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What's happening now is that the government has kicked recessions into the future since the late 1990's. Government has tried every Keynesian trick in the books and, surprise, surprise, they have failed. Now instead of a short and sharp recession around 2001, there is a very real chance of a severe and damaging depression.
Capital and credit are not the problem. There is plenty of both. The problem is lack of production in terms of goods and services. Government CAN NOT create these things no matter how much it spends and spending (paid for with taxes and inflation) actually kills jobs. Until production in terms of good and services generated in the private sector by the legitimate private sector picks up, then the economy will continue to collapse. It will continue to collapse the more government tinkers with taxes, regulations and plays favorites with taxpayer money (think GM, Solyndra, public unions, etc.)".
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