Tuesday, April 02, 2013

Is the sequester a good thing?

The economy sucks, and it has been sucking for many years.

You can take it back as far as you want: say that the Clinton era of explosive growth an "irrational exuberance" was actually a bubble that began to collapse even before a victor was declared in the 2000 election. That George W. Bush's policy of getting rid of the surplus he had been burdened with by his predecessor put us on the path to collapse. Or that the September 11, 2001 attacks were a brilliant bit of asymmetric warfare which, for a very small investment of money and lives,* allowed a terrorist organization to provoke a series of predictable responses that resulted in global economic losses in the trillions of dollars.

For me it personally started to suck back in early 2007 when, after a series of contractions that had taken place over the course of years, I was finally squeezed right out of my lucrative position in the DVD industry. I spent the next six months searching for a job that paid anything close to what I had been making, until my old company finally contacted me and offered to take me back - as a production worker, making a little less than 2/3 of what I had been earning before. (Through the magic of overtime and at considerable personal expense I was able to bring in a decent paycheck from time to time.) That position lasted another three years - three years during which I kept my eyes peeled for anything better - until it went away in December 2010. In 2011 I was brought back again as a temporary employee (by a recently-hired personnel manager who would lose his own job just a few weeks after I met him), a job which lasted intermittently until in April of 2012 I finally accepted a full-time position in an entirely different industry - now making 40% of what I had been earning in 2007.

A few years ago a friend who works for the federal government in a place that could be discreetly described as "just outside the beltway" told me of a conversation she had come across between two fellow employees who were blithely discussing the prospects for the nation now that the recession was over** and the economy was improving. She pointed out to them that in places like Northeastern Pennsylvania the recession had not ended, that unemployment and the local economy were bad and were getting worse. And they looked at her like she was an idiot. Well, obviously they weren't concerning themselves with the peons in the sticks. For the people that counted, the recession was over, and things were looking great. The economy had winners and losers, and it's better to be a winner than a loser. You can't worry about the losers, baby.

Articles in magazines from around Washington, D.C. bore out this attitude. Employment in the region was great. Real estate sales and rental rates were as strong as ever, and prices were as high as ever. New restaurants and bars were opening all the time to separate federal employees, lobbyists, and the associated camp followers from their money. For those whose lives and jobs were entirely within the beltway bubble, the recession was over, and a new era of prosperity was at hand.

So has the sequester brought the hard times to Washington, D.C.? Maybe a little. I haven't heard much complaining from the privileged set down there, and I expect that they are as insulated from the sequester as they were from the other negative effects of the recession. It's not like any members of Congress or their staffs have been affected, and so it's likely that the bars and restaurants that they frequent are doing as well as ever. The pain is being felt by the lower-level employees of the federal government, but the professional bureaucracy is still doing just fine, thank you.

A few weeks ago a staunch opponent to gay marriage, Senator Robert Portman of Ohio, changed his position after discovering his son was gay. This news was given a generally cynical reception, as it was widely assumed that Portman only changed his mind because now he had a personal stake in the matter.*** But Portman's conversion suggests that perhaps the way to make members of Congress take a genuine interest in an issue is to bring the issue home to them. Since having their constituents suffer the effects of the continued economic downturn is clearly not enough to make them care about getting the economy back on track, perhaps having members of their own families lose their jobs, homes, and incomes will make the plight of the rest of the nation real for them?

Of course, if that happens, they will always be able to retreat to the insular bubble of Washington, D.C. to continue to focus on the winners, and continue to ignore the losers.

*That is to say, the nineteen terrorists who died on the planes that day.

**Technically, the recession ended several years ago. But as any economist who has the faintest idea what they're talking about knows, the effects are stll reverberating through the economy.

***Arizona Representative Matt Salmon has maintained his opposition to gay marriage despite having an openly gay son, suggesting a sort of integrity, or at least consistency.

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