Economic Expansion and the Angry Bears
Was Greg Kaza talking about us?
Throughout 2002 and 2003, partisan critics of the Bush tax cuts repeatedly attacked this fiscal stimulus, and suggested that economic calamity would follow the mild, eight-month-long recession which greeted the new millennium. Such pessimism, typically reduced to a sound bite or a slogan, was 180 degrees off the mark.
Kaza must not have read WHY Angrybear began this blog. AB (like most economists) would tell you that recessions are typically followed by recoveries – with or without fiscal stimulus especially when monetary policy aggressively lowers interest rates to stimulate investment demand. The monetary expansion did encourage residential investment, but alas investment demand was slow to reverse its slide.
Had Kaza been paying any attention to what AB, Kash, and I have been writing is that we have been surprised at how long it has taken the economy to recover. One clear problem area was the weak export demand. And my thesis has typically been (pardon me for sounding like Robert Rubin) that the backwards nature of the fiscal policy – short on short-term stimulus and long on long-term fiscal irresponsibility – has short of spooked Wall Street.
If Kaza wants to use the name of our blog – could he at least have the courtesy of not misrepresenting what we Angrybears have been saying?