Having read most of the individual articles above, none of the authors have answered the most important question.
What new growth engine will bring us out of the Recession?
There was no new growth engine that brought us out of the Great Depression, other than time. Our
1929 GDP of $103 billion was not again reached until 1941. That's because in 1929, GDP was far higher than any fundamentals justified. Below is chart from the US Bureau of Economic Analysis showing GDP from 1929 to 1938 (Space prevents showing 1939-41).
The same situation exists today that existed in 1929. There has been no cause for our GDP to expand since 2000. We grew based on increased debt-financed spending, overvalued homes, and derivatives thereof. But there was little additional real wealth produced, other than homes. And the artificially created over-demand for homes caused more to be produced than there was any wage/income-financed demand for.
Credit/debt-financed demand is not real demand. And when supply is increased in response to credit/debt-financed demand, there is an oversupply in real terms. And once that credit/debt source of demand contracts, so does the demand it created. At that point, the oversupply becomes apparent. The oversupply reduces demand, and reduces the value of all of the debt instruments created from that supply, and reduces the demand for all goods & services that were financed from the artificial paper wealth created by the instruments and their overvalued collateral.
And the loss of this artificial demand, coupled with the reduced demand from decreased "wealth effect," reduces demand for labor to produce goods and services. That, in turn, reduces "real" demand, by reducing both employment and wages.
So once again, what do these "experts" think is going to bring us out of this recession? What new source of demand will come along? What new product or industry will there be to create goods that there will be a demand for -- a product that consumers will purchase -- a good whose production will provide employment for American workers, giving workers the income to restore production demand, and employ still more workers to make that good?
Where is that new industry? Where is that new good that consumers will purchase? If the experts can't answer that question, then how can they predict a recovery? How can they predict a recovery if they have no idea what growth engine will arise anew, or whether one will arise at all?
I think we're in for an L-shaped De-pression. I think it will be many years before our economy returns to a $14 trillion GDP.
Yet it is politics and greed, not actual economic reality, that will prevent our recovery.
The truth is that the we ALREADY have a source of demand to start the recovery. That source is our trade deficit. It is the demand we lose by purchasing imports, instead of domestic production. But we can only tap this source if we re-channel import purchases into domestic purchases.
Though we can do little in the short-term about our ~$300 billion in oil & energy imports, there is plenty we can do about our ~$400 billion in non-energy imports. We can immediately raise TARIFFS, adding the expense of tariffs to the price of foreign imports. This would reduce the quantity demand for imports, and increase the demand for American products to replace them. And it would increase the demand for workers to produce those goods, raising both American employment and wages. Since both increased employment and increased wages raise aggregate consumer income, it would also raise aggregate consumer spending power and production demand. The increased production demand would result in the employment of still more American workers, and put still more upward pressure on American wages. And this cycle would continue indefinitely, as long as we maintained high tariffs to protect American industry and its workers.
And, in case it isn't already obvious, TARIFFS bring in additional Federal revenue, instead of spending Federal revenue. Our budget deficit and national debt would fall (or rise less), and there would be more funds available for either tax cuts, increased government spending, or both.
The trade deficit makes us unique in the developed world. We are the only developed country that already has this readily available source of demand and employment. We don't actually need to create any
new industries, or find a new source of demand. We simply need to start filling our current production demand with American production, instead of foreign production.
In summary, the only real hope for a near-term recovery is the resumption of Protectionist policies, with the conversion of import purchases into domestic purchases and production demand, through imposition of TARIFFS.
Such policies were employed successfully for the first 200 years of this nation's existence. In fact, it is these "evil" protectionist policies that made us the economic powerhouse we were until the mid 1970's, when Greedonomics and Reaganomics started the downfall of our industrial might, and replaced the real wealth production of industrial capitalism, with the fake wealth production of financial capitalism.
The end result of financial capitalism is the upward redistribution of wealth from an ever-shrinking economic pie.
Employed production workers produce new, real wealth. Employed financial workers redistribute a fixed amount of wealth upwards.
We don't need a financial system at all, if we don't have any wealth to redistribute.
The foundation of an economy is it's productive industrial base,
not its redistributive financial system.
It's amazing how our leaders have lost sight of this. It's also tragic, as the overemphasis on our "financial system" is leading us to complete economic ruin.