@10 months ago with 13 notes
#paul krugman #politics #economics #austerity
The Anti-Austerity Crusader: An interview with Paul Krugman.
Economically speaking, the answer is simple: Increase spending and boost consumption, because the fundamental problem at the root of this crisis is lack of demand. How to do it? Lend money to the local authorities, municipalities in trouble, and states with low liquidity levels so they can re-hire teachers, firemen and public employees, and put people back to work. Hypothetically, if the government were to allocate $300 billion to local entities, this would help generate about 1.3 million new jobs and the unemployment rate would fall to under 7 percent. Yet none of this is happening because at the political level the issue is much more difficult. Republicans stubbornly and ideologically oppose any increase in government spending. They control the House and will not allow a new stimulus package to pass. Just look at the 2009 stimulus bill. The Obama administration’s $700 billion package was not nearly enough to get the economy back on its feet. In order to achieve tangible results the bill should have been much larger. The reality was that politically it was impossible because the president was forced to compromise with the Republicans…
Listening to Krugman’s lucid rationality is a relief at the constant rate of austerity stupidity.
(Source: diadoumenos, via other-stuff)