Bernanke just made a very important statement, as proved by the fact that everyone on Twitter tweeted it at the same time.
According to Bernanke, the economy still sucks because there’s been so little government spending.
This of course stuns a lot of people who think there’s been TONS of government spending.
But there hasn’t been.
Last week Justin Wolfers tweeted this chart showing that the pace of government spending growth is WAY slower than it has been in past recoveries.
And then there’s this chart from Calculated Risk, showing how public sector employment is way down compared to other recoveries.
Now you can debate why this is. A lot of the austerity is at the state level. But the point is, the trajectory of public sector spending and employment is much lower than it normally is after GDP.