While the recession has at least bottomed out and appears technically to have ended, the recovery, by historic standards, has been anemic. Within two years of the start of every one of the three previous recessions, GDP had rebounded significantly—to 4 percentage points above where it was when the downturn began. But 31 months after the start of the current recession, GDP was still below its starting point. The employment situation is even worse. In the nasty recession of 1981-82, the economy had regained the jobs it lost within just 26 months. This time around, we still have 5 percent fewer jobs than at the recession's start in December 2007.
What bothers the public, plain and simple, is that the steps that were taken to mitigate the recession—which involved greater government involvement, including ownership of the largest auto and insurance companies, and vastly more federal spending—have not worked.
Worse, the public believes federal action was especially unhelpful to the mass of Americans. Only 27 percent of respondents to a Pew Research Center/National Journal survey in July agreed that "government economic policies have helped [the] middle class." A poll in June by Greenberg Quinlan Rosner Research for Democracy Corps, a Democratic organization, asked American adults to choose between two statements:
1: President Obama's economic policies helped avert an even worse crisis and are laying the foundation for our eventual recovery.
or
2 : President Obama's economic policies have run up a record federal deficit while failing to end the recession or slow job losses.
By 49 percent to 44 percent, respondents chose Statement No. 2, and for those who identified themselves as independents, the margin was 52-38. Among independents, the results for backing a statement "strongly" were 42 percent for No. 2 and just 22 percent for No. 1.
Some politicians and economists, notably
Paul Krugman of Princeton and the New York Timesop-ed page, have argued that the persistent sluggishness of the economy is the result of not doing enough. Again, the public disagrees. As Jodie Allen of Pew wrote about her organization's study: "Far from demanding that the government reinforce its efforts so as to help neglected middle and lower-income groups, a majority of the public views cutting the federal budget deficit as more important than stimulating the economy." In June 2009, Pew found that, by 48 percent to 46 percent, Americans favored "spending more to help [the] recovery" over "reducing the budget deficit." But in July 2010, deficit-cutting was favored over spending by an 11-point margin, 51-40.
The Failure of the Liberal Economic Experiment? - WSJ.com
