Those who deny elections also deny the economy

The people who will lead the House of Representatives for the next two years, a group that is apparently not in it Kevin McCarthy, who seems destined to be president in name only – believes a number of false things.

Many, perhaps most, believe the 2020 election was stolenor at least that Joe Biden is somehow not the rightful president.

Many believe that COVID vaccines do more harm than good, a belief that has contributed to thousands of dead excess among Republican supporters.

Quite a few adhere to or are at least friends with the beliefs of the cult. QAnonwhich claims that the world is ruled by a vast conspiracy of pedophiles.

And almost everyone, again from what I can tell, believes that the US economy is in very bad shape, with the federal government at serious risk of bankruptcy.

You’ve probably read a lot about the political delusions of Republican extremists, and today the vast majority of House Republicans are either extremists or opportunists willing to go along with what the extremists want.

However, it’s important to realize that the economic views of Republicans are nearly the same separated from reality like his political fantasies.

Let’s talk first about the current state of the US economy.

Republicans have spent much of the last year yelling at a “Biden’s recessionAnd to be fair, many private analysts expect recent interest rate hikes to cause growth to slow and unemployment to rise this year, even as I hear more and more talk about the possibility of a “soft landing” which may break Sahm’s rule for recessions (a half-point rise in the unemployment rate), but won’t look like a major slump.

However one thing is certain:

There was no recession in 2022.

Indeed, the US economy ended the year with a strong rally continued growth of employment and an unemployment rate back to pre-COVID levels.

What about inflation?

The 2021-22 price hike, after decades of low inflation, was a major blow, and I don’t want to downplay either the magnitude or the extent to which many economists, myself included, didn’t see it coming.

Needless to say, Republicans have tried to make inflation, which they blamed on federal overspending, a central issue in the midterm elections.

But,they noticed that inflation has come down?

Has any prominent Republican ever acknowledged that the tide has turned?

The figures are truly astonishing.

For the year ending in November (latest data available), the consumer price index rose by 7.1%.

But inflation was only 4.8% annually over the past six months, 3.6% over the past three months and 1.2% in November.

It is true that inflation has been held back in part by events that are unlikely to be repeated, such as the collapse in gasoline prices in the second half of 2022.

On the other hand, there is good reason to believe that housing inflation – which accounts for around one third of the consumer price index – has declined sharply, but that this decline is still He doesn’t reflect in the official statistics.

Adding in the latest very encouraging wage data, a reasonable estimate is that we are back at full employment with core inflation only a point or two above pre-pandemic levels.

It’s not a perfect situation, and squeezing out residual inflation may (or may not!) be difficult, but it’s not a doomsday picture.

For what it’s worth, financial markets have essentially declared the inflation threat over:

They implicitly forecast 2% inflation as far as the eye can see.

They are also willing to buy federal debt at somewhat high but still low interest rates relative to historical levels, without showing any signs of concern about the creditworthiness of the United States.

However, Republicans are determined to see economic and fiscal disaster and, as always when Democrats occupy the White House, insist that we must take drastic measures to balance the budget.

That is, after we’ve dealt with your first priority:

deprive the Revenue Agency resources needed to go after wealthy tax evaders.

In any case, as usual, the GOP insists that the budget can and should be fully balanced by cutting spending.

And as usual, this insistence collides with the reality that such large spending cuts would be politically impossible.

Indeed, they would probably be politically impossible even if the Republicans succeeded in destroying democracy completely, which some of them seem to want.

Because the federal government is, as the old phrase goes, basically a insurance company with an army.

Aside from military spending — of which only a small fraction, even now, goes to defending democracy in Ukraine — federal dollars go mostly to the pension and health care programs on which tens of millions of Americans depend, including many Republicans.

So the new House majority is living in a fantasy world, insisting on a completely unworkable solution to a largely imaginary crisis.

Unfortunately, as we learned on January 6, 2021, political fantasies can have dire consequences in the real world.

c.2023 The New York Times Society