Christina D. Romer, Chair of the White House Council of Economic Advisers
I came across this rather compelling post by Robert Creamer on HuffPo today. Creamer is a political organizer and strategist, and has been for almost four decades. He and his firm, the Strategic Consulting Group, work with many of the country’s most significant issue campaigns. He was one of the major architects and organizers of the successful campaign to defeat the privatization of Social Security. He is a consultant to the campaigns to end the war in Iraq, pass universal health care, change America’s budget priorities and enact comprehensive immigration reform. He has also worked on hundreds of electoral campaigns at the local, state and national level.
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‘Even as Republicans blather on about the evils of a so-called “government takeover of health care,” economic news has provided two new key illustrations that the intellectual foundation of right-wing economic orthodoxy has collapsed. Despite the pseudo-religious psycho-babble of Right-wing economists such as CNBC’s Larry Kudlow, it has failed utterly. Supply-side and monetarist economic theories lead to income disparity and cowboy capitalism that leads to economic crises like the one we find ourselves in now.
First, the most recent economic numbers on changes in Gross Domestic Product (GDP) and employment made it increasingly clear that — as The New York Times reported last Saturday — the Obama economic stimulus and the massive government intervention in the financial markets were the critical medicine needed to prevent complete economic collapse.
It is now clear that, left to their own devices, there can be no doubt that private financial markets would have pulled the entire economy into another Great Depression. Though job losses continued, last month they continued to shrink from their massive January highs. At the same time, the contraction of the GDP dropped to its lowest level since Lehman Brothers collapsed last September.
Even as the Right continues to rail against President Obama’s stimulus package, there is now clear empirical evidence, and near-universal consensus that the $700-billion-plus stimulus bill is largely responsible for beefing up the GDP in the last quarter. Studies by the private research firms IHS Global Insight and MoodysEconomy.com concluded that it is already responsible for saving 500,000 jobs.
Everyday there is fresh evidence that government spending to stimulate demand was critically necessary to pull the country out of the economic tail spin caused by the reckless risk-taking of essentially unregulated private financial markets. Contrary to right wing theory, private consumer demand and new business investment are not leading the way out of the Great Recession — in reality, government demand was an absolute necessity. In short, Keynesian economic principles saved the day.
Next, the second piece of economic news tells even more about the bankruptcy of right wing economic thought.’ Read more here. . .
