Worse, the most vocal tour guides keep pointing us to the car crusher. They insist that the already severely depressed economy head down the road of further contraction. Such a hard right turn in a time of slack and sagging economic activity puts us on a one-way street to the junk yard.
Look, the corporate class is flush with cash, bank reserves are full to the brim, money is available to borrow at historically low interest rates, but there is little or no private sector investment because demand has utterly tanked, thanks to the totally tapped out consumer. It has absolutely nothing to do with government debt or deficits. Nothing. It has everything to do with the debt burdened balance sheets of everyday Americans.
A vibrant and vigorously growing economy needs a strong market for its goods and services, it needs customers with money to spend. It is just that simple. But working people in this country are overextended, scared to death, underpaid, and often not paid at all except for unemployment insurance. The good news is that the public sector, that is, government, can come to the rescue. The bad news is that it won't because we are too stupid or ignorant to let it.
Harsh words, I know. But I also know that we as a people richly deserve them. As others like Nobel laureate and NY Times columnist, Paul Krugman, have pointed out, this is like 1937 all over again. By then, the New Deal had managed to pull the country from the depths of the Depression to a condition of nascent recovery. But conservative political and economic pressure pushed FDR to reign in the spending in favor of belt tightening, budget balancing nonsense, and, bam, things started to go south again. Only the lavish spending occasioned by a small matter known as WWII was finally able to restore economic vitality. I would like to think that we are hellbent on reprising that script because we are historically illiterate, that we wouldn't act so stupidly if we knew what we were doing. But I fear I'm wrong.