Patterico's Pontifications

12/9/2008

Obama Administration Won’t Let Economic Crisis Go to Waste

Filed under: Economics,Obama — DRJ @ 12:45 pm



[Guest post by DRJ]

U.S. News columnist James Pethokoukis surveys the Obama economic plan (or as Pethokoukis calls it, “Obama’s depressing economic delusion”) and explains why it will make the economy worse. It’s depressing but also brief, so read the whole thing.

He concludes with the words of Rahm Emanuel, who is loathe to let this economic crisis go to waste:

Then again, an economic crisis that you can continually blame on a previous administration can be politically advantageous. (Heck, it got Obama elected.) It’s the gift that keeps on giving. As incoming White House Chief of Staff Rahm Emanuel said last month, “You never want a serious crisis to go to waste. This crisis provides the opportunity for us to do things that you could not do before.” With our current economic woes providing momentum for the liberal agenda on healthcare reform, infrastructure spending, and “green” energy investment, the Obamacrats might be thinking, “Fix the economy? What’s the rush?

And we know the economy will get worse, because Obama told us it will.

— DRJ

14 Responses to “Obama Administration Won’t Let Economic Crisis Go to Waste”

  1. Fix the economy? What’s the rush?“

    Oh, I don’t know, so maybe the voters don’t blame the Democrats in 2010 for not making things better? And Obama’s saying things will get worse is definitely him trying to lower expectations, but at best it will buy him some months, not years, before voters start blaming him for the government not paying their mortgage.

    steve sturm (369bc6)

  2. Obama ain’t fixing shat. He going to throw money at Unions and pray they come out en masse along with other aggrieved classes in 2012.

    This is not about the “best man” — it is about buying votes as efficiently as possible. Who cares how the economy does.

    Da'Shiznit (089453)

  3. It is now more important than ever to lay the last two years of economic non-performance at the feet of the Democrat controlled Congress, that promised us a better, more ethical Congress if we put them in charge in 2006.

    For two years they have passed virtually everything that they have wanted; and now, they have a President who is on the same wave-length as they are.

    No more excuses, Nancy and Harry!

    Another Drew (0c4ac4)

  4. Being Liberal means never having to say you are sorry for your lousey record.

    Liberals have good intentions ya know!!!!

    Da'Shiznit (089453)

  5. How many of you folks, back in 2005-06, were busy trying to find some primary or secondary reason to blame Dems for some issue or another (the war in Iraq comes quickly to mind) while your (and my) side was in total control? The Dems/Left quickly found ways to embarass you. I have great confidence that the Reps and Cons will do the same thing to Obama and the Dem Congress, even though the economy is supposedly never a Rep strong suit.

    Things move too fast for blame to stick, after you’ve won everything. Obama will really find out how fast things move when he realizes how hard it will be to gin up turnout in ’10.

    Brad S (9f6740)

  6. BTW, as far as predictions on the economy, ANYONE who is projecting macroeconomic trends out farther than ONE QUARTER is blowing smoke out his rear end. National Review’s “symposium” on Deflation is online, and it’s a joke.

    Brad S (9f6740)

  7. Deflation is no joke and it is a major concern now. That’s not to say that NRO, or anybody else, is doing a good job of predicting the future. After watching the housing crisis build since 2005, I think there is no one in Washington who knows jack s**t about economics. Stiglitz is in the well-known economic journal Vanity Fair pontificating on how the Bush tax cuts were a mistake. I’m sure if he were running things we would have been in a recession since the dot-com bubble burst in 2000.

    His title conveys his POV nicely.

    Mike K (531ff4)

  8. Only the NRO “symposium” is a joke; deflation may be a problem now, but I have serious doubts it will be 6-9 MONTHS from now. Too much cash on the sidelines right now for deflation to persist further.

    Brad S (b5b919)

  9. As long as the value of commodities drop, and the value of real estate drops,
    we have to take the issue of deflation seriously;
    particularly when you have massive employment disruption at the same time,
    and the financial sector is “locked up”.
    Now, we have hints out of China about a seriously slowing economy there, and the same is happening in India.
    If international trade seriously slows, or comes to a standstill….
    Welcome to the Great Depression!

    Another Drew (dd7bc2)

  10. […] those useful economic crisis! Kinda makes you feel oh so hopeful doesn’t it? Look at what Rahm Emanuel is saying about the current economic crisis. Then again, an economic […]

    Oh those useful economic crisis! « The Daley Gator (2dc949)

  11. Oil and housing prices have dropped because speculative bubbles have popped, credit has partially seized up because people have discovered (the hard way) that securitized mortgages bought from Fanny May and Freddy Mac aren’t as safe as they thought. The problem isn’t liquidity, it’s velocity. That’s why all the liquidity the Fed has been pumping hasn’t been doing much good.

    Europe is partly suffering from buying our bad mortgages, but they’ve had their own bubbles that are popping. China and I think India are mainly suffering from the fact that their customers (us) are having problems and aren’t buying as much.

    LarryD (feb78b)

  12. The Fed is using the money supply (liquidity) to make up for the lack of velocity, since money supply X velocity roughly equals GDP.
    Velocity has been dropping like a stone over a cliff, and the Fed is attempting to keep the GDP up by increasing the money supply.
    The bubbles have already burst, the problem now is a lack of world wide demand driving commodity prices downward.
    We are in a deflationary spiral, with the Fed pumping liquidity into the system, hoping it can turn off the spigots at the correct moment when the economy turns to prevent hyper-inflation.
    If they are as good as they hope they are, all will be well.
    If they screw-the-pooch, the Carter years will seem like a walk-in-the-park.

    Another Drew (cba5f8)

  13. “Fix the economy what’s the rush?”
    You can use that same logic to bash the Bush administration and the vast cloud of military and construction contractors whirling around it getting theirs as fast as they can. “Get out of a war? While everybody’s making so much money? What’s the rush?”

    Lucky for us all the Obama administration is going to stop that… oh right, they aren’t, are they? Dem cronies want theirs too!

    EdWood (c2268a)


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