China and its Discontents

Brooks is Wrong – Consumer Confidence is High

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As an addendum to last night’s post on David Brooks misguided op-ed, Ezra Klein and Ryan Avent point out that contrary to this sentiment:

“in times like these, deficit spending to pump up the economy doesn’t make consumers feel more confident; it makes them feel more insecure because they see a political system out of control.”

Consumer confidence is actually at an all time high. I really liked how Ezra Klein put it:

Now, it may be that the deficit itself scares people even as the deficit-driven economic recovery is making them confident. But that just goes to the question of whether you’d prefer to have people worried about a deficit that’s actually not a major problem or an unnecessarily deep recession that actually is a major problem.

This gets back to what I said last night – do we worry about some phantom fears of deficit or turn our attention to quantifiable worries?

Written by Will

June 11th, 2010 at 6:37 pm