Yet despite a great deal of rhetoric to the contrary, the Bush years have not seen compensating cuts in federal spending: it has risen by over 1 percent of GDP. This fact drives hardcore conservatives crazy. About three-quarters of the increase can be accounted for by a buildup of the military. Bush and the Republican-controlled Congress have hardly discovered the virtues of public spending on education or the environment; as this article was going to press, Congress had just passed $40 billion in spending cuts, concentrated on Medicare and Medicaid. But putting the tax cuts and spending increases together, you see a huge shift in the federal budget balance, from a surplus of 1.1 percent of GDP in 2000 to a deficit of 2.1 percent last year. That's not as big as the Reagan deficits of the early 1980s, for sure, but it's still a boatload of money on a troubling course.

This isn't to argue that deficits are always bad, or that the large surpluses of the Clinton years were necessarily a good thing. A deficit can be a good way to kick-start a sagging economy. But when the deficits become chronic and structural, as they are now, more and more of the federal budget is devoted to interest payments on the debt, and the right is handed a convenient argument against any new public spending. In fact, you'd almost suspect that this was the point of creating $400 billion deficits in the first place—to have a ready-made argument to cut social spending.

And, as everyone not in the pay of Karl Rove can tell you, the tax cuts were heavily skewed toward the rich. Not merely the upper middle class, even, but the very rich. According to estimates by Citizens for Tax Justice, households with incomes of around $75,000 got an average tax cut of $400 from the GOP's 2003 scheme; those with $50,000 incomes have saved less than $200 a year; those with $30,000 incomes got almost nothing. But those in the top 1 percent, with incomes around $1 million, got almost $25,000 a year in cuts. About a third of American households live on $25,000 a year or less; millionaires got that much in tax cuts alone. No wonder the rich were such enthusiastic Bush voters in 2004!

THE JAPAN PARADIGM—Regardless of the fairness or prudence of giving millionaires huge tax cuts, one could argue that the deficits that the cuts created were decent as economic policy—a stimulus to counteract the twin shocks of the bursting of the dot-com bubble and, a little over a year later, the 9/11 attacks. And you wouldn't be entirely wrong to argue that. When Japan's stock market bubble burst in 1989, it ushered in more than a decade of economic stagnation, to which the Japanese government was very slow to respond. Of course, the administration and its congressional allies didn't intend the tax cuts as an inoculation against the Japanese experience; they just wanted to give their base some nice fat refund checks.

But intended or not, the deficit did, at least on paper, look like a vast fiscal stimulus, to use the jargon of economics. At the same time, the Federal Reserve, very conscious of trying to avoid what happened to the Japanese, drove short-term interest rates down to 1 percent, a level not seen since the 1950s. In other words, the twin engines of government policy, fiscal and monetary, were both set to full throttle.

Despite all that stimulus, however, the recovery from the 2001 recession has been weak on the surface, and rather bizarre when you look at it more closely. That weak response, despite the massive stimuli coming out of Washington, suggests that there's an underlying sickness to the economy that just isn't being addressed.

JOBS DON'T COME BACK—For students of the "business cycle"—the broad upswings and downswings that all capitalist economies are subject to—this expansion has been a strange one indeed. In a phrase, capital has thrived and labor hasn't. Since the recession ended at the end of 2001, corporate profits are up 81 percent, while the wages that corporations pay their employees are up just 18 percent, a ratio of over four to one. That's the most lopsided performance of the ten expansions that have occurred since the end of World War II. And that measure of wages is pulled misleadingly higher by the outsized performance of the upper brackets; the pay going to ordinary workers (the 80 percent of the workforce classified by the Bureau of Labor Statistics as "nonsupervisory") is up only about 14 percent.

The job market of the Bush years is the worst in modern times. Yes, the economy added two million jobs in 2005, but that's nearly a million short of what we would have seen had historical averages prevailed. Employment continued to fall for a year and a half after the recession's official end. There's only one post-World War II precedent for that—the early 1990s, when the job market lagged that abstraction known as "the economy" by eleven months. But even after employment bottomed out, it grew at far slower than the accustomed pace. Putting the long decline and sluggish recovery together, we're some ten million jobs below where we should be, based on historical averages.

A DEBTOR SOCIETY—Despite tepid income growth, Americans have continued to buy stuff with great enthusiasm. In fact, if you look just at the consumption side of the economy, there was barely a recession in 2001. How'd they manage this? With heroic levels of borrowing.