The consensus of wrong
by digby
Zero job growth, with unemployment still at nosebleed levels. Meanwhile, the interest rate on 10-year US bonds is down to 2.04%, and it’s negative on inflation-protected securities.Aren’t you glad we pivoted from jobs to deficits a year and a half ago?Meanwhile, on the other side of the pond, Is austerity killing Europe’s recovery?
After more than a year of aggressive budget cutting by European governments, an economic slowdown on the continent is confronting policymakers from Madrid to Frankfurt with an uncomfortable question: Have they been addressing the wrong problem?
Yah think?Too bad there weren’t any prominent economists warning that the obsession with short-term deficits was a terrible mistake, that austerity would undermine hopes of recovery. Oh, wait.
He says that he’s still gathering his thoughts about why this happened and I’ll be interested to read what he has to say.
Back in the day I used to pose a question every once in while just to get a read on whether any consensus was emerging: Why did we go into Iraq? Inevitably, there would be at least a dozen different answers, all plausible, all probably held by some Very Serious Person or war hawk somewhere. I suspect we’re going to see the inexplicable move to austerity the same way. There were different reasons, but all of them were wrong.
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