Misreading the Economy: Fact Or Fiction?
Thursday, July 09, 2009 at 06:44 PM EDT
The first post from our newest Contributor, The Rationalist.
Politico posed this question to its readers in yesterdayâ€™s Arena:
The last part of that question is disturbing on several levels.
Is it still possible for a rational citizen, knowing that his or her tax dollars are going to be sucked into the mountain of stimulus induced debt, to put their faith in the government to solve this economic recession? After all, if the might of the Obama administration cannot reasonably ascertain the current economic environment, can any entity? Are we just wasting our money?
More disturbingly, considering the repetitious doom and gloom press conferences that paved the way for the stimulus bill, how can Biden and the Obama administration justify saying that they misread the scope and severity of the economic crisis? For those who have forgotten, here are a few revealing quotes from several months ago:
On the campaign trail, then Senator Barack Obama called the current recession â€œthe most serious financial crisis since the Great Depressionâ€.
While pushing for the stimulus bill, President Obama stated that the failure to pass the stimulus bill would â€œturn a crisis into a catastropheâ€. In the same speech, he stated that â€œthis is not your ordinary, run-of-the-mill recessionâ€ and that it could result in the â€œlost decadeâ€ that Japan suffered after their recession in the 90â€™s.
In fact, there was so much â€œdoom and gloomâ€ during the period leading up to the stimulus bill that many of his most ardent supporters were wondering if their president was, in fact, the same person who embodied the â€œYes, we can!â€ mentality that inspired the fervor of millions in 2008.
Indeed, the administrationâ€™s statements on the economy are almost impossible to reconcile with the Vice Presidentâ€™s recent statements on their â€œmisreadâ€.
Perhaps the real question is whether the Obama administration truly believed their own words in the lead up to the stimulus bill. They spent hours in press conferences and other high profile public events, addressing the American people, and telling us that without this bill economic recovery might not be possible.
On its face, this seems like acknowledgment of the worst kind of recession â€“ a terminal one. If they are now claiming that they took the situation too lightly, they must not have truly believed what they espoused so vehemently this winter. Furthermore, if thatâ€™s the case, their repeated doom and gloom message was calculated towards a desired effect â€“ passing a pork-filled stimulus â€“ not saving the economy.
If the Obama administration deserves credit for anything, it is effectively understanding and impressing upon the American people the impending economic Armageddon. There is no reason to doubt their words from early 2009 â€“ the economy is still in crisis, unemployment is skyrocketing, and the threat of inflation looms.
If there is anything to doubt, it is undoubtedly the effectiveness of a stimulus bill rushed through Congress, with little to no public vetting, weak bi-partisan support, and self-admitted pork. The Obama administrationâ€™s attempt to accept the blame is actually very clever; if they didnâ€™t divert people from the true cause of our failed stimulus â€“ poor design and implementation â€“ people would be far more weary of allowing the government to â€œstimulateâ€ the economy with their tax dollars any further.
This article originally appeared on The Sad Elephant.