Shorter Paul Blustein (some knucklehead writing in the
Washington Post today):
We must stop moves towards protectionism because of the experience Smoot-Hawley has taught us:Failure to freely trade with Europe and Asia in the 1930's meant that we had to wait until World War II to get out of the Depression, through expanded government spending and vigorous trade with countries like Germany and Japan.
Wait a minute, how much low-tariff trade was there during World War II? Hardly any. Oh well, may as well pretend that tariffs are bad since free trade continues to weaken labor, and that will get me printed in the Washington Post.
posted by Quiddity at 12/07/2008 04:26:00 AM
Thanks for bringing this up. There are a sorts of questions and answers in this observation.
There was government spending during the New Deal (the WPA to name just one program) as an attempt to pull the country out of the depression but it wasn't enough. It took the massive spending for the war that did the trick. So, one would ask, why hasn't spending on Iraq benefitted the economy. It should have but a lot of the money went was spent in other countries like China. And, yes it did boost the Chinese economy.
I think that we need massive spending from Obama on infrastructure (Most will be spend here but remember Bush gave a Mexican oligarch a monopoly on our cement.) His green program is also an infrastructure program. You might as well throw the auto industry bailout in there as another infusion program. Now, if he can only get the banks to use some of the $200 to 300 billion they got to make loans, this whole thing might work.
