Europe’s current doldrums are a dire warning to this country against the federal government pursuing a policy of austerity at a time of continuing slow economic growth. It is also a vindication of a Democratic congress and President Obama in passing the 2009 stimulus bill that cushioned the American economy at a critical time when the economy was in free-fall.
In particular, America’s admittedly modest 2.2% economic growth in the first quarter stands in contrast to the United Kingdom’s slip into recession in the wake of debt-fighting austerity policies pursued by its Conservative government policies which are widely admired by Republicans in this country.
It is more than likely that our growth in employment in the US has been slowed by misguided and pernicious austerity policies by state and local authorities; and these would be replicated at the federal level if Mitt Romney and the GOP congressional leadership had their way. It never made sense to lay off hundreds of thousands of public employees including teachers, police and fire employees, thereby losing not only their vital services but the economic impact of their personal spending.
If there was anything wrong with the stimulus it lay in its relatively modest size given the magnitude of the crisis, and that too much of it was given over to tax cuts (in a vain attempt to attract GOP support) that gave far less bang for the buck than aid to states and local governments, and infrastructure spending. In an ideal world, we would have enacted a second stimulus to build on the first (with even more aid to states) but, without any GOP support whatever, that was a political impossibility. Indeed, Republicans in congress have behaved in ways that suggest they had no real interest in seeing the economy improve.
Slashing federal government spending now in a recovering economy as Romney and the GOP propose at a time when the immediate need is more short term spending to lower the unemployment rate is simply stupid. Unfortunately, that has never stopped the ideologically blinkered GOP.