There are two major pillars of Republican economic ideology.
First is "trickle down" economics -- the notion that if we allow the wealthiest two percent to accumulate more and more of the fruits of our economy, the benefits will "trickle down" to everyone else.
The second is fiscal austerity -- the idea that the best response to an economic downturn is to "tighten our belts" and slash critical government spending that we "no longer can afford."
Both of these pillars were created to justify the transfer of more and more income to the wealthy few and to provide a rationale for keeping their taxes as low as possible. But even recognizing the GOP's motivation in proposing them, ordinary voters might be tempted to support them if they actually produced economic growth and good-paying jobs for everyday Americans. They don't. And anyone who tries to make a case to the contrary must ignore the last century of economic history.
George Bush's great experiment in "trickle down" economics produced irrefutable evidence of failure in 2008 when the economy collapsed and all of those tax breaks for the wealthy had produced exactly zero net private sector jobs over almost an entire decade -- the worst job creation rate since the Great Depression. America has been recovering from that disaster ever since.
Now we have fresh evidence that the medicine of "austerity" is about as good at curing an economic downturn as arsenic is at curing a cold.
New numbers out this week showed the Gross Domestic Product actually shrank in the last quarter of 2012. It shrank despite the fact that consumer spending increased, businesses increased investment in new equipment and software, and the housing market continued to improve.
But those increases were offset by a major decline in federal spending, so the economy actually shrunk by .1 percent. Why did federal spending drop -- even before the so-called "fiscal cliff"? One reason appears to be that federal agencies held back on spending in anticipation of the potential "sequester."
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