The memo that Larry Summers didn’t want Obama to see.
" ‘[Christine] Romer was frustrated that she wasn’t allowed to present an even larger option,’ suggesting that while the memo he obtained may have been the end of the story, it was far from the whole story. … In [an early] version of the memo, Romer calculated that it would take an eye-popping $1.7-to-$1.8 trillion to fill the entire hole in the economy—the ‘output gap,’ in economist-speak. … Alas, these words never made it into the memo the president saw.”
Noam Scheiber, “The Memo that Larry Summers Didn’t Want Obama to See”
Photo courtesy of Getty Images.
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The memo that Larry Summers didn’t want Obama to see.

" ‘[Christine] Romer was frustrated that she wasn’t allowed to present an even larger option,’ suggesting that while the memo he obtained may have been the end of the story, it was far from the whole story. … In [an early] version of the memo, Romer calculated that it would take an eye-popping $1.7-to-$1.8 trillion to fill the entire hole in the economy—the ‘output gap,’ in economist-speak. … Alas, these words never made it into the memo the president saw.”

Noam Scheiber, “The Memo that Larry Summers Didn’t Want Obama to See

Photo courtesy of Getty Images.

Has the recession hurled African-Americans backwards in time?

"There came a time when, after the twin pressures of the Great Migration from the rural South to northern cities and civil rights movement of the 1960s, blacks were able to enter jobs, schools, and neighborhoods previously denied them and began the slow crawl toward closing the gap. By the turn of the twenty-first century, it had narrowed significantly—although white Americans still had a median net worth ten times that of black Americans. Then came the Great Recession, which wiped out the precarious gains that had been made and hurled African Americans back to the lowest point since economists began measuring the wealth gap three decades earlier."

—Isabel Wilkerson, “Race to the Bottom

Obama’s brush with political disaster.
Read an excerpt from Senior Editor Noam Scheiber’s upcoming book, The Escape Artists: How Obama’s Team Fumbled the Recovery.
"For the better part of the next four months, the administration would be mired in painstaking negotiations with Republicans over a series of dead-end deficit deals, even as the economy teetered on the edge of a second recession. It would prove to be a damaging experience for Team Obama and a window onto the administration’s self-sabotaging obsession with deficits. Above all, it would expose Obama’s greatest vulnerability as a leader."
—Noam Scheiber, “Obama’s Worst Year: The inside story of his brush with political disaster.”
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Obama’s brush with political disaster.

Read an excerpt from Senior Editor Noam Scheiber’s upcoming book, The Escape Artists: How Obama’s Team Fumbled the Recovery.

"For the better part of the next four months, the administration would be mired in painstaking negotiations with Republicans over a series of dead-end deficit deals, even as the economy teetered on the edge of a second recession. It would prove to be a damaging experience for Team Obama and a window onto the administration’s self-sabotaging obsession with deficits. Above all, it would expose Obama’s greatest vulnerability as a leader."

—Noam Scheiber, “Obama’s Worst Year: The inside story of his brush with political disaster.

Is there a reason to be optimistic about the economy again?

"Once again, today’s biggest political news isn’t about the Republican candidates or the President, even though the former are battling in Florida and the latter is about to give the State of the Union address. It’s the latest Gallup survey, which shows economic confidence has risen sharply since August and is now at levels not seen since May. That report is consistent with the latest ABC News/Washington Post poll, in which confidence in the economy reaches its highest rate in months.”

— Johnathan Cohn, “Biggest Political News of the Day

For continued analysis of political and economic news, turn daily to TNR Senior Editor Jonathan Cohn’s blog and of TNR’s 2012 campaign blog, the Stump.

Photo courtesy of Gallup.

A recovery or another headfake?

Is this an economic recovery actually worthy of its name?

"There have certainly been several headfakes before (remember ‘green shoots’ and ‘Recovery Summer’), but, to borrow a dangerous phrase, this time might be different. Economic data has surprised on the upside for the past few months, and the December jobs report continued this positive trend. The headline unemployment rate fell to 8.5 percent on 200,000 net jobs added in the month—which, while not a fast enough pace to bring down unemployment to pre-recession levels till the mid 2020s, still represents a substantial acceleration over the past year."

- Matt O’Brien, “A Recovery, Or Another Headfake?

Also, be sure to check out TNR Senior Editor Timothy Noah’s blog, where he takes on the odd contention that all white working class voters are Republican.

Photo courtesy of Alaska in Pictures.

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"Let’s Be Honest: We’re in a Depression, Not a Recession"

"What can be done now? Probably nothing. Anything that involves spending, such as a new stimulus program, would come too late to be effective… At a 7 percent annual growth rate, our public debt in 2012, estimated at $12.4 trillion, will grow by 40 percent in five years if none of the reforms designed to limit that growth are implemented before the end of that period. Yet if they are implemented while the economy is still struggling, the result may actually be to increase the deficit by driving tax revenues down… The result is a quandary. I don’t see a way out of it. I hope others do."

A contribution to “A TNR Symposium On The Economy" by Richard A. Posner, a judge on the U.S. Court of Appeals for the Seventh Circuit and a senior lecturer at the University of Chicago Law

Here at the blog formerly known as Citizen Cohn, we bring you the bad news as well as the good. And so we must draw your attention to the latest state-by-state statistics on unemployment — and, specifically, the unemployment rate in Michigan. It’s up to 10.9 percent, the third consecutive month that it’s risen. The story seems to be the same across the Great Lakes region.

The precipitous drop in unemployment in this part of the country has been one of the better, if under-appreciated, economic stories of the last year — testimony to a rebound in the manufacturing sector bolstered, in part, by the government’s rescue of General Motors and Chrysler. And, for the record, the situation is still markedly better than a year ago, when unemployment in Michigan was 12.4 percent. But this is obviously sobering news — and a reminder that the economy needs a lot of help.