http://www.nytimes.com/2010/08/09/op..._r=1&th&emc=th

August 8, 2010
America Goes Dark
By PAUL KRUGMAN

The lights are going out all over America - literally. Colorado Springs
has made headlines with its desperate attempt to save money by turning
off a third of its streetlights, but similar things are either happening
or being contemplated across the nation, from Philadelphia to Fresno.

Meanwhile, a country that once amazed the world with its visionary
investments in transportation, from the Erie Canal to the Interstate
Highway System, is now in the process of unpaving itself: in a number of
states, local governments are breaking up roads they can no longer
afford to maintain, and returning them to gravel.

And a nation that once prized education - that was among the first to
provide basic schooling to all its children - is now cutting back.
Teachers are being laid off; programs are being canceled; in Hawaii, the
school year itself is being drastically shortened. And all signs point
to even more cuts ahead.

We're told that we have no choice, that basic government functions -
essential services that have been provided for generations - are no
longer affordable. And it's true that state and local governments, hit
hard by the recession, are cash-strapped. But they wouldn't be quite as
cash-strapped if their politicians were willing to consider at least
some tax increases.

And the federal government, which can sell inflation-protected long-term
bonds at an interest rate of only 1.04 percent, isn't cash-strapped at
all. It could and should be offering aid to local governments, to
protect the future of our infrastructure and our children.

But Washington is providing only a trickle of help, and even that
grudgingly. We must place priority on reducing the deficit, say
Republicans and "centrist" Democrats. And then, virtually in the next
breath, they declare that we must preserve tax cuts for the very
affluent, at a budget cost of $700 billion over the next decade.

In effect, a large part of our political class is showing its
priorities: given the choice between asking the richest 2 percent or so
of Americans to go back to paying the tax rates they paid during the
Clinton-era boom, or allowing the nation's foundations to crumble -
literally in the case of roads, figuratively in the case of education -
they're choosing the latter.

It's a disastrous choice in both the short run and the long run.

In the short run, those state and local cutbacks are a major drag on the
economy, perpetuating devastatingly high unemployment.

It's crucial to keep state and local government in mind when you hear
people ranting about runaway government spending under President Obama.
Yes, the federal government is spending more, although not as much as
you might think. But state and local governments are cutting back. And
if you add them together, it turns out that the only big spending
increases have been in safety-net programs like unemployment insurance,
which have soared in cost thanks to the severity of the slump.

That is, for all the talk of a failed stimulus, if you look at
government spending as a whole you see hardly any stimulus at all. And
with federal spending now trailing off, while big state and local
cutbacks continue, we're going into reverse.

But isn't keeping taxes for the affluent low also a form of stimulus?
Not so you'd notice. When we save a schoolteacher's job, that
unambiguously aids employment; when we give millionaires more money
instead, there's a good chance that most of that money will just sit
idle.

And what about the economy's future? Everything we know about economic
growth says that a well-educated population and high-quality
infrastructure are crucial. Emerging nations are making huge efforts to
upgrade their roads, their ports and their schools. Yet in America we're
going backward.

How did we get to this point? It's the logical consequence of three
decades of antigovernment rhetoric, rhetoric that has convinced many
voters that a dollar collected in taxes is always a dollar wasted, that
the public sector can't do anything right.

The antigovernment campaign has always been phrased in terms of
opposition to waste and fraud - to checks sent to welfare queens driving
Cadillacs, to vast armies of bureaucrats uselessly pushing paper around.
But those were myths, of course; there was never remotely as much waste
and fraud as the right claimed. And now that the campaign has reached
fruition, we're seeing what was actually in the firing line: services
that everyone except the very rich need, services that government must
provide or nobody will, like lighted streets, drivable roads and decent
schooling for the public as a whole.

So the end result of the long campaign against government is that we've
taken a disastrously wrong turn. America is now on the unlit, unpaved
road to nowhere.