Barackface: Great Depression

Showing posts with label Great Depression. Show all posts

Friday, March 05, 2010

The Obama FDR Parallels

"The New York Times columnist Paul Krugman, who fears a lost decade, said in a lecture at the London School of Economics last summer that he has “no idea” how the economy could quickly return to strong, sustainable growth."

FDR's was the Great Depression. We are calling ours the Great Recession. FDR gave us Social Security, Obama is going to give Universal Health Care. The recession is over. The recession is not over. You love me, you love me not.

I think there are obvious parallels between the Great Depression and what we are going through right now, but it is also important to realize we are treading new territory.

(1) The Bailout

That was necessary. It is interesting that many of the banks have already paid back most of the money. I am on record at this blog saying that is what will happen, although I did not see it happening this fast. But they have not paid back all the money, so.

The bailout was putting the fire out. Without the bailout it would not have been a Great Recession but Great Depression II.

(2) The Stimulus

It was necessary but insufficient. When it was put together, I was not shocked by the size of it. What did bother me was it focused too much on the past and too little on the future. I was surprised how little was allocated to broadband, for example.

(3) Banking Regulation

Work here has not gone as well as needed. Wall Street needs a new set of pants. Take off the boxer shorts. Put on some pants.

(4) Public Works Programs

Basically I am arguing for a second stimulus package that might be similar in size to the first one. This would be one pig push to create a truly post-industrial America. The first big wave of job creation will have to be the government's work, otherwise the 10% unemployment figure is feeling pretty comfortable where it is. You did not rely on the market for the bailout, or the stimulus, you sure do not expect the market to do the regulation work. That same courtesy has to be extended to job creation.

Most of the job creation will happen in the education and health sectors. Instead of creating a Tennessee Valley Authority, you would create a program to hire a ton of mentors to kick-start the inner cities, for example.

Universal and faster broadband is fundamental to this very idea. That is the centerpiece. That basic physical infrastructure is what will take both education and health to their next levels. Obama has to build that universal, faster broadband infrastructure like Eisenhower built the interstate highway system. Without that America is not going to become a post-industrial society. People will have to be plugged in.

The idea has to be for the government to hire five million people. If you are going to do it anyway, it makes no sense to do it later, or do it in small steps. Creating new jobs has to be the centerpiece of the second stimulus bill.

Education and health will have to be reimagined. That is why getting health care right is so key. It can't just be about adding entitlement programs for people who are known will not pay in, although everyone has to be covered. It also has to be about bringing the costs down across the board. You inject technology and the market forces into the sector.

On Deficits And Debts

The time to reign in the deficit and the debt will come, but that time is not now. Once the recovery is full, the political wind will blow in that direction.

Tuesday, September 15, 2009

The Economic Profession Messed Up

http://twitter.com/paramendra/status/3770105844

And here we have one of them owning up to it.

How Did Economists Get It So Wrong? Paul Krugam, New York Times ....... in a 2008 paper titled “The State of Macro” (that is, macroeconomics, the study of big-picture issues like recessions), Olivier Blanchard of M.I.T., now the chief economist at the International Monetary Fund, declared that “the state of macro is good.” The battles of yesteryear, he said, were over, and there had been a “broad convergence of vision.” ........ the “central problem of depression-prevention has been solved,” declared Robert Lucas of the University of Chicago in his 2003 presidential address to the American Economic Association ........ Last year, everything came apart. ........ the 1987 stock crash, in which the Dow plunged nearly 23 percent in a day for no clear reason ......... U.S. households have seen $13 trillion in wealth evaporate. More than six million jobs have been lost ........ even as the recession continued to deepen, conventional monetary policy had lost all traction. ....... flaws-and-frictions economics will move from the periphery of economic analysis to its center. ....... has brought the world economy to its knees. .......... “the market can stay irrational longer than you can stay solvent.” ........ until now the impact of dysfunctional finance hasn’t been at the core even of Keynesian economics. ......... financial markets fall far short of perfection, that they are subject to extraordinary delusions and the madness of crowds ........ H. L. Mencken: “There is always an easy solution to every human problem — neat, plausible and wrong.”

Globoeconomics: Name Of The Game

Micro To Macro To Globo

70 years back the economic profession went up one notch, from micro to macro. Now is the time to go up another notch: from macro to globo. The churn we see is of a US and a global economy tumbling to the global winds. New, robust, global institutions are needed, old ones have to be reinvented.

Old Jobs: Gone Jobs

The Great Depression saw the loss of countless agricultural jobs that never came back. World War II had to create a new set of industrial jobs. The old industrial jobs now lost in America will likely never come back. The country will have to make new strides and create many, many post-industrial jobs.

A Misguided Stimulus?

I thought a big chunk of the stimulus was going to go to ensure universal broadband. Instead they went to old highways, the offline kind.

Another War?

Will a full-fledged war to ensure a total spread of democracy in the Arab world finally get America out of the flunk? Could that be a war that brings about Iran-like mass movements? Is that war essentially one of communications technology?

The purpose of stimulus September 4, 2009 the recession — again, as officially defined — is over. ...... But unemployment is still very high and rising
A strange madness September 4, 2009 Something is going very wrong in the heads of a substantial number of Americans.
My whereabouts September 4, 2009

Thomas L. Friedman: Our One-Party Democracy New York Times It is not an accident that China is committed to overtaking us in electric cars, solar power, energy efficiency, batteries, nuclear power and wind power. ....... “Just because Obama is on a path to give America the Romney health plan with McCain-style financing, does not mean the Republicans will embrace it — if it seems politically more attractive to scream ‘socialist’ ” ....... no one needs the burden of health insurance shifted from business to government more than American business. No one needs immigration reform — so the world’s best brainpower can come here without restrictions — more than American business. No one needs a push for clean-tech — the world’s next great global manufacturing industry — more than American business. Yet the G.O.P. today resists national health care, immigration reform and wants to just drill, baby, drill.

White House Reveals Obama Is Bipolar, Has Entered Depressive Phase

Obama Drastically Scales Back Goals For America After Visiting Denny's

Tuesday, September 08, 2009

Gun Toting Protestors: Racist

They did not show up for either Bush, Clinton, or the elder Bush. So this is not partisan. They did not show up for FDR, so this is not to do with the Great Depression's grand cousin, the Great Recession that we are ploughing through right now.

This is about race and racism. This is guttural. This is about some guys showing up with knives at a Hillary health care rally in Oregon in 1994. That was about gender, like Newt Gingrich told Bob Reich back then, "Tell the president, we like him, but his wife should not be making policy."

You can be thrown in jail for putting in writing that you intend to harm the President Of The United States, but you are okay if you show up for his rally with a gun? This makes absolutely no sense. The news is not that they are showing up, but that we are putting up with their showing up with their guns.

Granted the secret service keeps cordons around the POTUS, but how long before some nut mows down about 10 people in the audience before we cry Columbine? The political damage would be huge.

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