Robert Reich’s (Chancellor Professor of Public Policy at the University of California, Berkeley) op-ed on May 2, 2012 in the Marketplace Commentary section of American Public Media states:
“Europe’s austerity economics is plunging the continent into recession. But the U.S. isn’t far behind. Here, first-quarter growth slowed largely because of cuts in government spending.”
“And early next year, additional spending cuts go into effect along with a tax increase on the middle class. There’s no chance the U.S. economy will be fully mended by then, so the next president (whoever it is) is likely to find himself in an austerity-induced recession.”
“Austerity mavens in Europe and America are forgetting two big truths. First, the real goal isn’t simply to reduce the deficit –– it’s to lower the deficit as a percentage of GDP. Spurring growth is paramount. So cutting government spending when consumers and the private sector are holding back removes the last remaining source of demand. It makes things worse.”
“A large debt with faster growth is preferable to a smaller debt sitting atop no growth at all. And infinitely better than a smaller debt on top of a contracting economy.”
While government can lead the way out of the continuing economic depression, it is imperative that government policies and program stipulate and require that as a perquisite to being awarded government contracts and/or grants that the companies receiving the “investment” substantiate that they are significantly broadening the private, individual ownership of their companies as they use the monies to expand.
It is imperative that America puts itself on the path to prosperity, opportunity, and economic justice by connecting the majority of citizens, who have unsatisfied needs and wants, to newly invested productive capital assets enabling productive efficiency and economic growth.
http://www.marketplace.org/topics/economy/commentary/should-us-fear-austerity
