With the fiscal cliff looming, readers and lawmakers (and the readers who happen to be lawmakers) can get a better grip on the crisis by checking out Government Policies and the Delayed Economic Recovery, edited by Lee Ohanian, John Taylor, and Ian Wright (Hoover Institution Press). At a recent lunch discussion in D.C., Ohanian, a Hoover senior fellow and economics professor at UCLA, explained how government policies such as the stimulus checks, the home-buyer tax credit, emergency unemployment compensation, and Cash for Clunkers are delaying economic recovery.

When Ohanian looked back at the New Deal, he realized recovery had been delayed 5-10 years. He figures that today we’ve lost about three or four years’ growth. Certainly corporations and businesses are recovering and productivity is up, but job creation is trending downward. “We’re at risk of a permanent underachieving economy,” said Ohanian, who pointed to Europe as an example—there are fewer workers in Germany, France, and Belgium today than there were some 50 years ago (yes, there is a correlation with the lessening of working hours per week). There is also a correlation to higher tax rates.