Romer Points Out Failure Of Obanomics: Just Words

From her parting remarks, soon to be ex-chairman of Obama's Council of Economic Advisers, Christina Romer, you would think that it was what Obama and his economic team didn't know that hurt us. But that's not true.

As both her and Biden's remarks point out, they knew how bad it was. What they didn't know and still refuse to learn is that, Obanomics is a failure. It took up failed Keynesian economics, convinced that they could somehow do it better, or smarter. When does one not hear that from a liberal? Now, we've run into a ditch and they have no means of getting us out, even if one accepts their thinking. There isn't additional money to throw away and Congress has no intention of doing so. 

This was the case going in, unfortunately. But Obama was elected on media hype and image. It never did have anything to do with a solid economic plan to deal with America's troubles. In the end, it was, as Obama might say, just words.

She had no idea how bad the economic collapse would be. She still doesn't understand exactly why it was so bad. The response to the collapse was inadequate. And she doesn't have much of an idea about how to fix things.

What she did have was a binder full of scary descriptions and warnings, offered with a perma-smile and singsong delivery: "Terrible recession. . . . Incredibly searing. . . . Dramatically below trend. . . . Suffering terribly. . . . Risk of making high unemployment permanent. . . . Economic nightmare."

Romer had predicted that Obama's stimulus package would keep the unemployment rate at 8 percent or less; it is now 9.5 percent. One of her bosses, Vice President Biden, told Democrats in January that "you're going to see, come the spring, net increase in jobs every month." The economy lost 350,000 jobs in June and July.

Comments

[Al Gore (D-Sex Crazed Poodle and Instigator of Violence)]

If only I'd been elected in 2000.

[Lightwave]

Keynesian economics has failed this country for 80 years. They have resulted directly in two depressions now in that time period. Republicans who spent money we didn't have are responsible along with Democrats who did the same thing.

The stimulus did not help. All evidence points to it directly causing the slump in the economy we're seeing right now. If we had cut trillions in spending and let the failed banks go under, we would be in far better shape now as a result. Instead we gave rotgut booze to an alcoholic and lost eight million jobs.

Would have letting the economy "collapse" by Republicans stopping the Bush TARP mess and Obama's stimulus failure really have made things worse then where we are right now?

Why should we reward those Republicans with continued unemployment? Three trillion in wasted TARP and stimulus and Fed money has done precisely nothing best case, and worse case it is directly responsible for the economy.

Massive spending cuts are needed immediately. It's time to cut the wheat the chaff and start over.

[Neo]

Let's keep the Bush TARP, the Obama TARP extensions, and the Obama stimulus separate.
Study after study have shown that the Bush TARP worked and would have return every taxpayer dime if Obama hadn't perverted it to help the car industry.
The Obama/Pelosi/Reid "stimulus" (like the much smaller Bush/Pelosi/Reid stimulus of early 2008) were a worthless waste of sovereign credit.

[Lightwave]

I'd argue differently given that banks are still in trouble.

Of course, the reason they are in trouble is massive new regulatory chokeholds on profits.

[Anon]

Raise your hand if you knew that a) the stimulus would fail to deliver, b) the excuse given would be that it was too small. Isn't this the answer to almost all the progressive policy failures of the last 30 years---they fail not because they're misguided but because more money is needed, more government intervention and more controls. Same old same old.

I'm on the fence about TARP, I can see that doing nothing at all would have led to a massive stock market crash much worse than what we saw, but I do think that banks like Citi and others that in true fact are bankrupt should have had to write down their losses and declare bankruptcy, be organized and go forward.

I don't think the fed is going to make money on the MBS they purchased, at least not for several decades, though I can see how they thought this was a reasonable course of action, what their ability to print money and all.

I supported increased regulation of the financial industry but as far I can tell the new regulations are the typical worse case scenario, they increase costs, are ripe for loopholes and don't address the core problems too effectively.

[Jim Ryan]

SHE: Oh, my God. What's the matter?

HE: Honey, I.... I spent the money. All of it. Our life savings: $800,000. We're broke. We're even in debt $75,000 because I maxed out our cards.

SHE: What? What happened?

HE: I paid guys to dig holes and fill them in again. It was a money-making scheme and it didn't work, unexpectedly.

SHE:

HE: What? It made sense, it just didn't work for some reason.

SHE: