[quote]…and fiscal responsibility is a virtue we’ll need to relearn as soon as this crisis is past.[/quote]
Here is the bitch of it all. Economists expect Government to act like buisness, but in reverse. Be careful in the times of good, but careless/magnamamus in times of crisis. This is so far out of the relm of possibilty for human behaviour it is funny.
The basic idea is pump priming. When the pump isnt running, you inject alittle gas into it and get it turning over. As it turns over, it is easier and easier for the motor to run, allowing it to turn faster and faster and soon you have a running pump spewing properity for all.
The problem is that people are dependent upon that injected gasoline “priming” and dont want that cut off (annual deficits). As it adds alittle bit more to the pump output, pollitically it is very unpopular to reduce the prosperty flow because lets be honest, there will never be enough. So we keep priming and priming away until the day when the pump falls apart (which it will no matter what). We fix the pump (recession/bankruptcy), but since we have never stopped priming we have nothing left to get it running again properly. So we have to manually start pumping in gas by bailing out wall street/industry, but inevitably spill it all over and mostly just catch the whole pump on fire (think gas prices 4 months ago, housing prices 4 years ago). Now we have a poorly functioning pump on fire and are running outa gasoline because we used it all up “priming” during the good times.
Welcome to where we are now. the pump is on fire, the properity flow is faltering, no one knows how much gas is left (when will the dollar fall apart) and yet we have screams for more gasoline because the propserty flow is decreasing.
Basically pump priming only works if we stop priming when the pump is functioning, and that never happens.
Oh, and when is the crisis past? The last “offical” recession lasted about 7 months in 2001, but employment only really started to improve in 2003 or so. Remember the whole “jobless recovery”. In 2003 we were WELL on our way to the crap storm we are now in. So when is the crisis past? When will it be politically ok to cut peoples jobs?
The theory is sound, but it is not a good one when used in the real world. Politics and human behavior dont work that well. Who hears all the calls to conserve gas now that it is 2.20/gal? We as humans are great at dealing with the crisis at hand but suck at avoiding the crisis in the future. This plan only works if we think long term, and who here thinks our federal officials (with our votes) are good at that?
