Could a GOP president take credit for an accidental recovery?

I totally agree with Yglesias's quibble here:

I half agree with the sentiments in Ezra Klein’s Bloomberg column about the importance of the 2012 election, but I think there’s a dangerously misleading idea lurking there. He quotes Larry Bartels’ brilliant exposition of the point (see this PDF but also this one) that you have to put FDR and the New Deal realignment in comparative perspective. All governments that were in office when the Depression hit lost power, and all governments that were in office during recovery regained it. The implication in the column seems to be a kind of nihilistic one, where economic outcomes are just driven by luck and a bad recession just so happens to take a long time to recovery from...

But the existence of some policies that promote robust recovery from the recession is a necessary ingredient to that mix. The policies we got in 2008 and 2009 were pretty good — they prevented calamity — but they didn’t promote robust recovery and that, rather than bad timing, is why Obama hasn’t benefited from an FDR effect. And whoever’s president in 2013 will have an opportunity — but just an opportunity — to do better on that score. You still need policies that work. It’s entirely possible that we’ll simply shift into a new equilibrium with a permanently elevated pool of long-term unemployed, permanently reduced labor force participation, slow growth, and stagnating living standards.

However, I remembered a couple earlier posts of his positing that perhaps the current housing shortage will eventually touch off a recovery. These charts below tell the story. We've got new housing starts at an all-time low:

And persons per new housing start at an all-time high:

The idea is that eventually, new homes are going to have to be built. With a deeply depressed construction sector, even relatively small growth in new homes would mean a big surge in construction activity, which could spark a virtuous circle of economic growth.

I should note I'm not gunning for hypocrisy here. Again, I agree with Yglesias' point that smart policy is key to recovery from recessions. But it seems that in this particular circumstance, there could be a chance that some kind of recovery could come absent smart any policy intervention at all. After all, there were still recoveries long ago, before Keynes ever wrote any books.

Of course, on the other hand, a GOP president seems likely to ram through a bunch of austerity policies, in which case all bets are off.

Comments

Why Did Reality Winner Leak to the Intercept?

So Reality Winner, former NSA contractor, is in federal prison for leaking classified information — for five years and three months, the longest sentence of any whistleblower in history. She gave documents on how Russia had attempted to hack vendors of election machinery and software to The Intercept , which completely bungled basic security procedures (according to a recent New York Times piece from Ben Smith, the main fault lay with Matthew Cole and Richard Esposito ), leading to her capture within hours. Winner recently contracted COVID-19 in prison, and is reportedly suffering some lingering aftereffects. Glenn Greenwald has been furiously denying that he had anything at all to do with the Winner clusterfuck, and I recently got in an argument with him about it on Twitter. I read a New York story about Winner, which clearly implies that she was listening to the Intercepted podcast of March 22, 2017 , where Greenwald and Jeremy Scahill expressed skepticism about Russia actually b

The Basic Instinct of Socialism

This year I finally decided to stop beating around the bush and start calling myself a democratic socialist. I think the reason for the long hesitation is the very long record of horrifying atrocities carried out by self-described socialist countries. Of course, there is no social system that doesn't have a long, bloody rap sheet, capitalism very much included . But I've never described myself as a capitalist either, and the whole point of socialism is that it's supposed to be better than that. So of course I cannot be a tankie — Stalin and Mao were evil, terrible butchers, some of the worst people who ever lived. There are two basic lessons to be learned from the failures of Soviet and Chinese Communism, I think. One is that Marxism-Leninism is not a just or workable system. One cannot simply skip over capitalist development, and any socialist project must be democratic and preserve basic liberal freedoms. The second, perhaps more profound lesson, is that there is no s

Varanus albigularis albigularis

That is the Latin name for the white-throated monitor lizard , a large reptile native to southern Africa that can grow up to two meters long (see pictures of one at the Oakland Zoo here ). In Setswana, it's called a "gopane." I saw one of these in my village yesterday on the way back from my run. Some kids from school found it in the riverbed and tortured it to death, stabbing out its eyes, cutting off its tail, and gutting it which finally killed it. It seemed to be a female as there were a bunch of round white things I can only imagine were eggs amongst the guts. I only arrived after it was already dead, but they described what had happened with much hilarity and re-enactment. When I asked why they killed it, they said it was because it would eat their chickens and eggs, which is probably true, and because it sucks blood from people, which is completely ridiculous. It might bite a person, but not unless threatened. It seems roughly the same as killing wolves that

Ryan Cooper

Search This Blog