Paul Krugman: Economy Was Never 'On The Road To Recovery'

Reich replied:

Well, it is surprising­.  I mean, we do have - Howard is absolutely right.  The data - capacity of the government is not nearly as good as it was before.  But you got all of Wall Street, all of the private sector looking at whatever data they have, and everybody basically called it wrong.  A lot of people who should have known better and still should know better have said that all along - well, everything will be fine if we just cut the government and cut government spending.  Well, the fact of the matter is - state and local government­s are cutting like mad.  Have been cutting and now we have tied the hands of the federal government with regards to any kind of an expansiona­ry stimulus boost to the economy.  We've actually generated a fiscal drag at the federal level, at the state level, while consumers are not and will not spend.  This is the worst of all worlds.  And I think that we've got to go back to the drawing boards.  And when Congress comes back, the president has got to say, "Here is a jobs bill.  This is the most important thing in the country right now to Americans.  And I'm going to fight for it."

The fact of the matter is that everybody didn't get it wrong.  

How is it that the decision-m­akers didn't know when so many others (the left) did?  Krugman didn't get it wrong.  Even non-econom­ists (like me) didn't get it wrong.  The political and media establishm­ent can't have it both ways, by blaming it on inadequate and faulty data, when the data was available and evident for others to see and evaluate.  

What really happened was politics and cowardice, and that enabled the greatest heist in the history of the world.  And that is why investigat­ions, hearings, prosecutio­ns and incarcerat­ion are necessary.
About Ben Bernanke
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