In his column today, David Brooks writes about the economy and "economic realism."

Demand Sider Krugman responds.

Demand Sider Dean Baker responds as well.

Yglesias and Ezra Klein note Brooks disagrees with those who - like Republicans and Senator Nelson - believe unemployment insurance shouldn't be extended even with high unemployment and with states slashing budgets and other mixed economic indicators.

Yves Smith and Rob Parenteau have an Op-Ed next to Brooks's column:

Some may argue that businesses aren’t investing in growth because the prospects for success are so poor, but American corporate profits are nearly all the way back to their peak, right before the global financial crisis took hold.

Another problem for the economy is that, once the crisis began, families and individuals started tightening their belts, bolstering their bank accounts or trying to pay down borrowings (another form of saving).

If households and corporations are trying to save more of their income and spend less, then it is up to the other two sectors of the economy -- the government and the import-export sector -- to spend more and save less to keep the economy humming. In other words, there needs to be a large trade surplus, a large government deficit or some combination of the two. This isn’t a matter of economic theory; it’s based in simple accounting.

What if a government instead embarks on an austerity program? Income growth will stall, and household wages and business profits may fall.