I have finally been able to get the video of Rep. Schakowsky talking about her bill.
I referred to this bill in the previous post, Representative Jan Schakowsky Introduces Plan to Create 2.2 Million Jobs.
Brad DeLong’s article Department of “Huh?!”: Labor Market Demand and Supply for the Elderly Edition has some comments that are particularly relevant to my previous blog post The Return Of Depression Economics.
DeLong said:
The old Keynesian line was that nominal wage flexibility–and the union-smashing recommended by Hayekians–was a side issue. In an economy with nominal debt contracts downward-flexible nominal wages were likely to produce deeper depressions as the economy was subjected to much stronger downward shocks from the deflation, debt, and bankruptcy cattle prod. Wage inertia was thus a blessing–albeit a poorly-understood blessing–rather than a curse.
I think that everybody open-minded and nuanced is finding themselves moving rapidly toward the old Keynesian position under the pressure of events and data right now.
Compare this to the quote that I pulled out of Paul Krugman’s book The Return Of Depression Economics.
In reality prices don’t fall quickly in the face of the recession, but economists have been unable to agree about exactly why.
On August 10, I took Krugman to task for pretending that economists could not agree on the obvious cause. I said:
Could it be that the need for homeowners to sell their houses at above market value to be able to pay off their mortgages kept them from lowering the prices right away in the forlorn hope that they could come out of the deal financially whole?
If you translate the economics jargon, Brad DeLong is saying the same thing.
It may not have much to do with my particular point in this blog post, but I want to keep track of the following graph from DeLong’s article.
Dean Baker is the author of the article President Obama Joins the Cult of Economics Deniers published in Nation of Change. He says:
But, President Obama is apparently not listening to economists anymore, so he wouldn’t care in any case. Just as we have many politicians who ignore climatologists in the design of energy policy, and politicians who think that biology has no place in teaching the origins of species, we now have politicians who think that economics has no place in designing economic policy.
I guess President Obama has gotten weary of occupying his position in the reality based community and has decided to make up his own set of facts. It worked for George Bush, why not for Obama?
I go even further than Cenk Uygur in the above video.
What I complain about is Obama’s complete lack of effort to defend my principles. Even if he still lost, he would have made a good, strong case for my principles. Eventually the point might start to sink in with the public, 80% of whom already agree with the point that Obama should be making. If Obama can’t rally 80% of the public, what kind of a leader is he?
What we are discovering, though, is that Obama and his minions don’t believe in the principles I think he should be fighting for. The point that Dennis Kucinich has made is that Obama is not really losing his battles since Obama is really more on the side of the Republicans than we could have believed when we elected him.