Having just pushed the publish button on my previous post on the bankruptcy of Stockton and how one of the key problems facing local governments is the completely unsustainable compensation packages promised to many public employees I decided to reward myself with a quick perusal of the
They regurgitate Kruggers argument (see previous post here) that if local government had continued to hire at historical rates unemployment would be at 7%, Obama would be re-elected and all would be well in the world. The New York Times, obliquely recognizing most local governments are already bankrupt, propose that Congress provide fiscal aid to enable the aforementioned hiring.
O.K. Let me get this straight. The New York Times wants local governments, most of which are massively indebted and cannot afford the employees they have now, to hire more people (mainly at compensation levels unseen in the private sector) in order to boost local economies. Because no rationale lender would finance this idiocy they want the (also) massively indebted Federal Government to further burden the country by paying for this Keynesian boost to the economy.
It is unclear how long the New York Times wants congress to finance this hiring bonanaza but presumably not forever (although you never know with them) and then what? Local governments will still be massively in debt, continue to have cost structures that would bankrupt the vast majority of businesses in the private sector, and still be running significant deficits.
At some point we have to stop kicking the can down the road, stop adding to the national debt and take the tough medicine that inevitably follows years of irresponsible and profligate spending by politicians of all persuasions.