“…Here are the facts of the economic case as I see them today:
- Much of Europe is in recession and the downturn is in no small part a function of austerity measures that like bloodletting -
- are making things worse not better.
While the new French president is certainly making the right sounds – it’s awfully hard to point to the actual implementation of helpful policy anywhere.
- The U.S. is doing better but we too are failing to enact measures that would finally release the economy from the residual gravitational pull of the Great Recession.
- The latter point is showing up in lots of worrisome places: the economy is slogging along at too slow a growth rate (around 2%); -
- the job market may be decelerating from an okay pace to a sub-par pace; -
- real paychecks are falling behind inflation.
All of which begs the question -
- why are advanced economies so seemingly immune to correct diagnosis and prescription?
Why are we applying leeches instead of the contemporary medicine of combined monetary and fiscal stimulus -
- in order to once and for all hit the escape velocity that’s eluded us thus far?
Here are some answers off the top of my head:..”
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