As I read Paul Krugman's op-ed The Texas Omen I couldn't help but think of the song "The Eyes of Texas are Upon You." Why? Well because our eyes should be on Texas. I also could not help but think of the Shakespeare saying from the play Julius Caesar "Beware the Ides of March."
We have now entered the era of austerity. Productivity has increased greatly and yet there is not enough to go around. The reason is simple, poor allocation of goods and resources. Austerity does nothing but aggravate the problem. To understand what is happening just look at Texas.
Wait — Texas? Wasn’t Texas supposed to be thriving even as the rest of America suffered? Didn’t its governor declare, during his re-election campaign, that "we have billions in surplus"? Yes, it was, and yes, he did. But reality has now intruded, in the form of a deficit expected to run as high as $25 billion over the next two years.
And that reality has implications for the nation as a whole. For Texas is where the modern conservative theory of budgeting — the belief that you should never raise taxes under any circumstances, that you can always balance the budget by cutting wasteful spending — has been implemented most completely. If the theory can’t make it there, it can’t make it anywhere.
The problem is caused by Republican lies and Republican policies. According to Paul Krugman
The truth is that the Texas state government has relied for years on smoke and mirrors to create the illusion of sound finances in the face of a serious "structural" budget deficit — that is, a deficit that persists even when the economy is doing well.
This sounds just like the smoke and mirrors President Bush used and Greenspan supported to get tax cuts for the wealthy through Congress. The result is a "structural" budget deficit. In the first round after the November election the US allowed the "structural" deficit to persist by keeping the tax cuts in place. I know parts of the "structural" deficit are due to a ridiculously massive defense budget that needs to be cut to about twenty percent of what it is now. We all know not only that those cuts not going to happen, but the defense budget will become even more massive.
Another part of the Republican mantra was spending cuts. People are dying in Arizona because of spending cuts. Feast your eyes on Texas to see what will happen.
Yet Mr. Perry wasn’t lying about those "tough conservative decisions": Texas has indeed taken a hard, you might say brutal, line toward its most vulnerable citizens. Among the states, Texas ranks near the bottom in education spending per pupil, while leading the nation in the percentage of residents without health insurance. It’s hard to imagine what will happen if the state tries to eliminate its huge deficit purely through further cuts.
To return to Julius Ceasar Et tu. Brute (Brutus) comes to mind. I say Et tu. Obama. The US is about to be held hostage again. In the near term there are two hostages. The first is the 2011 budget. A vote on what the 2011 budget comes due in February. Will we get a continuing budget resolution for a few more months? Will there be deep budget cuts? Will there be a return to the bill passed by the House in 2010 without the earmarks? Will there be a return to the bill passed by the House with the earmarks? Will a budget bill even be passed?
Sadly there is not much democrats can do with the House firmly in republican hands. This will be a showdown of monumental proportions ranking right up there with the tax cuts. Yes, the democrats will cave to prevent another government shutdown. Brutus has already signaled a willingness to accept budget cuts. I can already see secret negotiations where President Obama will take the blame for the cuts in services, just as he did for the tax cuts.
Shortly there after come the Ides of March. The debt limit must be raised. Again the country will be held hostage. One can, as Chris Hayes has, predict the Republicans are not serious or to put it another way are only joking. Either way Fox News and Republicans will yell about the debt ceiling and insist on spending cuts. If the debt ceiling is not raised until the last moment, I believe the symbolism will be so profound as to cause an economic calamity on top of the current economic calamity we are in. The cat food commission has already proposed cuts to social security, Medicare, and Medicaid. Yup, Brutus (Obama) is going to stab us through the heart and propose cuts to those programs. Maybe not for this year, but definitely over the long term.
My eyes are on Texas and the federal government. I hope I am wrong.