The New Republic: Opinion: Noam Scheiber: What My Book Got Wrong About, Obama, Summers, Geithner, Recovery
It is rare at least in the last four years or so that I agree with Noam Scheiber on anything. And four years is most of the time that I’ve been blogging. You see more bipartisan cooperation and bills passed in Congress than you see agree with Noam on anything. He is more of a “government can solve every problem on their own, or at least solve every problem, if the people just get out-of-the-way and give government the money to solve their problems for them” Social Democrat. And I’m a New Democrat and believe in limited government and that there’s a limit to what government can do especially by itself.
But Noam is right on when he says that the 2009 stimulus or Economic Recovery and Investment Act was too small. It should’ve been around two-trillion dollars and not paid for. Treated as seriously as the Great Depression and invested all of that money in ending the recession by encouraging people to spend money with individual and business and tax relief. Job creating with a lot of infrastructure and fighting off further unemployment in the public sector with aid to state and local government’s so they wouldn’t have to lay off so many employees.
The ERIA or stimulus had some of that, but not nearly enough because it was about eighty-percent short of what it should’ve been. We were dropping seven-hundred thousand jobs of month in late 2008 and into 2009 when Barack Obama became President. And the economy was dropping seven-percent as well, so what they needed to address that immediately with a huge economic package even through borrowing to put the money back in the economy so the Great Recession wasn’t as bad and as long as it was. As far as how long it would take the country to get through it.
I agree with Noam to a certain extent about the Obama Administration pivoting too fast to debt and deficit reduction. But that is because the stimulus was too small and that since it wasn’t big enough, they should’ve at least attempted and put stimulus two on the table in early 2011. Telling the new Republican House “that I know you don’t think we should do this again with the debt and deficit being where it is, but this is what we need to do because of where the economy is overall. And as President I’m going to do the best that I can to see that it happens and see what we can do in the Democratic Senate”.
I disagree with Noam on the healthcare law. If it wasn’t passed when it was in early 2010, we are still doing with the problems of not passing that law today. People losing their health insurance because they need it, or have a pre-existing condition, or reached some lifetime cap. A lot more low-income workers without any health insurance because the Medicaid expansion is not there. And millions of Americans who simply can’t afford health insurance because their employer doesn’t provide it, or it is too expensive and they aren’t poor enough for Medicaid. With no health care plan on the table and ready to pass it to deal with these issues.
To somewhat defend President Obama here. A brand new fairly inexperienced President who has never run an administration before, whose whole career up to that point was in the private sector and as a legislature in Illinois and not quite four years as a U.S. Senator, coming into power with a boatload of issues he has to deal with immediately, that is the situation that he came into with his background. I could see why he felt the need to do something fast and make it clear to the country that he is on the job. But someone with more experience and perhaps a better team around him would’ve said. “You know what, let’s do this right before we do it fast”. And would’ve gone bigger early on to address the economy even it took Congress longer to pass a recovery bill.