I read something like this, and begin to fear for the entire field of economics. I possess the growing suspicion that the entire economic modeling process has like the Income Tax, become so riddled with Exceptions, that a valid Reading can hardly be found. We are supposed to be powering out of the last Recession, but Why is Production still below par, and Unemployment at such height? I can answer the later Question myself, but where is the failure to achieve Production levels consistent with the modeling? It reminds of the CPI, I wondering what is the Inflation rate on the thrown-out, volatile elements like Fuel and Food, and How much does the Two constitute in the total performance of the economy. Remember, any worth must show the progression over a decade at least, so no false fiddling with that stats.
Paul Krugman does not agree with me, but hell, I don’t even agree with God most of the time. He would choose to ignore all the indications of Inflation–in imitation of the Fed. Still, he would probably be the last to advance real stats on how much Household Income has be absorbed by the inflation of those volatile elements which Households so often have to purchase. I would like to know if this absorption is interrupting Intermediate and Long-Term Goods purchases–which Everyone knows that they are–but not by How Much? I am not trying to be mean to Paul Krugman or any other economists; it simply stands that We must get uncorrupted information to base sound economic decisions, and the models don’t lie unless the modelers have something to hide. We need a profundity of accuracy in this business, and We are giving an excess of garbage.
Here is an Outline of what I am beginning to fear, and it remains a valid deterrent to economic expansion. Conservatives have captured State Legislatures and Congress, and all insist on Tax Cuts, continued Government Spending on profitable projects for Business and Corporation, and limiting both Welfare and Government employment. It is incredibly foolish for Anyone to expect that the economy will improve under conditions where the Wealthy get the Welfare, and the Poor gain in both Population and Need. A Day of Reckoning will come, and it will basically consist of Interest rate going up again, and our Collective Debt generated by Tax Cuts without reason will finally destroy our economic position. My Conservative fellow Citizens do not understand that their positions will collapse long before the U.S. Government, but both can and will collapse. lgl