Oh, For Goodness Sake

Government Intervention Averted Depression

In New Study, Two Economists Argue That Bush And Obama’s Intervention Prevented Depression

So has the Obama economic program been working? While the economy certainly continues to have problems, the Obama administration — and some members of the Bush administration — have consistently argued that things would have been worse without their intervention. And now, two economists have published a study arguing in favor of that very idea, saying that there’s quantitative evidence that the interventions of the Obama and Bush administrations helped avert a depression.

As the New York Times reports, a new economic paper from Princeton professor and former Fed vice chair Alan S. Blinder and Moody’s chief economist Mark Zandi argues that the combination of financial reforms such as TARP, bank stress tests and emergency lending by the Fed, plus the stimulus, have indeed saved the economy from far worse problems.

The report also finds that while the financial reforms alone would have been been stronger than the stimulus alone, the whole is not directly comparable to the sum of the parts in isolation, “because the policies tend to reinforce each other.”

TPMDC