This graph via the Atlantic illustrates the success our nation has had in combating the gyrations of our market . I question, though, whether this Keynesian "win" is a net positive for our nation in that the painful removal of fat, inefficiency, poor regulation, and poor governance are less likely to be forced from the system during unrealized market downturns.
How?
We have used Keynesianism to curb swings in the market. The result has been market stability and a commensurate lowering in the cost of gov. debt. This has the overt appearance of a positive, but has allowed for the accumulation of inefficiency.
This quest for stability has produced not only an economy that suffers from the accumulated gluttony of shallow downturns, but also governance that relies on the resultant cheap debt to avoid the hard choices of reconciling the fiscal incoherence of a citizenry desiring both increased gov. services and lower taxes.
This Keynesian born plaque thickens the ether through which our economy operates weakening corporations and increasing gov. debt until it becomes unsustainable.
Our current downturn in which we are bailing out banks and other weak corporations while straining our nation's ability to borrow, has revealed just how close to unsustainable our 70 year experiment in "gov. debting" away economic downturns has become.
Where once America produced trim and lean corporations that could lead globally, America now produces morbidly obese corporations addicted to government's Keynesian protection from market downturns. American Corporations have, in general, become weak and uncompetitive. Witness the bailed out as the most obvious.
Economies must be allowed to correct.
Do we truly expect jobs from this non competitive Keynesian fat burger?
H/T EdCone
end of rant
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