Summers: ‘Excess of Fear’ Must be Broken
Now they tell us:
President Barack Obama‘s top economic adviser said Friday the nation’s economic crisis has led to an “excess of fear” among Americans that must be broken to reverse the downturn. National Economic Council Director Lawrence Summers said consumer spending seems to have stabilized in an encouraging sign, but he also suggested it was still too early to predict the timing of an economic turnaround. In the meantime, he told a forum, a problem has been that “fear begets fear.”
[…]
Summers was asked by a member of the audience what the nation’s business community could do to help speed the recovery.
“What we need today is more optimism and more confidence,” Summers said. “Those who have sound long-term strategy, who have investments that they want to make, who see productive opportunities, are going to find this a very good moment to make those investments,” he said. “There are a very large number of things that are on sale today. Think about the cost of doing construction today, versus the cost of doing construction two years ago.
He’s right, of course. Trouble is, his boss helped create said excess.
No, I’m not blaming the global financial meltdown on Obama. It began before he took office and he doesn’t even have his team in place yet. But he’s certainly contributed to the climate of fear over the last several months.
Summers’ full remarks are available at WSJ in text form and at Brookings in audio.
Photo: Brookings
But he almost did…a few times.
Correction, James; Years. He’s spent the last two years, about, downtalking the economy. Insofar as that and his voting record in the Senate, yes, he deserves blame. Decidedly so.
Citation Needed. How did you quantify this?
Never waste a good crisis. We must re-engineer this society while they are scared. Whar Alinski’s rules for a situation like this?
Who are “they” that you are referring to? Obama’s been in office, what, 50 days now. Wasn’t it the Bush admin that declared an economic emergency and McCain who put his campaign on hold so he could deal with this dire emergency?
Personally, I thought “they” were embellishing a bad situation to help get their guy in office. However, for the “they” I am referring to – it did not work.
Exactly what has Obama dome to create this excess fear?
It can not be to create fears that we can not get foreign capital to finance the deficit since the dollar is soaring.
I would love to see a specific example.
Repeated talk during the campaign and since the election of the most serious economic crisis since the Great Depression when that wasn’t the case. It’s the most serious financial crisis not the most serious economic crisis.
True, he was out there telling us the truth while Bush and McCain were insisting everything was sunshine and roses…
Link, Link, Link, Link, Link
Basically the message, for some time, was, “If you don’t pass this bill the economy will go from crisis to catastrophe.” Or to put it another way, the economy is in very bad shape and massive stimulus is needed.
James, sometimes when you are flat wrong, you should just stop rolling in it.
Yeah, like that there. I mean WTF, at this point you acknowledge a serious problem. Yes, it has sentiment as a component.
But … because you didn’t want “the problem” to be mentioned in The Olde Days, you’ve built a strange and contorted position. Obama should have dealt with this serious problem, while never actually mentioning that it was serious!
No. It was the worst-since, but you got your panties in a knot because you interpreted that to mean “as bad as.”
Shorter answer:
When you said this wasn’t the worst-since the Great Depression, you were wrong.
Your psychotic defense seems to be that at that point time, Obama should have been wrong with you.
Technically this remains to be seen. I think it is fair to say it could very well be the worst since WWII, but we don’t know that yet.
Oh, and you might want to be careful on calling others psychotic after posting 3 spittle flying comments in a row.
Righteous Indignation, Steve. Of course the strongest force in The Internets is one man’s Righteous Indignation feeding upon anothers’.
But in terms of what remains to be seen …
Yes, there is an important difference between “worst since” and “as bad as.”
Steve,
James made the claim that Obama “contributed to the climate of fear.” In order for this to be true, it must be demonstrated that, but for Obama, people would think the economy is in better shape than they current believe. That is what has not been quantified.
I think the high point in fear was still the Paulson quote:
Funny how James and Dave chase Obama when they’ve got that gold-standard to compare against.
odo –
I’m not sure what your argument is. As we sit here today, the most likely outcome of the current situation is a 1975 – 1981 style recession. Perhaps a bit worse. I (and Steve, who you are sparring with) have repeatedly said: “This is not a crisis,” “this is not a catastrophe” but a good firm recession.
Where is the dispute? I (and I believe Steve – but I do not want to place words in his mouth) have repeatedly said that the descriptions of “crisis” and “potential catastrophe” were ill advised. That’s all.
It seems to me the problem is that anyone under the age of 50 (or non-economists)only remember the 2001 and 1991 recessions. They were mild. If that is your frame of reference, then, yes, the current situation seems a “catastrophe.” Especially when media fueled. But those people are ignorant of history, especially the media.
For experienced (wiser?) people, or economists, one would look at 1958, 1975 or 1981 and say: “our current situation, based upon everything we know today, is basically similar.”
So relax.
Now. If Team Obama uck-fay up-yays this…….
This stimulus package was a joke. Multipliers, schmultipliers. This was pork ridden enough to take the spending multiplier below 1. And his tax designs are a joke. I didn’t even mention ridiculous green spending and regulation. He could turn it down……….he really, really could.
But I know in 2012 Kieth Olberman will still be spewing spittle onto the microphone crying for Cheney’s war trials and blaming Bush for the economy. I understand him, he’s psychotic and media driven.
You?
Ah, well, when McCain said a similar bit of sunshine when things were better than they are now the new guy ripped him a new one..but you remember that. Then the new guy says “we gotta stimulate or this mo-fo will implode” and then yesterday/today he trots out the “hey…this ain’t that bad, dunno what we were thinkin'”. So yeah, he’s got truth surrounded.
500,000 lost jobs a week incites fear.
40 to 50% loss of equity in the stock market incites fear.
Massive spending far beyond what anyone has ever seen because “we must spend our way out” incites fear.
Realization the much of the spending will not succeed in more than lining the pockets of the well-connected incites fear.
Large firms and small going under incites fear.
Loss of substantial equity in the homestead incites fear.
Always waiting for the next shoe to fall, and being told it surely will real soon now incites fear.
What is this idiot’s cure for fear?
Good parallel Drew. In 2012 will James and Dave be saying the economy tanked because Obama talked it down?
(My hot button here is that Obama told us something that proved true (“worst since”) and James etc. couldn’t bear it. They could have done a solid and unemotional article (as NPR did) on why “worst since” is not the same as “as bad as” but they didn’t. They did what seems, as you say, a psychotic and media driven blame game.)
But, wait a minute, I thought at this point we all would be luxuriating in the stupor of “hope and change.”
Did I miss something? Should I check ticketmaster to sign up for this concert or teleprompter speech?
Remember, boys and girls, ladies and gentlemen, and those of you who fall into neither category; “all we have to fear is fear itself.”(or dubious politicians)
Is that anything like the sunshine and roses that started this conversation out of Obama yesterday? His bail out plans have done nothing to solve the initial problems with the economy, and yet all of a sudden he’s also in the sunlight about the future of the economy. He’s clearly blowing sunshine.
Funny how you don’t mention that.
It’s interesting, how we were told yesterday that the banks were suddenly making some profit during the first quarter. How can this be? Wasn’t that profit occurring while Obama was telling us that we were all in the worst crisis of our lives? Now suddenly, everything’s been turned around?
The question apparently comes down to whether he’s lying to us now are he was lying to us then. Pick one.
I will pick both as far as his lying goes.
He wanted us to think a month or so ago that things were desperate. Get on board with me and we will ride “The Hope and Change Express” to good times in the sky.
After a month of “His Majesty’s rule,” he wants us to believe things are better because the Dems have spent us us into the biggest debt in history and he is in “control” at the Big House.
Hey, play it down, then do anything, and then talk it up. Old political Trick…It is as stale as a sour kraut fart.
Wonder when the right is going to condemn Cheney for talking up terror attacks…
I will go with what is behind door #3 – Bit is a blithering ninny 🙂