Tags
Claire McCaskill, cobra benefits, deficits, Extenders bill of 2010, missouri, sort-term debt, unemployment
Today the tax extenders bill of 2010, which would have, among other important provisions, extended cobra subsidies and unemployment benefits for those hardest hit by the Bush recession, was defeated in the Senate 52-47. And Claire “I see Deficits” McCaskill was one of the 52 senators voting against the bill. She did this in spite of President Obama’s insistence that the spending is necessary “to boost the economy as signs grow of the recovery’s fragility.”
Why is this so terribly wrong? Ezra Klein puts it succinctly:
Unemployment is at 9.7 percent right now. It’s extraordinarily high. And it’s extraordinarily high because not enough jobs are being created to absorb all the workers who got laid off during the recession. Killing their unemployment benefits wouldn’t magically make more jobs appear. It would just make those people poorer, and because they’d be poorer, they’d have less to spend, and because unemployment is geographically concentrated, that would mean the economy in areas with lots of unemployed workers would tank further and thus it would take longer for it to create jobs.
Even a middle of the road economist like White House Economic Advisor Lawrence Summers understands that there is a difference between short term stimulus debt and long-term deficits:
He said the government’s stimulus measures helped revive economic growth …
“It would be an act of fiscal shortsightedness to break from the longstanding practice of extending these provisions at a moment when sustained economic recovery is so crucial to our medium-term fiscal prospects,” he said. …
Summers said much of that deficit will be reduced over the next five years as economic stimulus measures are phased out. ..
So what’s wrong with Claire McCaskill? Why can’t she understand the distinction between short-term and long term spending? And how can she do something that will hurt so many in Missouri where those who have been hit the hardest by the recession have already been raked over the coals by a state legislature that wants to balance the budget entirely on their backs?