Krugman: America Goes Dark
By PAUL KRUGMAN
August 8, 2010
The lights are going out all over America — literally. Colorado Springs has made headlines with its desperate attempt to save money by turning off a third of its streetlights, but similar things are either happening or being contemplated across the nation, from Philadelphia to Fresno. Meanwhile, a country that once amazed the world with its visionary investments in transportation, from the Erie Canal to the Interstate Highway System, is now in the process of unpaving itself: in a number of states, local governments are breaking up roads they can no longer afford to maintain, and returning them to gravel. And a nation that once prized education — that was among the first to provide basic schooling to all its children — is now cutting back. Teachers are being laid off; programs are being canceled; in Hawaii, the school year itself is being drastically shortened. And all signs point to even more cuts ahead. We’re told that we have no choice, that basic government functions — essential services that have been provided for generations — are no longer affordable. And it’s true that state and local governments, hit hard by the recession, are cash-strapped. But they wouldn’t be quite as cash-strapped if their politicians were willing to consider at least some tax increases. And the federal government, which can sell inflation-protected long-term bonds at an interest rate of only 1.04 percent, isn’t cash-strapped at all. It could and should be offering aid to local governments, to protect the future of our infrastructure and our children. But Washington is providing only a trickle of help, and even that grudgingly. We must place priority on reducing the deficit, say Republicans and “centrist” Democrats. And then, virtually in the next breath, they declare that we must preserve tax cuts for the very affluent, at a budget cost of $700 billion over the next decade. In effect, a large part of our political class is showing its priorities: given the choice between asking the richest 2 percent or so of Americans to go back to paying the tax rates they paid during the Clinton-era boom, or allowing the nation’s foundations to crumble — literally in the case of roads, figuratively in the case of education — they’re choosing the latter. It’s a disastrous choice in both the short run and the long run. …
aPaul,
What we are seeing are the consequences of human nature, taken to it's extreme. People like getting things for free, and abhor paying for them. Our political class has figured this out and has been over-promising benefits, and under-funding them for quite some time. The appearance of a 'free lunch' has been done with borrowed money. The people who have lending us the money are having doubts that we can ever pay it back, and so are lending us less.
The solution is to get a realistic handle on what we can afford to pay in taxes, and then shrink the government to fit within our means. The problem is that this means saying 'no' to someone, and politicians know this not the way to get re-elected.
Their solution is to monetize the debt and spend the money now and pay later through inflation. This cowardly approach works because most people think that inflation is somehow an act of God, not a direct result of monetary policy set by politicians.
Krugman states: "And it’s true that state and local governments, hit hard by the recession, are cash-strapped. But they wouldn’t be quite as cash-strapped if their politicians were willing to consider at least some tax increases.
Are you kidding me!, what a bafoon!
I live in a rural area of upstate NY where we already have nearly 6k per year STOLEN / EXTORTED from us because we own(sic)a house.
I see NOTHING for the taxes extorted through my home, we have NO kids in school,
have no available public utility's what so ever,
it's just plain robbery and he wants them to raise my taxes more!
We Already HAVE TO heat with firewood and are now canning food from the garden to make ends meet
What an A-hole!
I am sick of all the theft by this "free country"
How about YOU paying for the services that YOU want and use, stop steeling from me!