Washington Goes AWOL on the Economy

America is in the throes of a terrible economic and financial crisis. Yet in Washington, political leaders barely discuss the economy.

More bad economic news:

The FT:

In the average congressional district, serious mortgage delinquency rates – defined as borrowers more than three months behind on their payments – are 9.4 per cent, compared to 3.3 per cent at the time of the election in 2008, according to a study by Deutsche Bank.

Here's the thing that puzzles me: America is suffering in the throes of a terrible economic and financial crisis. Yet in Washington, political leaders barely discuss the economy. What we discuss is the federal budget: taxes, spending, deficits, debt.

The Democrats' plans to revive the economy have crashingly failed. The stimulus programs, the tax credit to encourage home buying (and thus maintain housing prices) ... no result. As John Makin nicely phrased it, "We do not have lift off."

Meanwhile the big idea on the Republican side is Rep. Paul Ryan's plan to reduce spending, hold the line on taxes, and balance the budget. That's like recommending diet and exercise to a patient bleeding to death.

Fiscal policy isn't economic policy. A plan to rescue the finances of the federal government is not a plan to rescue the finances of the American family. Reducing public debt will not help an economy crushed by the burden of excess private debt.