NP: No gov't; best gov't..from John Lanchester LRoB

[David Morris]

http://www.washingtonmonthly.com/political-animal/2011_09/the_right_and_wrong_side_of_a031977.php

Media:
"If you listen to the establishment press the president’s speech will
determine whether the president listens to “liberals” and ditches the
move toward economic austerity or “moderates” and Republicans and
sticks to budget cutting."

Reality:
It’s important to realize how wrong this kind of media coverage is.

Economists and the financial industry want policymakers to boost the
economy. The bond market wants the government to be aggressive in
creating jobs. Wells Fargo lowered its growth projections recently,
and said conditions will get worse “without policy intervention.” The
conservative Financial Times argued the other day, “In broad terms,
the needed elements are plain: further short-term stimulus combined
with credible longer-term fiscal restraint.”

J.P. Morgan says “fiscal tightening” will worsen the “negative
feedback loop” hindering economic growth. Greg Ip notes, “A shift
toward fiscal and monetary austerity in the United States in 1937
helped prolong the depression. Fiscal tightening helped push Japan
back into recession in 1997.” Jared Bernstein argues for more
stimulus. Larry Summers, too. Bruce Bartlett, a policy advisor to
Ronald Reagan and Jack Kemp, writes, “the important thing is for
policy makers to stop obsessing about debt and focus instead on
raising aggregate demand.”

And this doesn’t even include warnings from the Federal Reserve and
the Congressional Budget Office that aggressive spending cuts would
weaken an already fragile economy.

We’re approaching an economic consensus among those who know what
they’re talking about. If President Obama pushes an ambitious jobs
agenda, he’ll be siding with economists, the financial industry,
business leaders, and even the Fed, not just those rascally
“liberals.” Republicans won’t like it, and apparently the
establishment media won’t either, but that’s the reality of the
situation.