Mike Konczal week at Hold Fast continues…
We have a genuine, full-blown demand crisis on our hands. But our neoliberal policy advisors are looking to provide confidence to the bond market and are telling the unemployed to start taking night classes to get us out of this mess. Economic policy has conceptually been surrendered to the right, and now the Democratic administration is just arguing over how generous to be when it comes to supply-side interventions.
On the other hand, liberals know that demand needs to get moving in order to get our economy working again, and it needs to fire on all cylinders: stimulus in the form of public works and job programs, monetary policy in the form of QE3, and the writing down of bad debt. And it matters for politics – as Doug Henwood writes, recessions are better for the right than for the left.
I’m not an academic and don’t have much to add other than I think Konczal is right and there are meaningful policy differences between neoliberals and liberals. You might think that this is not be much of a statement and normally you’d be right. But there’s been a big, wonky debate the last few days on blogs and on Twitter about this.