Some commentary on today’s economic development —

Ezra writes,

A dramatic gap has opened between the economy as Washington sees it — and wants to intervene in it — and the economy that actually exists. Whatever weak recovery we might have hoped for is being hindered by global commodity prices, consumer deleveraging, fears of flagging demand in emerging markets, earthquakes in Asia, and much more. Globally, it’s been an almost uninterrupted run of crises and bad luck. Meanwhile, Washington just spent two months arguing over whether it would pay its bills or spark an unnecessary financial crisis.

Last week, Congress resolved that question. This week, the markets are tanking. Which suggests that Washington is asking itself the wrong question.

Josh Marshall —

Just remembering back now the international financial institution folks back in 2009/2010 saying it was important to rein in spending since the global economy was already coming back and the risk was inflation and indebtedness. 1937 anyone?

Paul Krugman says, in so many words — toldjah so.

Kevin Drum explains why European banks are in perilous circumstances David Leonhardt says that stock values could go lower still.

The recall elections for six Republican state senators is next Tuesday, and word is the Dem candidates are leading in three of those races and tied in the other three. I get the impression that establishment Democrats in Wisconsin are trying to talk down expectations a bit, and no one is saying it’s going to be a sweep. But by all accounts progressive enthusiasm is running high.

Meanwhile, the opposition is bringing in Sarah Palin, Joe the Plumber, Michele Bachmann and Ann Coulter to help get out the vote on the GOP side.

And Americans For Prosperity got caught being naughty. The wingnut organization sent out fliers to Wisconsin voters with the wrong date for returning absentee ballots.

There are some signs T-Paw is about to end his quixotic quest to be the first POTUS named “Tim.” His campaign has pulled ads in advance of the Ames straw poll — which may just mean he thinks Iowa is a lost cause — and a top adviser has left the campaign. These may be early warming signs rather than signals of an immanent collapse. Still …

Politico reports that the GOP establishment has massive reservations about the general election viability of a Rick Perry candidacy. Ya think?

You may have heard that Newt was accused of buying a Twitter following. Now it turns out that Newt’s Twitter following came about because Twitter put @newtgingrich on its suggested user list. In other words, it was a fluke.

Also this week, Newt called Barack Obama’s administration a “Paul Krugman Presidency.” We wish. Professor Krugman is skeptical.