, they all have an inherent problem when revenues collapse and their responsibilities expand during recessions. Since states don't (exactly) run deficits, the only choices they have are to slash spending and/or raise taxes, in both cases at exactly the wrong time. Of course, if you believe on principle that in a recession it's good for government to maximize unemployment, you might not want automatic stabilizers...

At any rate, great catch!


  1. Sounds like the WSJ hit a nerve.

    These are bailouts, why call them anything but that?

    And the cash in question is going to public employees, union or otherwise, and that's a lefty special interest group, and kicks back to the Left.

    So it's a legitimate political attack. Bailouts for a favored group of political supporters, using borrowed Chinese cash?

    Sic 'em, wolfpack.

    Not to mention, smart states don't have as much need for the bailout cash, and they also have better bond ratings, so they can borrow cheap if needed. It's the profligate states that are in most trouble, and we know who they are, and why.

    Obama blew it. He passed out the Porkulus sugar, and once the sugar buzz wore off, the layoffs started at the state and local level, right in time for his reelection. And the suicidal package of Bailouts, Porkulus, Cap & Tax and ObamaCare were obviously destined to bring about the tsunami that would end his induced sugar jag, leaving him naked at the worst possible time. This has to be the dumbest exhibition of politics I've ever seen.

    This guy is just a political neophyte. He understands little, policy or politics.

  2. I just got around to reading the two pieces, and I was a little surprised that there is no 'takedown'. Pareene says the point is dumb, but he doesn't dispute its accuracy.


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