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Harold Meyerson – Obama’s pitch for a second stimulus could be his FDR moment – washingtonpost.com
tags: Economics
- In putting forth a second stimulus, the administration is acknowledging the limits (while not disputing the necessity) of the top-down economic revival strategy that Congress and the Bush administration adopted by enacting TARP — chiefly, a program to aid major banks — last fall. The Obama White House has made the same discovery that Franklin Roosevelt’s White House made 75 years ago: that propping up banks is not sufficient to get the economy moving again so long as banks look at a deeply beleaguered economy and see nothing but a sea of risk. By adamantly refusing to lend to small businesses, banks — for that matter, capitalism itself — compel the government to create the economic conditions that would entice them to begin lending again. So the government becomes the de facto banker to a small-business sector abandoned by private-sector banks, even though those banks have received massive public assistance. A more frontal challenge to conservative ideology, and a more difficult one for conservatives to oppose, is hard to imagine.
Posted from Diigo. The rest of my favorite links are here.
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