A win-win for GOP

You know the best way to shrink the deficit? Get people to work. When people have paychecks, they pay taxes. 

Yet, after weeks of hysteria in D.C. over the debt ceiling, the two political parties have done nothing that would actually get people back to work. 

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We’ve learned that Republicans are happy to endanger the U.S. and global economies in pursuit of their narrow ideological goals. We’ve learned that Democrats, trying to be the grown-ups in the room, will always cave to the GOP’s economic terrorism. 

We’ve also learned that neither party has any desire to do the things that will actually get people back to work — measures that would inject money into a moribund and backsliding economy. Instead, this new bipartisan embrace of austerity is virtually guaranteed to keep growth at bay.

“The central economic problem of the moment is the gap between what we could produce and what we are producing,” wrote Jared Bernstein, Vice President Biden’s former chief economic adviser. “It is not the budget deficit, the debt, nor is it the absence of either a balanced budget or a balanced-budget amendment. It is not too much spending nor too high taxes. It is the gap between how much the economy could produce and what it is producing … between the number of people who could work and who are working.”

Laura D’Andrea Tyson, chairwoman of the Council of Economic Advisers under Bill Clinton, echoes that theme.

“The jobs gap is primarily the result of the dramatic collapse in aggregate demand that began with the financial crisis of 2008,” she wrote. “Even with unprecedented amounts of monetary and fiscal stimulus, the recovery that began in June 2009 has remained anemic, because consumers, the major driver of private demand, have curbed their spending, increased their saving and started to deleverage and reduce their debt — and they still have a long way to go.”

The problem is clear. Yet only one party wants to do anything about it. Democrats believe that when you have a shortage of demand, government should step in and fill the gap with programs that put people to work and put money in their pockets. If people have money, they’ll spend it. And if people are spending money, businesses will invest and expand to meet that consumer demand.

For their part, Republicans have ditched any semblance of a coherent economic theory, and merely proclaim that destroying government creates jobs. How? Who cares? It just does! Ask them to point to a single instance in world history in which austerity brought a nation back from economic difficulties, and you hear crickets. Heck, ask Britain today, as it suffers through three straight quarters of zero growth, how its own austerity program is doing.

So now we’re left with a debate between people who can read economic data and those who can’t even be bothered to reconcile ideology with reality. 

Whether it’s slashing the ranks of public employees, putting strain on the nation’s employment picture or refusing to extend jobless benefits to the longtime unemployed, Republicans have already made significant headway with their efforts to impose their austerity doctrine on the nation. Too many Democrats, including almost the entire leadership in Washington, have adopted a “shared sacrifice” mantra when the middle class has already sacrificed too much at the expense of the moneyed elite.

The best part for Republicans? When their slash-and-burn austerity efforts further tank the economy, they can simply blame President Obama for it during next year’s elections. For the GOP, it’s a win-win.

Moulitsas is the publisher and founder of Daily Kos (dailykos.com).