Through a Glass, Darkly

Paul Krugman has a vision of the future, and it's not exactly a rosy one.

...economic half-measures have landed the Obama administration in a trap: much of the political establishment now sees stimulus as having been discredited by events, so that it’s very hard to come back and scale the policy up to where it should have been in the first place. Also, with the apocalypse on hold, the deficit scolds have come back into their own, decrying any policy that actually involves spending money.

The result, then, will be high unemployment leading into the 2010 elections, and corresponding Democratic losses. These losses will be worse because Obama, by pursuing a uniformly pro-banker policy without even a gesture to popular anger over the bailouts, has ceded populist energy to the right and demoralized the movement that brought him to power.

Krugman is a pessimist, and I tend to like that in a practitioner of the Dismal Science. You need some kind of counter-balance to the hucksters and con men you see on CNBC.

History has presented Obama with some awful choices. The financial panic engineered in part by Bush, and the giant deficits engineered almost entirely by Bush and Rove combine for a trap that's hard to escape. Add in the hash Bush made of our foreign policy and its easy to see most timelike paths leading to doom or at least to gloom.

Can some kind of jobs program (a) pass the Congress, and (b) turn things around? Possibly.

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