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Tuesday 10 August 2010

You Can’t Talk An Economy Up

One factor that did for Herbert Hoover, who was unfortunate enough to be President when the Great Crash of 1929 presaged the equally Great Depression, was his inability to confront the problem of that Depression: on too many occasions, he would talk of it in the past tense, pretend that it was over. When Franklin Roosevelt declared that he would commit himself to the problems of the Depression, it was little surprise that he was elected President in a landslide.

Hoover learned the hard way that the economy could not just be talked up. For many Democrats this time round, the bad news is that it looks as if some in their own party have not learnt that lesson. This was the central message coming from Arianna Huffington in an interview with Keith Olbermann on MSNBC’s Countdown yesterday evening.

Arianna – who, for those in the UK of a certain age, still sounds very much as she did all those years ago before she left for the USA – pointed out that there are some in the Obama Administration, such as Secretary Geithner, who are referring to the economic problems of the US in the past tense, as if all that is now past. Her conclusion is that this isn’t the case: for too many Americans, the hard times are right now.

For anyone in the Administration with any sense of history, the alarm bells should already be ringing. Because if the mindset of trying to talk up the economy does for Obama, the Republicans would have nothing else to offer – except perhaps more tax breaks for the very richest. In other words, throwing money at those who don’t need it, for very little economic benefit.

Not a comfortable thought – and it would affect the UK too, so we may do well to keep watch on proceedings.

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