NEW YORK TIMES: …Now one of the world’s leading economic historians, Barry Eichengreen, has come forth with an alternate view: Rather than hoist anyone to our shoulders for preventing another Depression, we should be more cleareyed about the ways in which global leaders did not really learn the lessons of the 1930s at all and made many of the same mistakes as their Depression-era counterparts.
His new book, “Hall of Mirrors” (Oxford University Press), accuses the global leaders of the 21st century of failing to heed the warning signs that a crisis might occur and then becoming too self-satisfied with the initial success they had at containing the worst effects of the banking crisis in late 2008 and early 2009.
When the crisis first arose, policy makers of all political stripes could agree that fiscal stimulus would help the economy weather the rough times. In early 2008, the idea that fiscal stimulus could help encourage economic growth was uncontroversial enough that President George W. Bush and overwhelming majorities of a Democratic Congress agreed to a $152 billion package. By 2009, the idea had become politically polarizing. President Obama’s much larger stimulus passed, but with hardly any Republican votes. And by 2011, even many Democrats accepted that it would be a year of pivoting toward deficit reduction. With the economy still ailing despite hundreds of billions spent, “stimulus” had become a dirty word… (more)
EDITOR: Right wing empty-headed ideologues scared the public and Congress and deprived the nation with the fiscal stimulus that would have brought recovery at least two years earlier, saved the country trillions of dollars, and prevented the ruin of countless lives.
