Paul Krugman's "The Lame-Duck Economy"

Paul Krugman wrote a truly frightening column this morning for the New York Times. His point: the 60 day or so transition from the George W. Bush White House to the Barack Obama White House could be a complete disaster as the economy continues to falter and nothing gets done because we have such an ineffectual, lame-duck president in office. How much worse can it get? Here's what Krugman says:

How much can go wrong in the two months before Mr. Obama takes the oath of office? The answer, unfortunately, is: a lot. Consider how much darker the economic picture has grown since the failure of Lehman Brothers, which took place just over two months ago. And the pace of deterioration seems to be accelerating.

Most obviously, we’re in the midst of the worst stock market crash since the Great Depression: the Standard & Poor’s 500-stock index has now fallen more than 50 percent from its peak. Other indicators are arguably even more disturbing: unemployment claims are surging, manufacturing production is plunging, interest rates on corporate bonds — which reflect investor fears of default — are soaring, which will almost surely lead to a sharp fall in business spending. The prospects for the economy look much grimmer now than they did as little as a week or two ago.

I'm obviously not an economist, but I've read a lot of expert opinions lately, and consensus seems to be the government needs to spend, spend and spend to help the economy get out of it's rut. That means going into a huge deficit to make sure money is going directly into the economy in the hopes of stimulating it. But unfortunately we don't have the leadership to make that happen right now. And if things get even worse before Obama takes office, it might be too late for him to really swing the balance of the economy in the right direction. Scary thought, I know. Let's just hope we don't see another great depression.