Brad DeLong has long argued against the fears that we could head into something like the Great Depression.

But now the UC Berkeley economist has turned a bit bearish on the economy.

From DeLong:

For 2 1/4 years now I have been saying that there is no chance of a repeat of the Great Depression or anything like it -- that we know what to do and how to do it and will do it if things turn south.



I don't think I can say that anymore. In my estimation the chances of another big downward shock to the U.S. economy -- a shock that would carry us from the 1/3-of-a-Great-Depression we have now to 2/3 or more--are about 5%. And it now looks very much as if if such a shock hits the U.S. government will be unable to do a d----- thing about it.

DeLong thinks that Democratic deficit hawks and Republican anti-stimulus politicians will effectively prevent the government from doing anything to ameliorate a deteriorating economic situation. What’s more, outrage against the bailouts coming from the left and the right will prevent the Obama administration from orchestrating anything like we saw last fall.



“So if another big bad shock hits the U.S. economy, what could the Obama administration possibly do?” DeLong asks.