It is becoming pretty darn clear that the fools that created the economic disaster think they can push us through it on their wishful thinking. Idiots like Geithner are painting rosy pictures of what they are doing - with Obama noddingly approving of it - and hoping you, the average American and the ones that are still being crushed economically, won't notice. Yves there:
Meanwhile and according to Paul Krugman,
Brad DeLong wonders how the proponents of tight budgets and tight money are prevailing in the midst of mass unemployment, low interest rates, and incipient deflation.
It’s actually not all that surprising. Horrifying, but not surprising.
The case for expansionary policies in the face of a slump is intellectually difficult; Keynes described the writing of the General Theory as a painful process of discovery, and so it is. The natural instinct of almost everyone is to think that tough times require tough measures, and that if the economy is suffering, the government should tighten its own belt. It would take a clear consensus from economists to overcome that natural bias.
And that consensus has, of course, been lacking — largely because a significant proportion of the economics profession has spent the last three decades systematically destroying the hard-won knowledge of macroeconomics. It’s truly a new Dark Age, in which famous professors are reinventing errors refuted 70 years ago, and calling them insights.
While we bear in mind that there may be real solutions that will stop this disaster from happening again, and the need to really address the results of it honestly, there are the underlying rules of a market whose obscene motto for years was: