It's already too late. There's no peaceful way back from here.
It’s only a depression because they stubbornly refuse to do the things that would get it going again, much like Roosevelt. But I fear you are right - and what the heck. Who wants to go back to the stupid crap we’ve been living with for the last generation.
I fear you're right. IMO, out here in flyover country, the plan was for Boomers to retire on schedule, and the Xers would be promoted to fill the shoes of those retiring. The meltdown of 2008 set that plan back by a minimum of five years.
Management overreacted on layoffs, thanks to the $hitstorm of legislation in Washington: Porkulus, cap and trade, and the continuing uncertainty of health care legislation. Add to that the expected spike in income tax rates for businesses and individuals alike, and one can easily understand the overreaction on layoffs.
A seismic shift is taking place in what was once thought of as "safe and stable" careers, accounting to be specific. Big 4 firms have laid off 25% of staff over the past 18 months. Temp service companies have seen their profits fall by 90% and more (Robert Half). Accounting departments have been cut into the bone, which will lead to restatements of financial statements and amended tax returns for years to come. Management's attitude is "we'll deal with that later."
The professionals that I know and respect are smart people, and will figure out a way to survive these difficult times. In the interim, their spending will be limited to bare necessities. On a macro level, this implies no surge in consumer demand, which is necessary to sustain any economic growth.
When you also factor in the ongoing deleveraging of the average American, it's unrealistic to expect anything more than a stagnant economy during 2010.
Larry Summers may be book smart, but he's clueless about what's going on beyond the Beltway.