Countless scholars have studied exactly how the federal government managed to turn a stock market crash and cyclicalrecession into a fifteen year nightmare.
California has lived through a magnified version of the U.S. cyclicalrecession of 2008 but has failed to adequately recover due to structural deficiencies.
Looking back at the percentage of Americans with jobs in the 1990s (rising) and the 2000s (falling), Princeton University economist Alan Krueger estimates that 70% of today's job shortage is simply cyclical, the result of a disappointing recovery from a deep recession.
While abiding by IMF-crafted pro-cyclical policies which included cutting spending, poverty and unemployment soared as the recession deepened. (Read Weakening Euro And Oil Stock Piles Drive Dollar Higher).
But many worry that, at a time of widespread crisis, such pro-cyclical rules risk imposing too much austerity too widely, thus darkening the spectre of recession and making it even harder to balance budgets.