In Paul Krugman's column this morning, it becomes clear that no matter how good the information is out there it will always be muddled by the people with the megaphone --whether they're politicians or "pundits" or the media, and whether intentionally or not.
The problem we're doing nothing about consists of pundits, media, and pols -- and ourselves. The deficit is a great example. As pretty much any economist will tell us, our personal deficits bear no relation to America's deficit. The "kitchen table" economics politicians often refer to are nothing like America's economics. What government can and does do with respect to debt is quite different from what we are able to do as individuals with our own debts. Hard to explain, but true. Just keep in mind that if someone tries to pull that "kitchen table" on you, they're out to blind you to reality for their own reasons.
And here's something else we need to internalize, starting today. The Republicans -- more widely, our "deficit hawks" -- are likely to plunge us back into a deep recession*, maybe even want to plunge us back into a deep recession. "Fiscal cliff" is an invention except in the sense that the Republican party would love to push us off a cliff and may succeed.
... It’s true that we face a time-sensitive issue in the form of the fiscal cliff: unless a deal is reached, we will soon experience a combination of tax increases and spending cuts that might push the nation back into recession. But that prospect doesn’t reflect a failure to “fix the debt” by reducing the budget deficit — on the contrary, the danger is that we’ll cut the deficit too fast. ... Paul Krugman, NYT
Keep that in mind. Then move on to another reality: all this isn't just about being nice and finding a compromise. The impression given by the media (carefully concocted to deceive) is that "both sides are to blame for the stalemate." Nuh-uh.
... It’s true that elected politicians have been unable to “come together and compromise.” But saying that in generic form, and implying a symmetry between Republicans and Democrats, isn’t just misleading, it’s actively harmful.
The reality is that President Obama has made huge concessions. He has already cut spending sharply, and has now offered additional big spending cuts, including a cut in Social Security benefits, while signaling his willingness to retain many of the Bush tax cuts, even for people with very high incomes. Taken as a whole, the president’s proposals are arguably to the right of those made by Erskine Bowles and Alan Simpson, the co-chairmen of his deficit commission, in 2010.
In return, the Republicans have offered essentially nothing. Oh, they say they’re willing to increase revenue by closing loopholes — but they’ve refused to specify a single loophole they’re willing to close. So if there’s a breakdown in negotiations, the blame rests entirely with one side of the political divide. ...Krugman, NYT
If you still like watching fights, then keep an eye on the real fight going on behind the curtain, the one that's taking place within the Republican party. How that struggle shakes out could affect our futures a good deal more than the artificial bickering between party pundits and think-tankers on those Sunday morning news-and-interviews set-ups.
In the event no compromise is found, however, the Congressional Budget Office and many private economists warn that the sudden pullback in spending and the rise in taxes would push the economy into recession in the first half of the year. Under this outcome, Mr. Gault said, the economy could shrink by 0.5 percent over all of 2013.
With the clock ticking, some observers bolstered their criticism of Washington. “If we have a recession, it’s unforgivable,” said Bernard Baumohl, chief global economist at the Economic Outlook Group. “For the first time in modern history, we will have a self-inflicted recession in the U.S.”...Business Day, NYT
If your brain is in a tangle, you're feeling low, and you don't know who to believe, here is a very useful guide back to sanity... and self-esteem. Oh, and fill your glass with champagne and/or go visit the vineyards in Champagne.