Quote for the Day--Double Dip Recession

"No one in their right mind would have wished for another Great Depression, of course. But we seem to have got the worst of all worlds. The bank bailout, the stimulus, and the Fed brought us back from the brink just enough to dampen zeal for anything more. As a result, we are now slouching toward a tepid recovery that could just as well fall into a double dip recession, while a large portion of our population suffers immensely."

--Robert Reich

Economic Double-Think

There's kind of a weird double-think involved in arguments that the slump should be allowed to follow its natural course. It's true that classical economics says that we should let market forces do their work; but classical economics also says that severe recessions can't happen. This idea that we must not intervene is based on a worldview that is refuted by the very fact that the economy is in the mess it's in.
--Paul Krugman

Quote of the Day

I’ve been ruminating over economic prospects for next year, and I’m getting scared.
--Paul Krugman

Economic Musings

I recently posted on former Clinton labor secretary Robert Reich's take on the economic downturn. I said that I didn't know nearly as much about economics as I'd like. I'm trying to remedy this, even if my progress is slow and painful.

One thing Reich said is something I've been thinking for a long time. The Republicans are about reducing taxes on the rich ostensibly so that they'll invest more in building the economy to benefit all of us. But it has long seemed to me, as it does to Reich, that putting more money in the accounts of people who already have more money than they can reasonably spend does little to grow an economy, especially if the rest of us can't afford, as increasingly appears to be the case, to buy the products and services generated by that economy. It seems to me that we need, through higher wages and other changes, to concentrate on putting more money in the hands of everyday consumers rather than in the hands of the obscenely wealthy.

What, if anything, is wrong with my (and Reich's) thinking about this, and if nothing is wrong with it, how might we actualize it?

Bangkok Bombing Update

Earlier today, I posted about the New Year's Eve bombings in Bangkok. I opined that they were probably the work of Muslim separatists taking their campaign of terrorism from the South to the very center of the nation. However, I've just read in the New York Times that Thai national police doubt that insurgents from the South were responsible. They believe or say they believe, instead, that the bombings were linked to the political unrest that lingers in the wake of the recent coup, and one fact that supports their suspicion is that all of the bombs exploded in areas not frequented by foreigners.

Am I too quick to atttibute virtually all terrorist acts these days to Muslim terrorism? Has my admitted distaste if not hatred for a religious faith that has spawned so much violence and misery with relatively little condemnation from Muslim communities at large taken unhealthy hold of me?

Maybe, but I'd still be surprised, although I'd love to be, if those bombings had anything to do with the recent coup and not with Muslim terrorists. I suspect that the Thai police may be engaging in some wishful thinking or damage control to keep the tourists coming and tourist money flowing into the economy.