IBJOpinion

MARCUS: Fed programs get credit for improvements

Morton Marcus
June 26, 2010
Back to TopCommentsE-mailPrintBookmark and Share
Morton Marcus

Horace Heliotrope sees the world in terms of persistent sadness. I’m not qualified to say he is clinically depressed, but he isn’t a happy fellow.

“The economy is as bad as we’ve seen in our lifetimes,” Horace said to me as we stood in line at the superstore checkout.

“No,” I said as cheerfully as I could. “The recession is over. The downward movement in the economy, the contraction in employment, output and income is yesterday’s story. That does not mean we are out of the ditch or that we are back to where we were before the recession. Now is a time of slow upward movement, a period of recovery.”

“Won’t last,” Horace intoned with a funereal certainty. “We’re going to have a double or triple dip; the worst is yet to come.”

“I don’t think so,” I said.

“Inflation is coming,” he announced to one and all, without raising his voice.

“Maybe,” I said, “but it may not be serious this time around.”

“Our state economy is ruined; Indiana will never be the same,” Horace proclaimed.

“Not so,” I said. “Indiana has fared fairly well in this recession. The personal income figures released last week by the U.S. Bureau of Economic Analysis show that Indiana had a 1.2-percent increase in the first quarter of this year compared with a 0.9-percent pickup in the nation. That put us in 16th place among the 50 states.

“Furthermore,” I continued, as Horace unloaded his cart onto the checkout conveyor belt, “we also ranked 16th over the past year in personal-income growth (2.6 percent for us, 1.9 for the nation). In fact, if you look at where we are now and where we started into the recession (2008 second quarter), we’re just 0.4-percent off our peak level of personal income. The United States as a whole is 0.9-percent off its peak (not accounting for inflation). Not only is Indiana in better shape than the country, but we also beat out Ohio, Michigan, Illinois and Wisconsin—the other four states of the Great Lakes region.”

“Since when did you join the Daniels administration?” Horace asked.

“The facts are the facts,” I said. “What we should be asking is: How did all this come about?”

“So,” he asked, “how did all this come about?”

“The big, bad federal government,” I responded. “They pumped $6.3 billion into the Indiana economy through higher unemployment compensation and increased Social Security and Medicare payments. This offset entirely the decline of workers’ earnings from the second quarter of 2008 to the first quarter of this year.”

“Yeah,” Horace admitted, “but that wasn’t the stimulus money.”

“The fact is that it stimulated our economy,” I said. “You know, I’d like to see somebody put a label on every can of beans bought with unemployment compensation. I’d like to see every teacher’s or firefighter’s paycheck stamped ‘Stimulus Money Used Here.’

“How about detailing just how many dollars went to doctors, nurses, pharmacies and hospitals in the state from added Medicare and Medicaid funds paid out by the federal government? Without knowing it, many thousands of Hoosiers kept their jobs because of added direct federal spending or added federal funds flowing through state and local governments.”

“Just as I thought,” Horace said as he paid for his purchases. “Things could have been much worse, which means things were much worse than most of us realized.”

“That’s right,” I agreed, stacking my purchases on the checkout counter. “Without the stimulus money and the ongoing federal income and health maintenance funding, we would have been in a terrible mess.”

Horace looked at me with his Bassett-hound eyes. “No matter how well things seem to be going, you have to anticipate the lurking danger.”

I returned his visual challenge and said, “At minimum, we should give Uncle Sam the credit he is due.”• 

__________

Marcus taught economics for more than 30 years at Indiana University and is the former director of IU’s Business Research Center. His column appears weekly. He can be reached at mmarcus@ibj.com.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
thisissue1-092914.jpg 092914

Subscribe to IBJ
  1. Here are a few candidates for this new group, "ripped from the headlines." First up, that bizzaro State Senator Brent Waltz; secondly, the unethical Todd Huston, and his contractual arrangements scheme; Finally, but not least of all, the dishonorable Eric Turner. What sayeth you Greg Zoeller?

  2. Good day. I can't hide this great testimony that take place in my life I will love everyone to know it and be partaker that is why I always place it on answer, I am Mrs,Natalie Cuttaia by name, I live in Texas, United State Of America, I want to thank (Mr.Bruce Brandon) for his kindness upon my family life. I never knew that there is still nice lender like this on internet and earth here. Just some Months Back, I was in search for a loan of $100,000,00 as I was running out of money for feeding and rent. I was scammed $6,800 Dollars and I decided not to involve my self in such business again but a Friend of my introduced me to a loan firm due to my appearance and doings. And I told him that I am not interested of any loan deal anymore but he told me that there is still a nice lender who he will recommend me to, and I made a trial and I am most grateful lucky am I today, I was given a loan amount of $100,000.00usd, by this great Company (Bruce Brandon Loan Company) managed by (Mr.Bruce Brandon) If you are in need of a genuine or legit loan or financial assistance and you can be reliable and trusted of capable of paying back at the due time of the funds I will advice you to, contact him via: ( bruce.brandon071@gmail.com ) And you will be free from scams in the internet. All thanks to Mr.Bruce Brandon You are the one who remove me and my family out of poverty. The reason why i am doing this is that, i promise Mr.Bruce Brandon that if i truly got my loan, i will advertize his company and bring customers to his company. Contact him via ( bruce.brandon071@gmail.com )for the Loan you have been looking for..

  3. Hello, We are firm Organization formed to help people in needs of helps,such as financial help. So if you are going through financial difficulty or you are in any financial mess,and you need funds to start up your own business,or you need loan to settle your debt or pay off your bills,start a nice business, or you are finding it hard to obtain capital loan from local banks,contact us today via email mrsroseberrywilkinsfunds.usa@gmail.com So do not let these opportunity pass you by because Jesus is the same yesterday, today and forever more. Please these is for serious minded and God fearing People. Your Name: Loan Amount: Loan Duration: Valid Cell Phone Number: Thanks for your understanding to your contact as we Await Regards Management Email:mrsroseberrywilkinsfunds.usa@gmail.com

  4. The question is, where could they build a new stadium? It seems in the past year, all the prime spots have been spoken for with potential projects. Maybe in the industrial wasteland area a block past Lucas Oil? I think it needs to be close to the core, if a new stadium is built.

  5. Aldi is generally a great shopping experience. Still, I'm sure YOU wouldn't want to shop there, which I consider a positive.

ADVERTISEMENT