A crisis is a terrible thing to waste

In Getting Away with It, Paul Krugman and Robin Wells discuss three books about President Barack Obama, the Democrats, the Republicans and the global economic crisis.

It's not an uplifting story, but it is a necessary one.

"But while the economy now may bear a strong resemblance to that of the 1930s, the political scene does not, because neither the Democrats nor the Republicans are what once they were. Coming into the Obama presidency, much of the Democratic Party was close to, one might almost say captured by, the very financial interests that brought on the crisis; and as the Booker and Clinton incidents showed, some of the party still is. Meanwhile, Republicans have become extremists in a way they weren’t three generations ago; contrast the total opposition Obama has faced on economic issues with the fact that most Republicans in Congress voted for, not against, FDR’s crowning achievement, the Social Security Act of 1935.

These changes in America’s political parties explain both why there has been no second New Deal and why the policy response to the prolonged economic slump has been so inadequate."

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"Obama’s innate centrism led him to adopt the preoccupation with the budget deficit of Geithner and Peter Orszag (his head of the Office of Management and Budget and another Rubin protégé) in opposition to vocal protests from both Summers and Romer that now was not the time to worry about deficits. As a result, Obama would never acknowledge that the original stimulus was not big enough, a position that left him boxed in when it became clear—as it already had by summer of 2010, if not earlier—that it had indeed been far too small."