Shh! Don’t Let On That The Freeloading 1%ers Are The Problem!

The exercise today for you, the reader, is to connect the dots between the following stories and bits of information:

– The real news (and the motivation for the otherwise-inexplicably-appropriate move by the usually-1%-loving French leader) is buried at the end of this Bloomberg article on Nicolas Sarkozy’s plan to charge a 0.1% tax on all French financial transactions:

Socialist candidate Francois Hollande leads in the French presidential election polls. He has the support of 31 percent of voters in the first round, 6 points more than Sarkozy, and his second-round lead has risen to 20 points at 60 percent, according to a CSA poll published last week. Hollande, too, has pledged to impose a tax on financial transactions, if he’s elected.

– Fred Hiatt once again whines that we must kick Grandma and Grandpa in the groins yet again and finish giving to the 1%ers the last remaining nickels from the pockets of what used to be America’s middle class, all in the name of “deficit reduction”. Dean Baker eviscerates him for us: “The House is on Fire and Fred Hiatt is Worried About What Color to Paint the Kitchen“.

– Prominent American Enterprise Institute wingnut-welfare recipient, Powerline darling, and 1%er apologist James Q. Wilson gets caught echoing Ayn Rand worshiper and idiotic 1%er apologist Paul Ryan’s lies about taxes and upward mobility; contrary to Wilson’s and Ryan’s shared spew, upward mobility is greater in the nations that actually tax their rich — such as most of Europe — than it is in America.

Oh, by the way, the Powerliner who waxed so wet-pantily over Wilson’s prose? None other than Steven Hayward, a typical hypocritical libertarian stand-on-your-own-two-feet kinda guy who has seldom if ever held a real job and who has depended most of his adult life on Claremont and AEI wingnut-welfare subsidies for his daily bread — subsidies that are themselves provided in part by the lumber firm Weyerhauser, which pays him to trash environmentalists.

Why Are “Deficit Hawks” Such Morons?

That’s the question posed, unwittingly, by deficit hawk knob-polisher and austerity joneser Matt Miller (courtesy of Dean Baker):

Miller apparently doesn’t know that China pegs its currency against the dollar. In order to keep the yuan from rising against the dollar, it has purchased over $1 trillion of U.S. assets over the last decade. The United States is in fact not “relying” on China to finance its current consumption. In fact, the official policy of both the Bush and Obama administrations was that we wanted China’s government to stop buying up dollars and thereby depressing the value of the yuan. [While this is the public policy, this may not be the actual policy, since many powerful interests like Wall Street banks and major retailers benefit from the over-valued dollar.]

This would allow the dollar to fall. That would make Chinese imports more expensive to U.S. consumers and U.S. exports cheaper for people in China. That would cause the U.S. trade deficit with China to fall, and possibly turn to a surplus, which is the textbook relationship between rich countries and poor countries.

In the case of Europe, the problem is that the German government and the European Central Bank (ECB) are trying to impose austerity across Europe. The ECB has all the euros it could possibly need to bail out Greece, Italy and anyone else in sight. However, rather than use its ability to print euros to save Europe’s economy, the ECB is trying to force cutbacks in social spending and protections for workers across Europe. The trip to China to seek support for a bailout was a silly diversion from the real issue.

And, just like the German austerity jonesers who don’t seem to mind that “punishing” the “sinner” nations is killing Germany’s economy as well, Miller — who like almost every other US economic writer allowed access to the pages of a major establishment newspaper, utterly failed to see, much less warn anyone about, the housing bubble of the 1990s and 2000s as it was bubbling (Krugman, as always, being the chief if not sole exception) — doesn’t see, or doesn’t care, that austerity will kill the American economy as well.