Government is Not to Blame

Paul Krugman, Laureate of the Sveriges Riksban...

Paul Krugman on why it isn't Government that is prolonging the economic recovery:

You often hear assertions to the effect that in the past the economy has always rebounded strongly after a recession, so there must be something special at work here — and that something special must be the socialist in the White House.

Yet the reality is that weak recoveries have actually been the norm for the last two decades: both the 1990-1991 recession and the 2001 recession were followed by prolonged “jobless recoveries”.

The White House's tepid intervention after the collapse in 2008 has resulted in a tepid recovery. Had it seriously restructured the economy and provided jobs for the millions left to fend for themselves after their industries collapsed, the economy would look very different today. Unfortunately, the Republicans have been able to use the weak recovery to argue that it was the little government action that did happen that has prolonged the recovery.

The reality is that Republican economics caused the crash in the first place and Republican economics are actively making the recovery worse. That's why progressives have been up in arms about Obama's dithering, arguing that he should never have compromised with the GOP because they would have smeared him regardless of his policies. Better to get something serious done and take the flak than get nothing done and take the flak anyway.

Enhanced by Zemanta