The Wall Street Journal has a dilemma. How does an anti-Obama, Keynesian outfit treat the putative economic recovery. Here’s the compromise: “We’re not going to have a strong recovery … It’s likely going to be a pretty sluggish affair.”

The truth is much worse. But you already knew it. A couple of weeks back I warned against accepting the media-congressional-presidential complex’s contention that slight upticks in the GDP were indicators of a recovery. In “…Like A Housewarming For The Homeless” I explained that,

the GDP statistic is consumption-driven: it measures the kind of economic Brownian motion of which less is required. ‘This statistic is constructed in accordance with the view that what drives an economy is not the production of wealth but rather its consumption,’ confirms (Austrian) economist Frank Shostak. ‘What matters here is demand for final goods and services. Since consumer outlays are the largest part of overall demand, it is commonly held that consumer demand sets in motion economic growth.’

The temporary bump in the economy is due to the halcyon stimulative high—the effects of all the fiat funny-money floating around and further distorting production patterns.

Says Peter Schiff, the Austrian economics wizard who has yet to be wrong: We are now in an even deeper hole than when the crisis began. Rather than wrapping up a recession, we are actually sinking into a depression. If things look better now, it’s just because we are in the eye of the storm“:

By interfering with the unpleasant forces of the recession, we simply trade short-term gain for long-term pain. By propping up inefficient companies that should fail, we deprive more effective companies of the capital they need to grow. By holding up over-valued asset prices, we prevent the prudent or less well-off from snatching them up and, in doing so, creating a new price equilibrium based upon reality. By maintaining artificially low interest rates, we discourage the very savings that are so critical to capital formation and future economic growth. In addition, the false economic signals the Fed sends the market prevent a more efficient re-allocation of resources from taking place and leads to even more bad economic decision being made. By running such huge deficits, we further crowd-out private enterprise by making it harder for businesses to invest or hire

The verbose Donny Deutsch, a lefty business-cum-mediaman, who’s proving too much of a rightist for the front fems who anchor MSNBC programs, declared the “Clunkers for Cash” give-away, wealth-distribution initiative an example of economic innovation. Inoculate yourselves:

The recently passed “cash for clunkers” program (currently on-hold, as it ran out of funding in one week) is a perfect example of how government policy can make the economy worse. By incentivizing Americans to destroy fully paid-for cars so they can go deeper into debt buying brand new ones, the government weakens an already crippled economy. The last thing we want to do is subsidize Americans to go deeper into debt by buying more stuff. Don’t they realize that is precisely the behavior that got us into this mess?

Think about it this way. If your friend were in trouble because he had too much debt, would you encourage him to take on even more? Wouldn’t a real sign of progress be a reduction of debt, even if he had to cut back on his everyday expenses? What is true for an individual is also true for a collection of individuals, even if they call themselves a ‘government.’ If, as a country, we are even deeper into debt now than we were before, we are worse off. Period. The fact that the additional debt enabled better short-term GDP numbers is a long-term negative.