It's part of Mitt Romney's talking points. And when one hears that if only Obama had let the banking system collapse entirely, the auto industry melt down, and slashed spending rather than offering a stimulus … all would be better, one is right to dismiss it as lunacy. Even if one believes that these would have been better policies, can anyone actually argue that if Obama had followed them, unemployment would now be lower than where it is? Or growth higher? Maybe you could argue that growth would be better in the future without the moral hazard of bailouts and stimuli, but now? Give me a break.

The next option is to claim that the threat of higher business costs for healthcare and of re-regulating Wall Street is suppressing private investment and weakening profits. That's Gary Becker's line. But corporate profits are in record territory, and Yglesias hauls out the following graph:

Fredgraph-1-11

Case closed, I think. How am I wrong?