From today's (8/3/10) WSJ. Robert Reich was the Secretary of Labor under Bill Clinton, and a good Keynesian. Note his assessment of the economy's current problem, and of what the government should do about it.
EXCERPTS:
"Consider the stimulus package.... Real GDP is now increasing at an annual rate of 2.4%, and although the recovery is still fragile it's unlikely we'll fall back into a full-fledged recession. Yet the official rate of unemployment remains above 9%, not including millions either too discouraged to look for work or working part-time when they'd rather have full-time jobs. Almost half of the jobless have been without work for more than six months, a level not seen since the Great Depression.
The central problem continues to be inadequate aggregate demand. The administration's original sin was not spending enough and focusing the stimulus more directly on job creation.
In fairness, no one knew how sick the economy was in February 2009 when Congress approved the initial stimulus. Yet by late spring 2009 the White House knew the extent of the damage and should have pushed much harder for significantly more spending....
