Two Great Reads On The Failed Stimulus And The Horrible Economy

Looking for some Sunday night brain-mulch?

Here are two great reads.

First is Robert Reich on the shrinking middle class and widening inequality in America.

There’s a lot in there, but basically Reich divides the post-war economy into two periods: The Great Prosperity (1947-1977) and then, and then the Great Regression (1977-now). Reich tells a compelling story of policies increasingly tilted towards large corporations, Wall Street, and the rich, and a middle class that went deeper and deeper into debt in order to keep up, ultimately leading to the current bust.

You should check out the whole infographic comparing the two periods. Here’s just a small slice of it.


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Meanwhile, for some good old fashioned fighting, check out Jonathan Chait in the NYT claiming that liberals aren’t sufficiently sympathetic to the pickle that Obama finds himself in and that there’s a lot of after-the-fact carping about how the stimulus was always too small. For a really good rejoinder, check out this post at FireDogLake which rounds up all of the liberal commenters who, at the time of the Recovery Act in early 2009, recognised that the stimulus would be insufficient. The bottom line: When Krugman et. al. whine that the stimulus wasn’t large enough to move the needle, he at least deserves credit for having said so at the time.