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by Robyn Blumner
Prospects are not looking too peachy for Democrats this election season. President Barack Obama and Democrats in
Deregulation got America into this mess -- decades of it -- the kind of laissez-faire economics enacted by the
Yet even after this painful object lesson, Republicans in
So the Great Recession was brought to you by deregulation. But thankfully we avoided economic dislocation on a scale equal to the 1930s through the Keynesian federal bailout and stimulus programs, the very initiatives that Republicans are demonizing in the run up to the midterm elections. The Utah GOP even branded one of their own "Bailout Bob" (U.S. Sen. Robert Bennett) and denied him a fourth term because he voted for the TARP funds.
If only we could do a faux replay, like in the film "It's a Wonderful Life," and experience in celluloid what would have happened were it not for government bailouts and stimulus. But the closest we can get is when economists use empirical data to peer into a rearview mirror. According to them, it was only due to government action that America averted the "Great Depression 2.0."
Economists Alan Blinder, a former Fed vice chairman and a
Without these government actions, Blinder and Zandi say that the GDP of the United States would be about 6.5 percent lower this year, we'd be suffering deflation and another 8.5 million jobs would have been lost.
Talk about human misery.
Blinder and Zandi go on to write that the TARP "has been a substantial success, helping to restore stability to the financial system and to end the freefall in housing and auto markets." And on the
Republicans who are using the TARP bailout (passed while George W. Bush was president) and the
What makes this all the more distressing for America's future is that crises are supposed to be learning opportunities. We reflect on what went wrong, how it happened and who most contributed to the disaster. But polls suggest that Americans are poised to elect politicians who stand against regulation and the stimulus.
This doesn't make sense. Voters should be rewarding the worldview that proved more successful and saved the day, otherwise the economic turmoil we barely avoided may soon be upon us again.
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2010 Elections: Place the Blame Where It Belongs | Politics