We’re finally clawing our way up from the bottom of the very deep hole that is the recession: Unemployment has dipped amid a "virtuous circle of rising incomes and improving finances." Yet House Republicans are pushing spending cuts that would send us right back down again, writes Paul Krugman for the New York Times. If passed, "hundreds of thousands of jobs" would be lost, something Republicans believe will be offset by improved business confidence. As Krugman likes to put it, "they believe that the Confidence Fairy will make everything all right."
But “since when does starving the IRS for funds help reduce the deficit?” What’s more, other countries’ austerity plans simply aren’t working. Just ask Britain, where business confidence “plunged” after austerity measures were announced. As Republicans try to “blackmail” the White House into agreeing to their cuts, they’re pushing a package that would “do double duty, both undermining America’s future and threatening to abort a nascent economic recovery.”