Cast your mind back to the heady days of the giant Obama-era “stimulus package” following the financial crisis of 2008. New York Times columnist Paul Krugman—the great advocate of ultra-Keynesian big-government spending—assured us that the only problem with the nearly trillion dollars of pork-barrel spending was that it wasn’t big enough. What we really needed to get the job done was $2 trillion in stimulus. It seemed like madness.
Now this madness is the conventional wisdom embraced by both parties, because a $2 trillion stimulus is exactly what they just joined together to vote for, and their only disagreement was over the details of who and what should get stimulated.
We should remember that all of that stimulus back in 2009 didn’t really stimulate anything. For years, we kept hearing predictions about a “recovery summer,” a sharp rebound that never really happened. The recovery came, but only slowly and tortuously as banks and other big financial institutions rebuilt the capital they had lost in the real-estate crash.
This current stimulus looks like another attempt to throw cash around in random directions rather than solving the underlying problem.
Read the rest at The Bulwark.