Wednesday, October 8, 2008

Depression fears

Lee Ohanian gets it, but has not yet quited figured out the importance of what it means:
Will we duck a depression? We will if the principles of economic growth -- increasing the incentives to work and save, promoting competition, and fostering economic openness -- are maintained. This is the most important lesson we learned, the hard way, from the 1930s.

I agree with that, but the problem is he said this earlier in his article:
...there is a real danger that even a moderate recession, along with the current perception of an economic crisis, would lead to calls from various quarters for bad economic policies -- policies that tend to either pander to special-interest groups, benefiting relatively few at the expense of many, or raising taxes, particularly on the nation's most productive citizens, many of whom create jobs through their own enterprises.

Well, the Democratic Party is on the verge of a possible electoral landslide, and they are the party that is more likely to "pander to special-interest groups, benefiting relatively few at the expense of many, or raising taxes, particularly on the nation's most productive citizens, many of whom create jobs through their own enterprises". Lee Ohanian has yet to put these facts together to see how perilously close we are to the next depression.