Free Markets, Free People

Government: Always Late To The Recession

How does one demonstrate that if left alone, the economy will recover from a recession without government intervention?

Charts like this are helpful:

Quite a track record.

Quite a track record.

As Nick Gillespie says, if the chart is true, we must be beginning the recovery. Of course the larger point is, economies do recover without intervention and, in many cases, intervention comes as too late.

What it does, however, is give politicians a means of claiming credit for something that was already underway. And, as is obvious, putting you in debt up to your ears is fine with them if it buys them another 2, 4 or 6 years.


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4 Responses to Government: Always Late To The Recession

  • Except in this case the intervention will destroy any recovery. In eighteen to twenty four months we will begin to see the huge inflation and the inevitable rise in commodity prices.  This will be a huge failure according to everything I have ever learned and witnessed in my life.  If it instead produces a booming economy without high inflation and high energy prices then I will throw away all my history and economics books and become a democrat.

  • Devil’s Advocate:

    This is true assuming we are dealing with a nasty recession rather than a depression. That said, some are calling this a d-process (deliveraging) and that’s different altogether.

    Re: inflation, while personally I bought some TIPS, I have to say that once the inflationary pressure comes, the fed can raise interest rates…I mean we’re at close to zero so there’s some room. I think I’d rather fight inflation than deflation if I were in charge (thank God I am not.)

    Devil’s advocate off.