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Matt Yglesias points to some new analysis by Center on Budget and Policy Priorities in light of the May jobs report. The basic point: "this is a very strange time to be focused on long-term budget issues."

Nearly two years after the economy technically turned the corner from recession to recovery, job growth was disappointing in May and unemployment remained high. At the same time, interest rates are very low (see chart), indicating that financial markets are far more concerned in the near term about a sluggish recovery than about deficits, debt, or inflation.

You wouldn’t know that from the current debate in Washington, which is focused largely on the size of budget cuts that must accompany legislation to raise the federal debt ceiling in order to secure the votes of enough members of Congress.

Interest rate/unemployment chart

Because they are all trapped in what Greg Sargent calls the Beltway Deficit Feedback Loop, in which the "relentless bipartisan focus on the deficit convinces voters to be worried about it, which in turn leads lawmakers to spend still more time talking about it and less time talking about the economy."

Of course, Democrats don't particularly want to have to talk about the economy right now, because it frankly sucks. But not doing so, not challenging the deficit-peacockery, does nothing to change the narrative that Republicans have set, with a significant assist from the Village's Very Serious People. In that world, the deficit is the only thing that matter, while in the real world, we need some jobs.

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Comment Preferences

  •  Capitol Hill must really be in a bubble. (20+ / 0-)

    Come here to Vegas some time and ask people about "the deficit". Go to the neighborhoods full of foreclosed homes. Go to the overcrowded schools. Go to the unemployment office. Go to the Social Security office. Go ahead and ask folks here how "concerned" they are about the deficit.

    Jeez, they just can't tell when reality bites them in the you-know-what...

  •  Unfortunately, it is a win (20+ / 0-)

    for Rs because budget cuts de-stimulate the economy, allowing them to blame Obama for bad jobs numbers.

    How did we end up here?  Many reasons, although the 2010 election is an immediate reason.  And the extension of tax cuts ensured higher deficits.  Many others.  

    CitizenX: "If the republicans were in charge GM & Chrysler would be dead and Osama bin Laden would be alive."

    by TomP on Mon Jun 06, 2011 at 12:48:44 PM PDT

  •  Where are the jobs, Speaker Boehner? (13+ / 0-)

    No freakin' kidding!

    Not ONE bloody thing this current house has pushed has a damned thing to do with creating jobs.

    War on Women, check.
    War on Civil Rights, check.
    War on Homos, check.
    War, check.
    Jobs...crickets.

    •  That should be the first question (7+ / 0-)

      out of every Democrat every time there is a microphone/camera/cell phone thrust in their direction.  Make sure every American knows that all spending bills need to originate in the House and none have been proposed, let alone passed by the GOP!

      I really need a new signature that is lofty enough for DK4 - but I just haven't eaten enough arugula and sipped enough lattes to come up with one today. Sorry folks!

      by RethinkEverything on Mon Jun 06, 2011 at 12:54:07 PM PDT

      [ Parent ]

      •  That's probably how Dems can win 2012. (3+ / 0-)
        Recommended by:
        jm214, createpeace, Brooke In Seattle

        If it's simply a referendum on the state of the economy (and there were candidates running on a platform of actually creating jobs), Dems would be in trouble all over the place. But because we instead face a morally bankrupt GOP campaigning to bankrupt the entire working class, Americans don't really have a choice. Can we afford any more Republican mistakes?

        •  If that was the case, Dems would have won in 2010 (1+ / 0-)
          Recommended by:
          happymisanthropy

          n/t

        •  Ha. Blame the republicans for a lack (1+ / 0-)
          Recommended by:
          RethinkEverything

          of progress on jobs . . . when we had a majority in both houses and a president elected by 10 million votes?

          I suppose that's emotionally appealing.

          That's understandable when I realize that I can't feel my body.

          by prodigal on Mon Jun 06, 2011 at 01:09:37 PM PDT

          [ Parent ]

          •  See my comment above. (1+ / 0-)
            Recommended by:
            prodigal

            What many Americans don't understand is that a President can't just snap one's finger and force one's agenda through. Congress works the way it does for a reason. Unfortunately, Republicans have used and abused procedure to block progress. And to make things worse, certain Democrats kept enabling them.

            Hopefully now that the GOP agenda is front & center, it will be harder for them to just run as the "Just Say NO! to the big, bad Democrats!" candidates.

            •  I appreciate your point and perspective (1+ / 0-)
              Recommended by:
              mightymouse

              but I don't agree entirely.  I don't believe a President "snap one's finger and force one's agenda through" (unless you are named George Bush apparently) but I do believe more could have been  . . . at least . . . attempted.  

              That's understandable when I realize that I can't feel my body.

              by prodigal on Mon Jun 06, 2011 at 01:21:53 PM PDT

              [ Parent ]

            •  I am starting to see (0+ / 0-)

              That some people lack the intellectual fortitude to understand what happened in 2009-2010 and why we are where we are.

              Deliberately ignoring Republican obstructionism in the Senate, and the Blue Dogs; I don't know what happened to the well-informed liberal but apparently he's been replaced by the "I barely think above the level of a freeper and only jerk my knee when my cult demands it!"

              Just in case you forgot today: REPUBLICANS VOTED TO END MEDICARE. AND THEY'LL DO IT AGAIN.

              by slippytoad on Mon Jun 06, 2011 at 01:25:40 PM PDT

              [ Parent ]

    •  but Nancy Pelosi's feet are held to the fire by (1+ / 0-)
      Recommended by:
      happymisanthropy

      moronic Bob Schieffer on Face the Nation, as if she's responsible for no jobs legislation being proposed in the House (let alone passed)

      "I'm sculpting now. Landscapes mostly." ~ Yogi Bear

      by eXtina on Mon Jun 06, 2011 at 01:13:12 PM PDT

      [ Parent ]

    •  This would be more effective if (2+ / 0-)

      President Obama demanded something from them to create jobs.  The contrast between what Obama is insisting on for job creation and the unwillingness of the House to act would become a core 2012 highlight film.

      The most violent element in society is ignorance.

      by Mr MadAsHell on Mon Jun 06, 2011 at 01:38:34 PM PDT

      [ Parent ]

      •  agreed (0+ / 0-)

        I'm certainly not implying there's no responsibility carried by the WH here.  I think there are significant ways he could push back...and should.

        For example...Obama should call them out on this during this whole freakin' MediScare and "debt reduction" hijacking and hostagetaking.  Where's the question like, "How does eliminating Medicare create jobs?"  "How many jobs are you planning to create with this "'budget"'?  

        It's just that Boehner talked about the "job killing Obamacare"...which they've dropped trying to repeal it face forward like a hot potato, but where are the jobs in the current hoax?

        Grr.

  •  Obama seems to want to re-run the Depression. (2+ / 0-)
    Recommended by:
    jm214, mightymouse

    Only this time, he wants to prove that the New Deal was misguided and that the Republicans were right. It's appalling.

    Everything the DFHs said when he appointed his economic team is proving to be true.

    Each time a person stands up for an ideal, or acts to improve the lot of others, or strikes out against injustice, he sends forth a tiny ripple of hope... --RFK

    by expatjourno on Mon Jun 06, 2011 at 12:57:49 PM PDT

  •  Austria (3+ / 0-)
    Recommended by:
    atdnext, chuckvw, jm214

    great at music, terrible at economics.  

    I think the issue is Paul Ryan is completly economically illiterate.  And those in the GOP who are express indifference because Ryan's economic illiteracy benefits them.  

    "This world demands the qualities of youth: not a time of life but a state of mind[.]" -- Robert F. Kennedy

    by Loge on Mon Jun 06, 2011 at 12:59:41 PM PDT

  •  We need to highlight that island of fiscal (6+ / 0-)

    sanity in the rough seas called Europe, which would be Germany, a nation doing just fine because they kept their people working rather than laying them off when the economy tanked.  Subsidizing a third to half a worker's pay and keeping him productive and consuming made more sense to the frugal Germans than laying off huge numbers of workers who'd need unemployment benefits and social services.
    Wave the flag of good sense here and with all the folks you know.  Germany did not go deficit nutz and have been in a position to help their neighbors.  And for those wingers who think helping one's neighbors is sojellistic, Sen. Coburn wanted helping one's neighbors to be the RW health reform program.  I can still recall all the RW head nodding and the clanking of cupcake pans being pulled from the cupboards to start that bakesale to help a neighbor who needs 100K of surgery and chemo.

  •  Correction: deficits only matter when Dem in WH (2+ / 0-)

    They seldomly made a peep about it when Bush was in charge.

  •  The election is going to turn on jobs (3+ / 0-)
    Recommended by:
    Meteor Blades, atdnext, psyched

    There has been a lot of discussion about what the unemployment number has to be for Obama to be reelected. I think it's not necessarily the unemployment number, but the real world - is there someone in your family who is out of work, did your kid find a job when he just graduated from college? That's harder to quantify than a number. Some of the unemployed may have dropped off the official unemployment numbers, but they are still here,and their families are still suffering and they might still vote but not for an incumbent who doesn't seem to be acknowledging their existence.  

  •  "Of course, Democrats don't particularly... (7+ / 0-)

    ... want to have to talk about the economy right now, because it frankly sucks. But not doing so, not challenging the deficit-peacockery, does nothing to change the narrative that Republicans have set, with a significant assist from the Village's Very Serious People."

    Exactly.

    As I noted last night:

    ...the politically invisible are supposed to have a champion in Washington. That champion, the elected Democrats, who are worried about votes in 2012 if the economy is still only anemically "recovering," ought to be taking every single opportunity there is to speak and act for those invisibles. Every day. And they ought to realize that more and more Americans have become, are becoming, invisible. Middle-class Americans.

    This doesn't mean the gains achieved in the past couple of years should go unmentioned. President Obama was on the mark in his speech in Toledo last week in this regard. But it also means Democrats should not sugarcoat the very real problems faced by 25- to 30-million unemployed and underemployed Americans. They should speak for and about them boldly. Take responsibility for them. And point fingers. Otherwise, the fingers will inevitably, justifiably, point at them.

    They should absolutely take note that the economic situation in January 2009 was a disaster inherited by the new administration. It was an acute disaster that can be laid mostly at the feet of the Bush administration, and a chronic one with its roots in voodoo economic theories and policies embraced over several decades. Every public chance they get, Democrats should point out the obstacles to fixing this acute and chronic economic disaster.

    Not just the obvious obstacles on the floor of the Senate and House, the stubborn extremists who now run the Republican Party. But far more crucially, they need to inform the nation of the obstacles put up by plutocrats who have constrained regulatory agencies and concentrated the media into a tight little cabal committed to the distribution of baloney and bullshit. They should not pretend that if they don't mention this reality it will go away.

    Some Democrats are already on the case. And huzzah to them for not having to have this stuff coaxed out of them by Rachel Maddow and a handful of other reliable people in the media. But more Democrats need to stand up. They should be making the plight of invisible Americans visible. Every day. They want to win elections? That is the way to do it.

    Don't tell me what you believe. Tell me what you do and I'll tell you what you believe.

    by Meteor Blades on Mon Jun 06, 2011 at 01:09:14 PM PDT

  •  When it comes to Deficit-Peacockery there are (8+ / 0-)

    many Democrats who will not take a back seat to Republicans.  Conrad, Warner, McCaskill, Durbin and many others have bought into the Village meme that the budget deficit is our biggest problem.  It is not true of course, but it is the perceived wisdom on the Hill, at the WH and in the media.  Our leaders are no different than climate change deniers when it comes to economics.  They have rejected 60 plus years of settled economic truth.

    Suppose you were an idiot. And suppose you were a Republican. But I repeat myself. Harry Truman

    by ratcityreprobate on Mon Jun 06, 2011 at 01:11:01 PM PDT

  •  Politicians Only Have 2 Tasks: (2+ / 0-)
    Recommended by:
    happymisanthropy, Matt Z

    Performance and motivation.

    Democrats can't perform before the election because we lost the House.

    That leaves them nothing but motivation to prepare for 2012.

    Image Hosted by ImageShack.us

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Mon Jun 06, 2011 at 01:12:20 PM PDT

  •  it's an even stranger time to be unemployed (3+ / 0-)

    Nightmarish, to be exact.

    If a politician found he had cannibals among his constituents, he would promise them missionaries for dinner. H. L. Mencken

    by Keith930 on Mon Jun 06, 2011 at 01:16:23 PM PDT

  •  Interesting (horrible) cycle we have going (1+ / 0-)
    Recommended by:
    happymisanthropy

    The dems don't want to focus on the economy because it makes them look poor and could cost them seats in 2012.  This is understandable in a save your neck kind of way.  Usually, when this happens, the other party (the Republicans in this instance) jumps all over the party in power to garner votes.  Both sides make some big showy push to "save American jobs," a plan is hatched, and the issue is addressed (perhaps not adequately, but addressed nonetheless).

    Right now the Dems don't want to focus on the economy (saving their neck), but this time there is no credible opposition party forcing them to do so.  Since the Republicans could care less about 9% unemployment, even as a campaign tool, they push economic solutions that won't fix the problem.  Because of this the Dems have even less incentive to get voters to focus on the economy and jobs.   Thus the cycle of ignoring jobs for regular people is complete.   9% unemployment simply doesn't matter.

    The end result is working people are screwed because even those who can find jobs are squeezed due to an abundance of labor and little incentive from employers to offer raises and benefits.  Work conditions deteriorate, pay stagnates, and our corporate fiefdoms laught all the way to the bank.  

  •  Wake - up time (0+ / 0-)

    Here is the problem.

    Even with record stimulus and record low interest rates the economy is not moving very much.

    Of course any one with half a brain would have realized this was going to happen (see my posts from 2 years ago for one). When you have a debt bubble collapse the recovery is NEVER easy. In fact there is NO easy way out.

    No matter what is done, until debt is worked off or written off, there can be no real recovery. Consumers have no room to borrow more (and rightly don't think it would be much of a good idea either), and companies are not going to hire if no one is buying things, even if they get tax incentives to do so.

    What is needed is a fundamental restructuring of the economy (akin to replacing a blown out engine in a car). That means among other things, a massive cut in military spending (no longer affordable to throw a trillion plus dollars away every year), and higher gas prices (1/2 of the trade deficit is due to oil, so that is $1 billion a DAY leaving the country to pay for oil that is mostly wasted by fuel inefficient vehicles.) There are a lot more ideas too ... but that's the idea.

    Real change is required, not just waiting for things to get better or throwing money at people.

    "I can live with doubt and uncertainty and not knowing. I think it's much more interesting to live not knowing than to have answers which might be wrong". Feynman

    by taonow on Mon Jun 06, 2011 at 01:20:18 PM PDT

  •  A huge warning for Democrats everywhere: (2+ / 0-)
    Recommended by:
    Brooke In Seattle, mightymouse

    The auterity pimps not only don't give a damn if a single Democrat is re-elected anywhere in the country, but the vast majority of them would consider massive Democratic losses to be a happy bonus of their cause.

    I cannot comprehend anyone outside of Movement Conservatism being unclear on anything in American politics right now.

    Pay attention to NY-26, and tell people like Fareed Zakaria to go fuck themselves.

    Look at the inside the beltway reaction to the NY-26 race. Ohhhhh, noooo. This is terrible. What a setback to "reigning in" x, y, and z.

    The message is this: Democrats are supposed to kill Medicare primarily so the GOP doesn't get blamed for their own policy. It was the same logic underpinning the Village and beltway demands on Social Security in 2005.

    Real world politics don't get any clearer than the results in NY-26. Or back in Madison Wisconsin when Scott Walker tried to push his radical RW agenda on the Badger state. Or with Rick Scott in Florida. Or with Kasich in Ohio.  

    "Defend everything you exist to defend tooth and nail, and you can win."

    The bubble's reaction:

    Pretty much 'it would be a shame if the Democrats actually used this NY-26 election to defend Medicare, it's outrageous for them to accurately point out that the GOP is trying to destroy the social safety net, and Democrats should do the brave thing.... slit their own political throats to please those who have worked hard all of their political lives to marginalize and destroy their party and everything it supposedly stands for'.

    Have you ever heard from any of the austerity pimps when Dick Cheney said "Deficits don't matter"? Nope. Do you hear that Paul Ryan's plan ads Trillions to the debt they fetishize? Nope.

    The same people in punditry and in office who demanded that Democrats in Congress and Barack Obama shift gears from stimulus and focus exclusively on the deficit will be saying he must be removed from office, and the GOP should run both the House and the Senate, because of the bad economy, massive unemployment, and the suffering of the middle class that they don't give a shit about.

    This year and next is test for every member of the Democratic Party: Do you want back, or do you want a Darwin Award?

    Don't look now, but while the beltway crowd is screeching and screeching about Greece, the austerity pimps who can compare Greece and the United States with a straight face actually getting their way with Greece has only made things worse, not better.

    •  I have this theory (0+ / 0-)

      that the whole point of the last year in beltway politics is to create a mess big enough so that even the most unelectable Republican, even a Sarah Palin, could be seen as a viable candidate to be elected President.

      And to do it for the beltway's sick entertainment.

  •  The Problem: Democrats are Fiscal Conservatives (1+ / 0-)
    Recommended by:
    wsexson

    And unlike the GOP, they really believe in balancing budgets.

    This may be a less dishonorable position than the GOP's kleptocratic attempt to kill government off (other than defense and other forms of corporate welfare and some "social" legislation) through phony appeals to budget balancing, but it's bad economics and from the point of view of most Americans its ruinous.

    Don't get me wrong: I'd love it if Eisenhower Republicans took over the GOP again.  It would be great if the worst-case electoral scenario weren't quite so bad as it is today.

    The problem, however, is they've controlled the Democratic Party for the last two decades.

  •  Obama & Dems need to develop a jobs bill. (4+ / 0-)

    I know they won't be able to implement it, but they STILL need to develop it and get it in front of people -- if for no other reason, to stop the "Dems don't have a plan" BS.

    We need a jobs bill that addresses the needs of the long-term unemployed who have just been left hanging out here, or told to to back to school -- impossible without the money, wasteful if you already have multiple degrees as many of us do, worthless if there aren't going to be jobs at the end of the education period.

    In short, we need a (gasp!) industrial policy in this country.

    We also need to address the BLATANT age discrimination going on here. They might as well hang out a sign that says "Help Wanted: Nobody Over 50 Need Apply."

    Of course, that brings up the elephant in the room nobody wants to talk about: the health insurance reform bill still allows astronomical premiums by age, and doesn't cover those without jobs or money to buy insurance and pay co-pays, while the Medicaid system that we are supposed to rely on if we are poor is being dismantled alongside the Medicare program, and not enough people have made the connection. The much-talked about Dem report on how many people will be affected by the Medicare changes do not mention at all the Medicaid portion of the Ryan plan and the economic and health damage it will do.

    Of course, decent jobs at living wages would go a long way toward solving many of the problems we have funding these programs and Social Security.

    "The difference between the right word and the almost-right word is like the difference between lightning and the lightning bug." -- Mark Twain

    by Brooke In Seattle on Mon Jun 06, 2011 at 01:21:32 PM PDT

  •  Ultimately, Obama has endorsed the deficit (2+ / 0-)
    Recommended by:
    ratcityreprobate, mightymouse

    peacockery.  He has not owned the narrative - and is only not suffering politically because the other party is being owned by crazy people.  

    On the other hand, it is this very out of touchness that has kept the tea party alive (yes, there are other systemic forces, like the media, but ...).  There is a collective lack of will to solve unemployment - or to even think that unemployment is a condition worth fighting.  As Jared Bernstein has pointed out, we cannot even go through the idea that the WH is being held back by meanies - the advisors really don't believe that this is a demand problem.  

  •  This isn't tough. (0+ / 0-)

    It isn't a Beltway bubble.  It's bipartisan Class War.  The difference between the Dems and the Repubs is that the Dems are the battleground for the Class War and the Repubs are the vanguard for the Koch Brothers.

    But 1.5 of the two major Parties is fully in the tank for the wealthy, including the current Administration.

    The two things Teabaggers hate most are: being called racists; and black people.

    by Punditus Maximus on Mon Jun 06, 2011 at 02:24:23 PM PDT

    •  Ah...just rhetoric gone wild (0+ / 0-)

      George Soros...okay with you?  Anything like the Koch Brothers at all to you?

      C'mon, man.  Let's get past this divide you and your kind...and similar republicans are driving between us in our country.

      Let's try to get something actually accomplished without all the political bullshit.

      Thanks.

      -- **Nothing sucks more than that moment during an argument when you realize you're wrong.**

      by r2did2 on Mon Jun 06, 2011 at 04:15:30 PM PDT

      [ Parent ]

  •  Surely the Democrats understand (0+ / 0-)

    I certainly hope I'm stating the obvious, but I hope no one in the Democratic party believes that the Republican party has any interest in doing anything that will improve the economy.  Especially, before 2012.  The Democrats in Congress better keep that in mind as they negotiate on the debt ceiling and next year's budget.

  •  Both Dems & Reps Love to Talk Deficit Reduction (0+ / 0-)

    because each can then promote their political agendas.  Deficit reduction is simply a vehicle that everyone can ride to cut any program they don't like and raise taxes on their opponents.

    It's a fun game and everyone gets to play!

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