They keep burying these deeper and deeper
but I keep finding them! Bob Shiller continues his relentless march deeper and deeper into the NY Times Sunday Business Section, but I ferreted his column out on page 8!
Lets take a quick sample:
THE failure of the Congressional supercommittee to come up with any agreement on the budget deficit makes it even less likely that Congress will rise above its partisan divisions and act on behalf of the millions of out-of-work Americans.Yet without government intervention, we may well have high unemployment and social discord for years to come. How did this disaster happen?
Let's blow right by the supercommittee non-sequitor and focus on the second sentence: without government intervention.
He doesn't say "without FURTHER intervention"; he acts like nothing has been done!
Hey Bob, lets take a peek at the Fed's balance sheet:
No government intervention? Dude!
How about on the fiscal side?
Since 2007, We've more than tripled the Fed's balance sheet and more than tripled the Federal deficit. I think that qualifies as a fair amount of "government intervention" (am I weird to think that when automatic fiscal stabilizers kick in that counts as government intervention?).
Yes, long term unemployment is a big problem in this country. Will another $400 billion "jobs" program solve it or even noticeably reduce it? Will another round of quantitative easing solve it?
I think the problem goes far beyond a failure of "demand management"
Labels: economics is harder than that