It’s true that things aren’t as bad as they were during the worst of the Depression. But that’s not saying much. And as in the 1930s, every proposal to do something to improve the situation is met with a firestorm of opposition and criticism. As a result, by the time the actual policy emerges, it’s watered down to such an extent that it’s almost guaranteed to fail.
We’ve already seen this happen with fiscal policy: fearing opposition in Congress, the Obama administration offered an inadequate plan, only to see the plan weakened further in the Senate. In the end, the small rise in federal spending was effectively offset by cuts at the state and local level, so that there was no real stimulus to the economy.
Now the same thing is happening to monetary policy.
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2 comments:
Our economic policy should be as follows: 1) Find out what Paul Krugman is currently recommending. 2) Determine what the exact opposite policy would be. 3) Implement that exact opposite policy x 10.
Within 3 months we'd be at full employment and running a $200B surplus.
What evidence can Krugman produce that even hints that Keynesianism works? It is a religion more than a science and their bible is comprised of hundreds of Ivy League textbooks. Textbooks written for the sole purpose of backing big government solutions to resolve all levels of economic problems.
Krugman is simply the Jim Jones of the Keynesian cult, distributing the deficit-laced econimic koolaid to his economically challenged followers around the world.
Krugman has never held a job in the private sector. Nor has he ever had to carry a payroll. Nor, I bet, have any of those who have devoted their lives to the religion of Keynesianism.
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