Paul Krugman sees the future and offers some timely advice to the media.
Suddenly, the economic consensus seems to be that the implosion of the housing market will indeed push the U.S. economy into a recession, and that it’s quite possible that we’re already in one. As a result, over the next few weeks we’ll be hearing a lot about plans for economic stimulus.I've never understood why there's debate over whether or not we're in an actual recession. I'm no economics wonk but since they tell me numbers have absolute value, I would think there would a mathematical formula that clearly defines the term. But that aside, like most ordinary Jakes, what they call it is immaterial to me. I check the state of the economy by looking into my wallet and by the time I've paid my bills, there isn't much folding money left in there. Especially since my health insurance went up $160.00 a month this year. My wages didn't so that's money I won't be spending at my local merchants anymore.
Since this is an election year, the debate over how to stimulate the economy is inevitably tied up with politics. And here’s a modest suggestion for political reporters. Instead of trying to divine the candidates’ characters by scrutinizing their tone of voice and facial expressions, why not pay attention to what they say about economic policy?
But I'm not the only one feeling the pinch of rising costs. Even the have mores are spending less and there's growing rate of credit card defaults among the high end spenders. If that's not a sign of recession, it's still not a good omen.
Meanwhile, since the press won't do it, Krugman parses the candidate's solutions to jumpstart the national spending spree again. Short version. The GOP wants to stay the course and continue to sell the fairy tale of trickle down economics where the rich keep their money and it will magically transform into a gain for working class Americans. Nevermind that this strategy hasn't resulted in a happy ending over the last six years. The rich took that money and hoarded it in foreign investments and tax shelters. It doesn't so much trickle down as it pools among themselves.
The Democrats, or rather Edwards and Clinton, take a more egalitarian approach, suggesting aid to the neediest Americans, increased funding to state governments and public investments in common good programs like alternate energy. Of the three front runners, Obama's proposals skew most to the right, throwing a few crumbs to the masses to justify placating the wealthy and like his health insurance plan, somewhat ignores the very real need for relief among cash strapped cities and lower income Americans.
This underlines what's bothered me about Obama from the beginning. I love the soaring, inspirational rhetoric about unity and change but on the practical level it seems his policies rely too much on tweaking failed models when what's really needed is a major overhaul of the system.