Fund the Damn Jobs: Deficit Fear-mongering Only Helps the Rich
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That leaves only one remaining source of demand -- government. We need a giant jobs program to hire people and put money in their pockets that they'll spend and thereby create more jobs. Put ideology aside and recognize this fact. If it makes you more comfortable call it the National Defense Jobs Act. Call it the WPA. Call it Chopped Liver. Whatever, we have to get the great army of the unemployed and underemployed working again.
Also: Put more money in consumer's wallets by eliminating payroll taxes on the first $20K of income (and make it up by applying payroll taxes to incomes over $250K.)
Also: Get more hiring by giving the states and locales interest-free loans -- so they can rehire all the teachers, fire fighters, police officers, and sanitation workers they've fired -- to be repaid when their state employment rates hit 5 percent or below.
Also: Get more credit by having the Fed return to "quantitative easing" -- expanding the money supply by purchasing mortgage-backed and other types of securities.
If we let the deficit hawks and government haters dominate this debate, as they have, the Big Dipper will continue for years. The Great Depression lasted twelve.
Robert B. Reich has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He also served on President Obama's transition advisory board. His latest book is Supercapitalism.