Treasury Secretary Tim Geithner tells the G-8 that the green shoots showing up from Beijing to Baton Rouge are the result of government initiative:
Where we have seen improvements, they are the result of the unprecedented scope and intensity of policy actions to support demand and financial repair. The coordinated recovery programs set in motion in the context of the G-20 meetings helped stem the sharp erosion in business and consumer confidence and have begun to turn the global economy around.
The improvement in conditions is a tribute to the power of cooperation. Central banks moved together, helping to dampen liquidity pressures. Fiscal programs were more effective because they were done on a broad scale across the major economies.
Full speech here. Everybody knows the only way to fight flapdoodle like this is to ask the tough questions and post the answers on YouTube, but it would still be nice to see Geithner asked to make even a token effort at demonstrating either cause or effect. What are these improvements, other than a slight and still too-early-to-call slowing of the rate of economic decline? Have the zombie banks returned to life? Are all those buyers of U.S. Treasuries creating growth that is somehow stopping stagnation? Is there any reason, other than Geithner's assertion, to believe all this activity by central banks is building the economy on rock that we keep hearing about?
Lucky for us, Geithner has his toughest interlocutor right in the White House janitor's closet. Vice President Joe Biden today tried to do some ex-post-facto expectations managment around the useless American Reinvestment and Recovery Act, and even claimed that our old friend Everyone "guessed wrong" on unemployment numbers. (Oh really?)