It would be hilarious if the world economy were not in such a delicate condition following three years of tepid stimulus efforts to counter the effects of the Great Recession, but now, at last, the Europeans are catching on.
This week, the central banks in those nations and others announced new, desperate-sounding efforts to ease lending rates and spur their sluggish economies.
The Washington Post reported Thursday, "Central banks around the world took major steps Thursday to stave off fears of global recession, with the European Central Bank slashing interest rates, China unexpectedly cutting bank lending rates and the Bank of England pumping billions of pounds into Britain's stimulus program."
Britain, led by a Conservative-dominated government, has been especially resistant to economic stimulation programs, and focused on budget slashing. This resulted in declining economic activity, leading -- naturally -- to declining tax revenue and a worsening economy.
And while the Europeans have dithered and wrangled over who should pay for what and who should enact which austerity measures, the United States has been hamstrung by congressional Republican radicalism, which has blocked even the modest stimulus plans put forth by the Obama administration. These include infrastructure spending, retention of police and teacher jobs, and automatic extensions of unemployment and job training benefits -- real budget busters there. Yet these affordable ideas are the type of priming the economy obviously still needs.
Only France, which recently ousted its conservative president and elected a Socialist government, seems to fully understand what is required in these situations. One decisive step in that country has been to enact new, higher taxes on the wealthy -- something Republicans have fought tooth and nail here, despite overwhelming evidence that the wealthy and large corporations have seen their tax burden fall and their share of the U.S. economic pie soar for the past four decades.
Meanwhile, the poor, the working class and most middle class Americans have been running in place, or slipping backward -- and their spending on goods and services, which keeps the economy humming, has stagnated or plummeted.
How many times does the world have to learn this simple lesson: Cutting back on government spending too drastically during an economic downturn only makes it worse. Do we have to have a double-dip recession before enough people in leadership positions understand -- or accept -- this concept?
Unfortunately, many in Washington, and in state capitals, seem religiously opposed to doing what actually works as opposed to what fits their political dogma. What got the world out of the Great Depression of the 1930s was massive, forced spending during World War II, which was caused in part by the harsh economic climate in Europe that proceeded it. But world war is not an acceptable stimulus. We should try more modest -- and more humane -- proposals while we have that option.