Shooting Yourself In The Head

To fix a broken arm. Thomas Walkom's column is a depressing read today. In it, he outlines how governments are going to use deficits as hammers to break their unions and cut their workers' pay and benefits. In other words, they are fighting the recession and its loss of economic demand from the private sector, by intentionally depressing the spending power of their own workers. If the economy is a drowning man, the governments are throwing it an anvil. Do you suppose a public sector worker, upon hearing his wages are going to be cut, is going to go out and buy a new car? Not on your life, he is going to hunker down and save. This will further depress the demand for cars and other goods and services and create a death spiral of more cuts in the private sector followed by calls for more cuts in the public sector.

I can see how pitting private and public sector workers at each other's throats makes good politics. Driving a wedge between the private and public sector working class keeps the focus off of the poor performance of the government and the ruling class (and has a side benefit of keeping people from thinking too much about bankers' bonuses and just how we got into this mess in the first place). But, gutting public sector wages, as an economic policy, during an economic downturn, it makes no sense at all.

Recommend this Post