Chris Matthews and Robert Reich Discuss ‘Republican Lies About Jobs’
Former Clinton labor secretary Robert Reich wrote a truly nonsensical piece for the Huffington Post Tuesday ironically called “The Republicans' Big Lies About Jobs.” MSNBC's Chris Matthews must have loved this tripe and its sophomoric title for he invited the Berkeley professor on Wednesday's “Hardball” so that the pair could put on a clinic in liberal economic fantasy (video follows with partial transcript and oodles of commentary): (BEGIN VIDEO) REPRESENTATIVE ERIC CANTOR (R-VIRGINIA): We have adopted a two-track approach called cut and grow. Now, the first part, cut, is obvious. We know that we have to stop spending money that we don't have, and we have to begin managing the money we do have and spend it more wisely. The American people are tightening their belts and Washington should too. The growth part is about those gazelles, growing businesses that add new employees every month, keeping regulators from running amok. (END VIDEO) CHRIS MATTHEWS, HOST: Welcome back to “Hardball.” That was House Majority Leader Eric Cantor Monday out at Stanford University. His speech on the economy prompted a reaction from former labor secretary Robert Reich in the Huffington Post. We all read it. Reich wrote about what he called, “Republicans’ Big Lies About Jobs.” Reich says there are five of them: deficit cuts somehow create jobs; tax cuts for the rich create jobs; corporate tax cuts create jobs; wage and benefit cuts create jobs; regulation killing creates jobs, and; regulations kill jobs. […] Robert, you say what we were taught in school. So, is there somebody teaching something else? I mean, if you want people to spend more money, you give them more money in wages or whatever, you don't fire them and leave them as paupers, because they're not very good consumers then. When you fire people, take away their rights to bargain for higher wages you take away their ability to spend their wages. So, what is this thing, this sort of religion course we’re getting, this primer we’re getting from Cantor? What is it, neo-classical from the 19th century? Where does he believe that stuff from? From here, Reich repeated some of the nonsense in his piece concerning how spending cuts would be the end of the world now, and President Obama needs to push back to prevent this from happening. However, what was stunning about this over eight minute segment was how Matthews and Reich admitted that the economy is in terrible shape right now, but implied it was somehow caused by spending cuts that haven’t happened yet. What they both totally ignored was the fact that spending has increased by 41 percent since 2007 while unemployment has risen from 4.4 percent to 8.9 percent while the country lost seven million jobs. Sound to you like this massive increase in spending over the past four years has done any good? But even better, towards the end of the segment (minute 7:16), Reich let a really inconvenient truth slip: “ This is the most anemic recovery we’ve had from a deep hole since the Great Depression .” Please notice that Matthews agreed, as of course do I. And that's the point, for we’ve increased federal spending by 41 percent without it resulting in much economic improvement. Yet Matthews, Reich, and their ilk believe cutting spending will hurt the economy. In reality, we now have two distinct economic periods in the past 80 years when huge increases in federal spending were made to try to pull the nation out of a “deep hole,” and neither has worked. Consider that from 1929 to 1939, federal outlays tripled from roughly $3 billion to $9 billion. Did it help? Hardly. The unemployment rate was 3.2 percent in 1929. Having peaked at roughly 25 percent in 1933, it was still at 17.2 percent at the end of 1939. Did a tripling in spending end the Depression? Certainly not, which means that massive federal spending has not solved the worst two economic crises of the last 80 years. But let’s take this a step further. The Left and their media minions always like to use the Clinton Era as an example of how raising taxes can actually spark economic growth. Of course, we conservatives know that the early ’90s recession ended in the 2nd quarter of 1991, and that the economy was already booming before the former governor of Arkansas was elected. We also know that the creation of the Pentium chip as well as internet routers sparked a technological and economic boom like nothing most baby boomers had ever seen. Ignoring all that, the 90s were also a period of fiscal restraint in Washington. On budget spending (meaning not including Social Security and Medicare) only grew by 42 percent. In the ’80s, this rose by 115 percent, which was actually down from 184 percent in the ’70s. Spending grew by 107 percent in the ‘60s. More recently, on-budget spending in the ’00s rose 117 percent. This means that if the Left and their media minions want to use the Clinton years as the blueprint for economic success, they should realize that government spending during that period increased at the slowest pace in the last five decades. Putting even a finer point on this, spending in the ’90s grew at less than 1/3 the rate of the average of the other four decades – meaning that the four decade mean growth was three times the ’90s. Add this to the failure of massive spending increases to get us out of the Depression and the most recent recession, and it’s clearly preposterous to claim that growth in government is at all economically stimulative. What was that Matthews and Reich were saying about big lies?
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Chris Matthews and Robert Reich Discuss ‘Republican Lies About Jobs’
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on March 23, 2011. Filed under