Obama’s Economic Illiteracy, Not S&P, Is Causing the Market Meltdown

OK, so the title of this posting (“Obama’s Economic Illiteracy …”) is misleading, but only in the sense that it is not Obama’s economic illiteracy alone. He shares it with most of the policymakers in Washington, D.C., who have just implemented an insane austerity program on top of our shrinking economy. This is nuts.

The incredible thing, though, is that — judging by polling — the majority of American people are not nuts, are not economically illiterate. By significant margins, they are calling for all the right remedies: ending tax cuts for the rich, a massive jobs program, more government spending, protecting Social Security and Medicare, and cutting military spending.

Imagine that! The classic Keynesian remedy has soaked into the psyche of the average American, but still hasn’t reached the policymakers in D.C.

Guess who else isn’t economically illiterate?

Answer: Investors in the stock market. This is why Obama’s attempt to deliver reassurance only aggravated the meltdown. He is correctly seen as not addressing the real problem with a real solution. There’s no functional difference between being economically illiterate, on the one hand, and being economically savvy but in  the thrall of economic illiterates on the other. I leave it to you to decide which of those two statements describes Obama. I’m losing interest in the distinction.

Here are two commenters from the Roosevelt Institute  — Tom Ferguson and Rob Johnson — who have the same criticism of Obama, but their language is even more severe than my own.

And both believe that Obama’s prospects for re-election in 2012 are growing seriously dimmer.

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