Former Labor Secretary Robert Reich is among the liberal economists and political activists who have been critical of President Obama's emphasis on budget cuts to reach a deal on the debt ceiling.
He's asking why spending, in the form of a new stimulus package, is not on the table.
Reich told Here & Now's Robin Young that government spending would revive the economy and put more people to work.
"[When] you're in a recession or a depression... the government becomes the spender of last resort," he said.
Reich writes in his blog that Americans are now living in parallel universes.
The first, he writes, is "where almost 15 million are unemployed, wages are declining, and we're locked in a vicious economic cycle."
But the problem, says Reich, is that the other parallel universe, Washington D.C., is focusing only on budget cutting.
Republicans are leading the push for spending cuts, and Reich says everyone, including Congressional Democrats and the President, is playing an "I can cut the deficit more than you" game.
Reich says the deficit does need to be brought down in the long term, by targeting military or agricultural subsidies, and by asking the wealthy to contribute more.
"The top one percent of Americans by income are now taking home almost a quarter of all national income. We haven't seen this in 80 years. And at the same time their marginal tax rates are lower than they've been in about 70 years, so it seems entirely fitting that if someone's going to sacrifice, the very wealthy should... But in Washington we can't even begin that conversation."
Reich says that the increasing inequality has lessened the purchasing power of the middle class, further hampering the economy.
"That widening inequality is making efforts to stimulate the economy much more difficult," he said.
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- Robert Reich, professor of public policy at University of California at Berkeley. He's author of "Aftershock: The Next Economy and America's Future"
This segment aired on July 27, 2011.