In the battle for hope, it’s no surprise that President Barack Obama has gained the highest ground. “The private sector is doing fine,” the president intoned in June. That phrase was immediately controversial, but it had the rare distinction of sounding even worse in context than standing alone. Obama’s real concern was for government employees facing “cuts initiated by, you know, governors or mayors who are not getting the kind of help that they have in the past from the federal government.”
So is economic health returning? The short answer, writes Tim Cavanaugh, is no. The long answer is also no. The mortgage crisis has become so grave that some city governments are threatening to deploy their eminent domain powers to seize loans at high risk of default. Seven municipal governments, including three of the 50 largest cities in California, have declared bankruptcy. Wealth creation in America has become so difficult, and wealth destruction so common, that in many respects the recovery, which is not a recovery at all but a period of indefinite stagnation, has become worse than the “Great Recession” that allegedly ended in 2009.