Comments on: The most laughable guest opinion that has run so far this year in the MJS appears in Sunday’s paper

By: J. Strupp

J. Strupp — Tue, 27 Jul 2010 05:48:55 +0000

“I’ll trust the private sector over the government to provide economic growth every day of the week and twice on Sundays.”

And so do I. And when the private sector can stand on two feet again without the need for additional government spending and/or QE, I’ll be happy to change my tune.

“The Great Depression lasted into World War II precisely because government tried to make the decisions on where the majority of money in the country would be spent.”

And what was the unemployment rate the 6 years prior to WWII? And what was the trajectory of unemployement prior to the austerity debacle of 1937-38? (I hate referencing Wiki but this chart is easier to read than BLS reports from the 1940’s and it seems pretty accurate):

http://upload.wikimedia.org/wikipedia/commons/5/58/US_Unemployment_1910-1960.gif

By: steveegg

steveegg — Mon, 26 Jul 2010 21:29:45 +0000

In reply to J. Strupp.

I’ll trust the private sector over the government to provide economic growth every day of the week and twice on Sundays.

We’ve tried the government method before. The Great Depression lasted into World War II precisely because government tried to make the decisions on where the majority of money in the country would be spent. In fact, it took until after World War II, when private enterprise was finally allowed to fill demand pent up by 4 years of government-enforced rationing and a decade of depressed economy, to finally get out of the Great Depression.

By: J. Strupp

J. Strupp — Mon, 26 Jul 2010 03:40:27 +0000

You’re actually right for a change. Romer’s belief that private sector growth is capable of bringing about vast improvement in the unemployment rate is ridiculous at this point. It’s obvious that they’re not delusional, they’re just betting all of their chips on the private sector leading us to the promise land even though they have no customers.

It’s insanity to bet your political future on a longshot. I wish them luck.

Without a massive boost in government spending or another bout of QE by the Fed. we’re going to sit in this funk for years and they (and us) will continue to suffer the consequences.