Friday, June 10, 2011

Reality Check for Pawlenty

http://krugman.blogs.nytimes.com/2011/06/10/why-i-dont-believe-in-the-american-people/

June 10, 2011, 4:40 PM
Paul Krugman

Tim Pawlenty — who has turned out to be a much bigger fool than I or, I think, anyone imagined — replies to criticism of his claim that he can get 10 years of GDP growth at 5 percent:

Obama’s economic team doesn’t have a plan, so their spokespeople attack ours. The idea that they don’t believe in the American people enough to say that we can grow the economy at 5% GDP really says everything. You have to wonder if in fact Obama’s grand plan is that we don’t grow at all — and if so — he and the central planners are doing a great job of that.
Well, here are 10-year growth rates starting with 1929-39:

[see article for chart]

Except for the big jump from the depths of the Great Depression to the height of World War II, we have never had a decade of growth at 5%.

What’s also notable in this figure is the invisibility of all the supposed economic miracles we hear about. Saint Reagan was supposed to have revitalized the economy; can’t see it here. All you can really see is that the 60s were very good, and the recent slump has been very, very bad.

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