LATTE ECONOMICS

So while we're on the topic of Doug Hoffman, who appears to be on his way to victory in the NY-23 special election, let's familiarize ourselves with exactly what kind of genius we're dealing with here.

The economy still isn't great, right? I hope Doug has a plan to fix it. His website states:

Would you vote for higher taxes to help pay for the deficit?

President Ronald Reagan said it best: “The problem is not that people are taxed too little, the problem is that government spends too much.” Before we even consider raising taxes we must first bring spending under control.
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What spending would you cut?

I would cut the pork and wasteful earmarks.

Sure you would, cubby. Let's grab the knife and start slicing at something that amounts to 1% of the Federal budget. That'll straighten things out!

This fallacy has been rampant since the economy took a nosedive just over a year ago – the idea, applicable to micro- and macroeconomics, that all we need to do to right the ship is trim a little waste. For individuals who are struggling economically, the cure is simply to stop pampering themselves with unnecessary spending. In other words, stop buying that $3 latte every morning, stop seeing first-run movies on Fridays, and voila! The bank won't take your house after all.
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This same prescription is scaled up to the national level. If only we'd cut out our national latte – we call them "earmarks" or "pork" to obscure the fact that we have absolutely no goddamn clue what specific items should be excised – the budget would be balanced so fast our heads would spin.

In reality this makes no sense whatsoever. The problem with individuals in dire financial straits is not that they need to trim a little bit from the margins; it is that their fixed costs are too high.
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Real wages haven't gone up in 25 years and the paycheck barely covers the mortgage and car payment, so any shock, any unexpected expense, brings the house of cards crashing down. In the macroeconomic context our expenses aren't quite as "fixed" (unless we have to spend $341,000,000 per day in Iraq!) but the fundamental problem is the same. By the time we pay for Social Security, Medicare, Iraq, the standing military, interest on the national debt, and eight years of Bush tax cuts, we're already in the red. That coming in on the back end and taking the $1 million project to re-pave a highway in Congressman Smith's district will change that is idiotic.

This brand of economics is the conservative obsession with personal responsibility taken to the nth degree. We are weak, selfish, and we spend frivolously. If only we'd buckle down, pull ourselves up by the bootstraps, and limit ourselves to "necessary" expenditures we would be fine. Yes, we can cherry pick an example here or there of a person who blows all his money on plasma screen TVs and can't pay his mortgage just like we can find earmarks that are pure waste. Neither example is evidence that our problems as people and as a nation have to do with priorities. Our problems are systemic and deeply rooted. We are at a crisis point not because we are choosing between the mortgage and a mall shopping spree. Instead, we are choosing between the mortgage and college tuition, Medicare or the military. If only our choices were as simple as Doug Hoffman thinks they are. That sentence works just as well with a period after "Hoffman."

16 thoughts on “LATTE ECONOMICS”

  • Once, on Facebook, someone suggested to me in all seriousness that maybe people would be able to afford their insurance premiums if they would buy rice and beans in bulk, as this cost-effective eating strategy would enable them (I can only imagine) to devote the necessary 20% of their income to making sure Cigna's CFO gets one of those Land Rovers that gives him a blowjob when he turns on the windshield wipers.

  • I've always loved the movement to guilt the middle-classes into tightening belts and scrimping and saving, while encouraging the rich to have parties with phallic ice sculptures and thousand dollar wine. Blaming those who essentially have miniscule financial sway over the world economy is always a grand idea. Also a fan of the anti-union rants from friends blaming the autoworkers in Michigan for wanting those dental benefits in the past. They should have worked for peanuts and ceded the benefits so the big bosses could design more mult-million dollar fiascoes on wheels.

  • I'm also reminded of a news segment I saw late last year where a guy was saving a ton of money on food by recycling and repackaging. One example they showed was this dude saving up those maddening catsup packages from fast-food joints and squeezing them into an empty Heinz. He claimed this saved him a few bucks on ketchup a week or whatnot. It was personal responsibility and frugal behavior at its best, then you realize that this guy probably spent two hours squezzing watered-down ketchup into a bottle and it makes you wonder how bored this guy must be.

  • …"anti-union rants from friends blaming the autoworkers in Michigan for wanting those dental benefits in the past."

    Dental plan.
    Lisa needs braces.

  • Dude, your problem is that you fail to understand that in the "conservative" calculus, spending money to keep "undeserving" people from starving, dying of exposure, or dying from treatable medical problems is waste. Pretty much everything right-wingers say about economics is code for "niggers, spics, faggots, women, and jews stealing your white christian dude money".

  • Of course conservative leaders, their allies in big business, and the ignorant fools who go teabagging on a regular basis never mention the biggest money pits in the national budget- Iraq and Afghanistan. Comrade PhysioProf got it right- the only thing these fuckers want to give poor people is a bullet.

  • "one of those Land Rovers that gives him a blowjob when he turns on the windshield wipers." Where do I get one????

    Has anyone noticed that it's the "personal responsibility" types that are the first to complain about how slow the government is after some natural disaster like a tornado or flood??? Where's FEMA?? Where's the FEMA check to fix my place???????

  • The magic phrase “cut the pork” is to the Cons what “eat the rich” used to be to the Libs. If we slaughter one bank exec, we get to take away his Rolls and somehow redistribute his wealth so that every poor person in the world gets a bright, shiny penny. Hear that, kids? A penny!

    But part of the reason why this works on people is not just that they are as innumerate as they are illiterate: it’s because the only understanding we have of astronomically huge things is that they’re bigger versions of what we see around us every day. That’s how Superman can pick up a house without worrying about distribution of mass, that’s how God looks like my almighty Dad, that’s how the sun is like the fire in the grate (and please don’t mention the nuclear reaction; it just makes me confused and uncomfortable.)

    Credit card over-use and retail therapy have been around for decades, so you’d think we’d be very familiar with the difference between debt and deficit. Maybe we’ll learn now. But a lot won’t, because it’s easier to rally to the Cons’ battle cry than it is to do math.

  • …half in reply to last Friday's post: THIS is why I read ya – first thang every day. My little corner of wild west TX has great sunsets… but it's full of teabaggers, and if not for a ray of sanity coming from you each morning I'd have to wonder if the sun was gonna come up again on these mushrooms.

    To hear them tell it, micro is macro, and vice versa.

    A mind is a terrible thang….

  • 'Cutting pork' was also John McCain's universal answer to all economic woes last year, during the campaign. (Also: going back to typewriters; and bringing back the Model T to get Detroit out of its doldrums.) Eliminating 18 billions in earmarked spending was supposed to fix a deficit in the trillions.

    Of course, the liberal media never called him on his retarded bullshit. Nobody wants to lose their invitation to the barbecue parties at the ranch. Mmm, ribs!

  • Also: note how Doug confirms that invoking the name of Ronnius Maximus has become an acceptable substitute for sound arithmetic. They've reached the stage where theological correctness takes precedence over the basics of financial management. The conversion into a cult is now complete. Glenn Beck is their Jim Jones.

  • Let's revisit eating the rich. From Ed's link to his 10/15/08 post:

    FY 2008 Bush tax cuts to top 1% of income earners alone: $79.5 billion,

    Eight years of that = > $60 Billion in round numbers.

    The last 30 years have demonstrated a massive redistribution of wealth from the least well off to the most. The richest 400 families have been further enriched by over 1.5 billion each, during the Bush years. That's just about enough to pay for the original stimulus package. Poverty level citizens have seen their quality of life deteriorate at about 2%/Yr since at least the 80s.

    Yes, our wars are the big ticket items – Over the entire span of U.S history wars (including Reagan's phony star wars fantasy) have been the only significant contributors to the national debt. Wingers always talk about social programs breaking the bank. It has always been an absolute fucking lie.

    Cheers!
    JzB

  • @jazzbumpa: I agree wholeheartedly. My "eat the rich" days were about 25 years ago, when millionaires were a big wow, and not just workers who had a stock split and bought more Oracle. I now miss the French Revolution, and believe that if it weren't for television, there would be a guillotine in the square and guards outside the boardrooms. (Stay tuned for CSI: Opiate of the Masses.)

    Wars, their true costs and false booms, KBR, the constant drain of the defense budget even in peace — it's staggering. Yes, living on lentils instead of rice will save you two cents, but it's the Hummer payments that are killing us. Penny wise, pound foolish.

  • I was barely skating by last year with my paycheck. I had just enough to pay all the needs that needed to be paid. I thought that with my raise at the beginning of this year, I'd have more money to save and actually help avert unexpected money issues as they arose.

    Not so. I still find that I'm still barely skating by as utilities go up, etc. Ugh, it's so frustrating.

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