The Washington Post is out with yet another Amity Shlaes piece today claiming that the New Deal was a big failure. I won’t analyze the piece itself, since I am not an economist, but I will revisit a piece she wrote last July, titled, auspiciously enough, “Phil Gramm Was Right”:
Consider what happened this week. While speaking with the Washington Times, Gramm said that the country was not in a true recession but a “mental recession.” He also said, “We have sort of become a nation of whiners” and “You just hear this constant whining, complaining about a loss of competitiveness, America in decline.”
Gramm was right about the recession and stood by his recession comments on Thursday. A recession is two consecutive quarters in which the economy shrinks, and last quarter it grew. But no matter. Voters feel they are in a recession, and so they are, at least according to Campaign Econ.
I wonder why voters thought we were in recession last July? Is it because they are ill-informed whiners? Oh, that’s right, it’s because we were in recession last July and had been been for seven months:
It took seven economists 11 months to decide what should seem obvious given all the foreclosures, bank failures and layoffs – the United States is officially mired in a recession.
Still, Monday’s declaration by the National Bureau of Economic Research that the economy has been in retreat since last December (2007) sent Wall Street into a bearish fit that knocked nearly 9 percent off the S&P 500 index.
The pronouncement by a committee of academics led by Stanford economist Robert Hall should have come as no surprise.
“We’ve been saying the economy has been in recession for months now,” said economist Brian Bethune of IHS Global Insight, a Boston consulting firm.
Obviously, no one could have anticipated that we were in a recession this summer, no one other than 71% of economists surveyed in March 2008, anyway.
Why on earth does the Washington Post see fit to publish a pseudo-economist who was completely wrong about the big economic issue of the year? It’s probably the same reason, of course, that they exclusively (except for Meyerson) publish columnists who were completely wrong about the Iraq war. Or maybe it’s just because Fred Hiatt is such an influential liberal.