Monday, July 05, 2010

WSJ On Pessimissm

Op-Ed Columnist - The Pessimism Bubble and the Economy -

Good to see that the WSJ connection with reality is solid enough for them to understand that things haven't been going so swimmingly since we began the "era of change" with the Democratic congressional takeover in '06, followed by the BOslide of '08. Their explanation? It's a "bubble" ... a "pessimism bubble".

How grim? Well, after the United States limped through five months of anemic “recovery,” last Friday brought news that our economy actually shed jobs in June, thanks to the expiration of more than 200,000 Census positions. It’s now been 30 months since the beginning of the recession, and it looks as if it could take another 30 or so to regain the level of employment we enjoyed in the autumn of 2007.

That is the potential "good news" ... the public seems to erroneously think it is worse than that.

Pessimism bubbles formed during America’s last two economic crises — the stagflation era in the late 1970s and the post-cold war recession that ushered Bill Clinton into the White House. Go back and read Jimmy Carter’s famous “malaise speech,” which liberals have lately been rehabilitating. With its warnings about retrenchment, rationing and a permanent energy crisis, it feels like a contemporary document. But it isn’t, and Carter’s prophecies were wrong: the grimmest speech any modern president has given was delivered just a few years before America kicked off a long era of impressive economic growth.

The tiny little post gulf-war recession was like the late '70s? The only real disaster parallel there is that folks were so spoiled that just that small little recession ushered in Slick Willie, but fortunately, we sobered up quick, and got Newt and company to right the ship two short years later. Let us pray that sobriety is as swift in 2010!

No comments:

Post a Comment