Dana Milbank describes lunch at the National Press Club where Christina Romer, chairman of President Obama's Council of Economic Advisers was giving a farewell speech and the news, while not surprising to some, was dismal.
She had no idea how bad the economic collapse would be. She still doesn't understand exactly why it was so bad. The response to the collapse was inadequate. And she doesn't have much of an idea about how to fix things.
What she did have was a binder full of scary descriptions and warnings, offered with a perma-smile and singsong delivery: "Terrible recession. . . . Incredibly searing. . . . Dramatically below trend. . . . Suffering terribly. . . . Risk of making high unemployment permanent. . . . Economic nightmare."
Anybody want dessert?
One key portion of Milbank's article caught my eye:
....When she and her colleagues began work, she acknowledged, they did not realize "how quickly and strongly the financial crisis would affect the economy." They "failed to anticipate just how violent the recession would be."
Even now, Romer said, mystery persists. "To this day, economists don't fully understand why firms cut production as much as they did or why they cut labor so much more than they normally would." Her defense was that "almost all analysts were surprised by the violent reaction."
Not true, all analysts were not surprised, just the ones in the Obama administration were surprised that massive borrowing and spending on the part of the government, passing trillion dollar initiatives, threatening to raise taxes on those producing and employing, would cause such a "violent reaction."
Threaten their money, they will stop spending it. Threaten to massively tax their businesses and they will stop hiring and producing. Spend money you do not have to spend and they will stop investing.
That is not a violent reaction, that is a response to the Obama administration and the Democrat's policies.
That miscalculation, in turn, led to her miscalculation that the stimulus package would be enough to keep the unemployment rate from exceeding 8 percent. Without the policy, she had predicted, unemployment would soar to 9.5 percent. The plan passed, and unemployment went to 10 percent.
Hell of a miscalculation. Now she calculates that more spending is needed?
She is not the only one that needs to go. Obama's whole economic team has failed and now they want to throw more money at the problem instead of.. what was that term they constantly used about George Bush?...oh yessssssss..... instead of changing course.
Stop the spending, extend any and all tax cuts, stop with the punish the rich mentality, which will in turn punish businesses, and perhaps they will start producing at level again, perhaps they will start hiring, perhaps they will start spending their money to stimulate the economy.
[Update] Must Read- Summer of Economic Discontent.