Wednesday, October 19, 2011

Crackpot Economics and the Republi-CON

As Will points out in yesterday's post, evidence contradicts the idea that regulation is responsible for unemployment. In addition, as Dean Baker has pointed out, evidence also contradicts the idea that "uncertainty" about the future federal budget and regulation, rather than lack of demand, is why businesses are not hiring. He points out that the hours worked by existing employees have not gone up. If the problem were uncertainty about the future, then we would expect hours to go up, but employers to hold back from hiring more people. But hours are still down. Hence the problem is lack of demand, as most economists say.

All this is further evidence that the Republicons are so addicted to a thoroughly refuted ideology—that deregulation and tax cutting and shrinking government will lead to a boom—that they are delusional. The most prominent evidence of this, though, is the respectful reception that Herman Cain's 9-9-9 plan had in the Republican debates. It was obviously a crackpot idea. The only one who said it would work were Cain and his "economist" who wasn't an economist. No others, liberal or conservative, were backing it.

The fact that Cain rose to number one in the polls among Republicans is the biggest evidence that the Republican electorate is out of touch with reality. The latest, most thorough analysis from the Tax Policy Center makes clear just how big a disaster Cain's plan would be, and how far it is from what he claims. 84% of Americans would pay more taxes, and the top income earners would pay massively less. So Cain's plan would strike a body blow against consumer demand, and in turn massively increase unemployment.

The Republi-CON is not only Cain, but all of them, including Romney. The success of the Democrats in 2012 is going to depend on their discrediting the whole Republi-CON, in the way that Cain is now discredited. Cain will now sink in the polls, I believe. If only Obama and other Democratic leaders would bring the argument to bear on the whole Republican con!

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