The debt ceiling crisis in the US really is quite extraordinary to behold. For decades, the US Congress has raised the debt ceiling as required. After all, the debt ceiling is just the natural consequence of a set of political tax and spend decisions, so in some sense it's odd that it even requires separate legislation. As recently as late last year, most reasonable observers thought there was no chance that Congress would vote against raising the debt ceiling.
But the US Republican Party no longer does reasonable. Following the Tea Party takeover, House Republicans have now now decided that they would prefer to trash America's credit rating (and thereby push up interest rates for millions of Americans) rather than accept any increase in taxes for high-income Americans.
The question is: how do mainstream commentators react when one party moves sharply to the extreme? As Paul Krugman's column and blog have recently noted, the overwhelming tendency among most political observers has been to maintain a standard he-said, she-said approach. So it's easy for the casual watcher to miss the big story: the US Republicans are fast abandoning any semblance of a market-driven party, and are now willing to do or say just about anything for political gain.
The contrast with parties like the UK Conservatives and New Zealand National Party is palpable. I don't agree with some of what those parties are doing, but at least it's possible to discern a clear ideological compass in their decisions, many of which continue to be pro-market (eg. both countries' adoption of emissions trading schemes).
As for Australia, it's now pretty clear where Tony Abbott takes his lead. Having abandoned his party's belief in using markets to deal with climate change, walked away from a set of fuel tax reforms first put in place by Peter Costello in 2003, and used any chance he gets to attack the scientific consensus over climate change, Abbott is firmly placing himself in the US Republican mould. The question is: will the Coalition's rejection of mainstream economics in favour of populist politics get written up for what it is? Or will commentators miss the critical shift (that one political party has taken a huge leap to the intransigent right) and focus instead on what Krugman describes as 'the centrist cop-out'?
But the US Republican Party no longer does reasonable. Following the Tea Party takeover, House Republicans have now now decided that they would prefer to trash America's credit rating (and thereby push up interest rates for millions of Americans) rather than accept any increase in taxes for high-income Americans.
The question is: how do mainstream commentators react when one party moves sharply to the extreme? As Paul Krugman's column and blog have recently noted, the overwhelming tendency among most political observers has been to maintain a standard he-said, she-said approach. So it's easy for the casual watcher to miss the big story: the US Republicans are fast abandoning any semblance of a market-driven party, and are now willing to do or say just about anything for political gain.
The contrast with parties like the UK Conservatives and New Zealand National Party is palpable. I don't agree with some of what those parties are doing, but at least it's possible to discern a clear ideological compass in their decisions, many of which continue to be pro-market (eg. both countries' adoption of emissions trading schemes).
As for Australia, it's now pretty clear where Tony Abbott takes his lead. Having abandoned his party's belief in using markets to deal with climate change, walked away from a set of fuel tax reforms first put in place by Peter Costello in 2003, and used any chance he gets to attack the scientific consensus over climate change, Abbott is firmly placing himself in the US Republican mould. The question is: will the Coalition's rejection of mainstream economics in favour of populist politics get written up for what it is? Or will commentators miss the critical shift (that one political party has taken a huge leap to the intransigent right) and focus instead on what Krugman describes as 'the centrist cop-out'?
Do you like this post?
Be the first to comment
Sign in with