Buy coffee to stimulate the economy

Michael Kinsley has been a huge favorite of mine--for his ability to analyze major policy issues and interpret them in simple language (such as his column on on why social security privatization won't work), and the humor that is there in anything he writes. The heights of humor was in the column that he wrote about his brain surgery.

In this column in the NY Times, Kinsley yet again injects that humor into a discussion of the current economic crisis. Here is an excerpt:

Without consumers to lead the charge, an economic recovery will be hard to achieve. And yet everyone agrees that we need to start saving more. So should I buy that coffee maker to stimulate the economy? Or should I save the money in order to “grow” the economy and provide for my own old age? I can’t do both.

This is the dilemma that 30 years of Reaganomics (the real Reaganomics — keeping the economy overstimulated with huge deficits and irresponsible consumer borrowing — not the fantasy Reaganomics of government run like a family and tax cuts that pay for themselves) has left us with. So what do we do? The nearest thing to an actual plan seems to be something like this: stimulate first, to avert various short-term disasters, and then — at some signal from the Treasury Department — turn around and start saving like mad, to avert various long-term disasters. In other words, we need to get back our consumer confidence, and then lose it again.

The first part is fun. We just keep doing what we’ve been doing, only more and faster. The deficit may soar to $1 trillion a year while the government hands out cash to whoever shows up at the teller’s window. Each of us can do our own bit as well. Show your consumer confidence. One last shopping spree. Buy that coffee maker whether you want one or not.

Part II will not be fun. Return the coffee maker (if the store is still in business), and deposit the money in your 401(k). Start drinking instant.