, , , , , , ,

Any of this sound familiar?

“The U.S. economy has been crippled by a financial crisis. The president’s policies have limited the damage, but they were too cautious, and unemployment remains disastrously high. More action is clearly needed. Yet the public has soured on government activism, and seems poised to deal Democrats a severe defeat in the midterm elections.


Gallup polling… [a]sked whether government spending should be increased to fight the slump, 63 percent of those polled said no. Asked whether it would be better to increase spending or to cut business taxes, only 15 percent favored spending; 63 percent favored tax cuts.”

The result?

“And the…election was a disaster for the Democrats, who lost 70 seats in the House and seven in the Senate.”

The year was 1938. The president was Franklin Delano Roosevelt. Now here we are again:

“More stimulus is desperately needed, but in the public’s eyes the failure of the initial program to deliver a convincing recovery has discredited government action to create jobs.”

So what is the Obama administration proposing as a solution for a stagnant economy and insufficient job creation? Tax cuts, tax cuts, and more tax cuts:

“With just two months until the November elections, the White House is seriously weighing a package of business tax breaks – potentially worth hundreds of billions of dollars – to spur hiring and combat Republican charges that Democratic tax policies hurt small businesses, according to people with knowledge of the deliberations.”

Good, sound political strategery—let the opposition define the terms of engagement and play into their theme that tax cuts are the prescription for whatever ails the economy. And speaking of political strategery, how the hell is anybody still unclear on this subject?

“If administration officials can agree on a policy path, it is not clear that it would be approved in the current environment on Capitol Hill.”


Krugman concludes:

“But always remember: this slump can be cured. All it will take is a little bit of intellectual clarity, and a lot of political will. Here’s hoping we find those virtues in the not too distant future.”

That’ll be the day.