You can tell from the topics of discussion among progressives what priorities they've set post-election. Progressives aren't looking back to address the lack of anti-war advocacy, and they aren't forming a resistance against violation of civil liberties, violations which Obama has probably increased, and they aren't scolding Obama for not following through with the closing of Gitmo, comprehensive immigration reform or breaking up the banks, just to name a few progressive demands on the list that was started in 2008.
No, the priority on the Left post-election is to use this strong message from the American people to raise taxes on the rich and spend more money on investment/stimulus. On Hayes' show he had an ex-Bain capital employee who defended the investor class on one side of the discussion, then he had four progressives counting himself, and more as the show went along, on the progressive side.
The defender of investors said that taxing the rich by the amount prosposed by Obama will bring in 50 billion dollars, then raising capital gains tax will bring in about 50 billion more, and that leaves 900 billion to close the deficit. A female economics professor from NY said that spending on such things as unemployment extension will create a multiplier effect, and when businesses see that government is going to support the unemployed, then businesses will start investing the trillion or so dollars they have sitting on the sidelines. A newly elected congress person from NY reiterated the stimilus argument, claiming that higher taxes under Bill Clinton brought about a booming economy. Hayes said he doubts that the deficit is a real problem and that he sees no reason why we can't continue to run a deficit since there is no inflation and none of the terrible economic consequences that are presaged by opponents to deficit spending.
There were other arguments on the show, like whether Big Money lost or won in the election. Although Hayes touched on it by asking if it matters that both sides spent a huge amount of money, the consensus from the progressive panelists was that the money donated to Democrats came from small donors who represent democracy, and the money donated to Republicans was from billionaires who seek to control the country by means of their wealth. There are conflicting reports, and when the fog lifts we'll know the numbers, but I imagine that Big Money did win -- it was on the Democrat side, and I seriously doubt there was much difference between Soros-type donations, union donations, and Democratic crony donations and the Big Money donations to Republicans from the Koch brothers and others -- Big Money won a Democratic victory, and the donors will be rewarded.
You would have to write a book to answer all the claims made by progressives on Haye's show, but several claims stand out. One is that extending unemployment benefits will work to give businesses confidence to invest in hiring and expansion. The money to pay for unemployment has to be taken from the private sector where it could be used more productively, and if we keep the current number of unemployed going with benefits, it will not add anything to what the market has alread factored in. If government went back and told all 12 million or so who are unemployed that they will receive indefinite unemployment benefits, the argument would be stronger, but not necessarily. Business people have been burnt by stimulus and promises that government can jumpstart economic recovery through investment in the economy. Business people are concerned about the financial health of the country and how much we owe, because the debt will have to push interest highers as the debt grows. The Fed is holding interest rates down artifically now, but the pressure will build. Even if there were a government-created bump in economic activity, as soon as all the money that has been pumped into the eocnomy starts circulating and heating up the economy, prices will rise, and this is a hidden tax. Higher prices and higher interests rates will send the country's economy back into a recession.
Because companies no longer trust government intervention to pump up the economy, there's no expansion or strong hiring. Companies have improved efficiency and productivity, and they're doing fairly well overseas, so they're waiting until they know what the rules and costs of doing business in American will become. Extending unemployment will add to the deficit and debt, but it will not create economic growth. Hayes likely says that the deficits don't matter because he and his friends, the people around him, are doing fine. About 20% of Americans who are capable of working and making a good living, are not doing so well. This 20% is either underemployed or unemployed. When Hayes says there is no inflation, he misrepresents inflation -- inflation is an increase in the supply of money. The Fed is pumping 30 billion dollars into the economy every month. What Hayes meant is that he doesn't see widespread price hikes, but price hikes are something different from inflation, although usually when we have inflation, an increase in the supply of money, we have widespread price hikes. We don't see the price hikes widespread at this point because we are experiencing stagflation, economic stagnation because businesses don't have confidence to hire and expand, and we have an increase in the supply of money, inflation.
However, Hayes is overlooking energy prices and food prices, both which have risen and are not counted in the price hike measurements. Everyone has to pay higher energy prices and higher food prices, so this is a hidden tax that is no longer discussed much in the media although higher energy and food costs hurt the poor, elderly and middle class in ways that don't much bother the likes of Hayes. So, yes, Hayes and his progressive colleagues have a different view. What's the problem they say? Oh, those 20%, well we're going to help them. When we give them crumbs...uh...welfare benefits, they will spend the benfits and magically the economy will grow and money will flow. Unemployment benefits are peanuts to people who need good jobs and a bright economic future. This idea on the Left that welfare will solve our spending and debt problems is ludicrous. We're spiralling out of control. The more people who need welfare payments, the more we go in debt and more money is spent by government that can't be spent or invested by the private sector. If the private sector felt confident that government will not intervene in economically destructive ways, and that congress will not go back over and over demanding higher taxes, as they'll have to do to pay for the huge deficit and expanding debt, then businesses would invest their money and hire.
The argument is whether the recovery will be generated by the private sector in a free market, or whether the recovery will be generated by government spending and interventionis in a statist system with progressive policies. The argument that Bush represented the private sector, free market side is flat wrong, and what we're seeing is just a continuation of statism under the blue flag, and the progressives are doubling down on the interventions and spending. We're headed for disaster.