In earlier posts, I wrote about Woody Brock’s book American Gridlock – his characterization of the current political debate as a “dialogue of the deaf,” his thoughts on the deficit, and his solution to the entitlements problem. In my ongoing discussion of the book, which I urge you to read, I will look for stories that demonstrate one of the issues Brock raises: (1) the public economic crisis that threatens to make this a “lost decade;” (2) the entitlements crisis; (3) preventing perfect financial storms; (4) China and bargaining theory; and (5) distributive justice.
This morning’s news is dominated by the catastrophe hovering over Europe. This is hardly a new story, as we have been reading for months about the potential collapse of Greece, the recession in Spain, the Irish debt, Italy’s financial crisis, etc. While the doctrine of austerity may seem a rational intellectual solution to these problems in national treasury offices and newspaper editorial pages, it doesn’t work so well when people are injected into the equation.
Brock’s distinction between sound public investment in a nation’s infrastructure as opposed to deficit spending for short-term stimulation offers a way forward. A sound investment creates things we need – new bridges, better education systems, public transportation – and guarantees a return. It’s not easy to implement – “shovel ready,” for example, is not the right criterion – but it is the only way to get beyond the current impasse. It will put people to work building things we desperately need that will pay for themselves over time. And it will require people to work together, which is the antidote to the hardening economic and ethnic divisions that are Europe’s biggest threat.