LAWRENCE SUMMERS EXPLAINS THE NEW NORMAL ANEMIA: The global economy has entered unexplored, dangerous territory.

The International Monetary Fund’s growth forecast released just before the meeting was once again revised downward. While recession does not impend in any major region, growth is expected at rates dangerously close to stall speed. Worse is the spreading realization that the central banks have little fuel left in their tanks. Recessions come intermittently and unpredictably. Containing them generally requires 5 percentage points of rate cuts. Nowhere in the industrial world do central banks have anything like this kind of room, even allowing for the effects of unconventional policies such as quantitative easing. Market expectations suggest that it is unlikely they will gain much room for years.

Summers adds that “It can hardly come as a great surprise that when economic growth falls short year after year, and when its beneficiaries are a small subset of the population, electorates turn surly.”

In this country, the regulatory state has never been so intrusive or capricious, entitlements and disability payments dwarf the Great Depression’s New Deal, deficits are set to explode again even without a recession, and our public debt is at levels unprecedented without a global war. Perhaps worst of all, not even nine trillion in new debt and a multitrillion dollar expansion of the Fed’s balance sheet could buy us a “recovery” with GDP growth close to the postwar average.

That’s some bad luck making voters so surly.