Oh!pinion

As surely as Republicans and tea party types want people to focus on the federal deficit and high unemployment instead of why both got so high, those pols are saying plenty about business bailouts and the federal stimulus being wasteful and ineffective.

But as Columnist Froma Harrop explains, two well-qualified economists who’ve actually studied the Obama administration’s economic disaster response and its results say it has been a life saver.

Using econometric models, Alan Blinder and Mark Zandi argue that the bailouts, the stimulus and other extraordinary actions saved America from nothing less than another Great Depression. Blinder was vice chairman of the Federal Reserve. Zandi is chief economist at Moody’s Analytics and advised Republican presidential candidate John McCain.

Had Washington not taken any aggressive steps starting in 2008, the results would have been horrific, their study says. Real gross domestic product would have fallen a “stunning” 12 percent, rather than the actual decline of 4 percent. Nearly 17 million jobs would have vanished, twice as many as the real count. And the unemployment rate would have peaked at 16.5 percent.

Critics like Republican Rep. Roy Blunt of Missouri, and Florida tea party darling Marco Rubio, both Senate candidates, have decidedly partisan motives for condemning the bailouts and stimulus. Blinder and Zandi have their professional reputations to protect by playing it straight.

Harrop cites Blunt for referring to “the now-failed stimulus” and Rubio for lambasting his opponent, Gov. Charlie Crist, for having supported measures that ” failed to keep unemployment from soaring.” Like all GOP and tea party candidates, they’re demagoging about the $1.4 trillion budget deficit, predicting economic armageddon if drastic budget slashing, government shrinking and keeping big tax cuts for the rich don’t commence immediately.

Harrop reports what Blinder and Zandi’s models show about the cost of conservatives’ preferred policy of doing nothing.

Recessions themselves fuel deficits by raising social spending and lowering tax revenues. Thus, government programs that make economic downturns shallower and end them sooner can pay for themselves.

If Washington had not reacted as quickly and as forcefully as it did, the two economists write, “the costs to U.S. taxpayers would have been vastly greater.”

With no special government intervention, the 2010 deficit would have passed $2 trillion, according to their model. It would have reached $2.6 trillion in fiscal 2011 and $2.25 trillion in 2012.

Add outright deflation to the expected massive employment and falling GDP, Blinder and Zandi conclude, and “this dark scenario constitutes a 1930s-like depression.”

Unfortunately, most voters know economics and economic policy the way they know art: “If I like it, it’s a masterpiece. If I don’t, it’s junk.” Exploiting their instinctive dislike of big deficits is like shooting fish in a barrel, never mind what the alternative was.

Congressional Democrats and the Obama administration are in the unenviable position of having to defend a lesser-of-evils policy tied to a massive price tag, all because of the horrendously stupid, perverse recklessness of their predecessors. What’s more, Democrats must explain to voters how much grief that money prevented – a far tougher proposition than if they could brag up some impressive number of new jobs created.

Like America’s struggling unemployed and small-business people, Congressional Democrats are contending with a raw deal of others’ making. If Blinder and Zandi’s findings provide some help it will be a minor measure of political justice in a time when that’s even rarer than help-wanted ads for well-paying jobs.