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"I was wrong. He was right." That's an statement that you don't see frequently. Huge respect to professor DeLong.
The 2008 recession, while deep and sudden, was narrow, only lasting about 16 months until growth picked up, where it has remained. Hardly a decade.
Also, the authors seem to be cherry picking the bad data (weak wage growth, China, shrinking labor force) and ignoring the good data such as exports, consumer spending, robust S&P 500 profits & earnings, technological innovation, stock market gains, etc.
Right now, we’re in a Goldilocks economy of modest growth, no stagnation, tame inflation, and no meaningful economic headwinds. Some pundits like Summers and Krugman bemoan how America’s economic growth is too anemic, especially compared to the 40′s and 50′s, and that its best days are behind it, but as I show here and in the graph below, US GDP growth has broken from the pack, since 2008 exceeding pretty much all g-20 nations. Yeah, 2-3% GDP growth ain’t great, but compared to pretty much everywhere else that has either no growth (Japan, UK, France) or high-inflation growth (Turkey, India, Brazil) – it’s pretty good.
source: http://greyenlightenment.com/america-is-not-in-decline-long-...
And that is especially impressive for an economy as large as America. We’re never going to get back to 40′s era growth, and that’s fine. Law of large numbers and diminishing returns. It’s harder to grow an economy that is 5x larger at the rate it was growing when it was 5x smaller.
Post-2008 GDP growth is pretty much back to the historical average, or at least back to where it was in the late 90′s and 2000′s. Not hyper-speed growth, but certainty not recessionary.
Recent real GDP (below) doesn’t differ too much from historical performance:
http://i.imgur.com/znVtqaH.jpg
Real US GDP growth is roughly back to where it was between 1997-2007, and no one was complaining about stagnation back then.
Earlier quoted context omitted.
That's why reform has to start at a local level. Solutions that work brilliantly in Massachusetts have no guarantee of succeeding in Mississippi. Whatever ends up working broadly should be adopted by the federal government. Perhaps they could provide a block grant to each of the states to experiment with reforms and study the effects.
Lots of things probably won't work very well at the state level, but might nationally. Consider what could happen if just a single state offered universal basic income, for instance.
UBI has been experimented with in many locations, from Canada to Namibia, and they often showed the same effect: some people dropped out of the labor force, others did so but to be homemakers, volunteers, and so on, and for many of the rest, their incomes improved because they had a reliable safety net and worked to increase their earnings so they could live better, as we all do.
We can consider till the cows come home, but people have put up with debate for too long. They need action.
In the course of selling his New Deal to the impoverished American public, president Franklin Delano Roosevelt pitched his reforms by stating: "It is common sense to take a method and try it. If it fails, admit it frankly and try another, but above all try something. The millions who are in want will not stand by silently forever while the things to satisfy their needs are within easy reach." The most frustrating par…
How many times has the federal government tried something that didn't work and frankly admitted the failure?
In the course of selling his New Deal to the impoverished American public, president Franklin Delano Roosevelt pitched his reforms by stating: "It is common sense to take a method and try it. If it fails, admit it frankly and try another, but above all try something. The millions who are in want will not stand by silently forever while the things to satisfy their needs are within easy reach." The most frustrating par…
In my opinion, the most frustrating part is that despite our hyperconnectedness, people still believe the propaganda that we're not in a depression or that our leaders got us out of the recession. Future economists will call the decade the "longest depression" not out of 20/20 hindsight, but simply because there will no longer be a need to make things seem rosy.
Is there a source for this? Everyone I know believes that we still are in a depression, so it's probably just my social circles. I'd be interested to see the stats behind that.
In the course of selling his New Deal to the impoverished American public, president Franklin Delano Roosevelt pitched his reforms by stating: "It is common sense to take a method and try it. If it fails, admit it frankly and try another, but above all try something. The millions who are in want will not stand by silently forever while the things to satisfy their needs are within easy reach." The most frustrating par…
Ironically, it could be this very abundance of ideas which is so paralyzing. The more choices you have, the harder it is to choose. That being said, I agree that this problem has its roots in corrupt politics.
I think one of the top-3 issues facing the US right now is we need a lot more power devolved back to the states... not out of a "state's rights" sense of the argument, but out of a sheer engineering argument that trying to run a large and diverse country from one city is not working in practice, and there's no theoretical reason why it should work. Diversity and central control are, if perhaps not necessarily "incompatible" in the strictest sense of the term, still at great odds with each other; the central authority is forever tempted to homogenize diversity to make central control easier.
In the course of selling his New Deal to the impoverished American public, president Franklin Delano Roosevelt pitched his reforms by stating: "It is common sense to take a method and try it. If it fails, admit it frankly and try another, but above all try something. The millions who are in want will not stand by silently forever while the things to satisfy their needs are within easy reach." The most frustrating par…
How many times has the federal government tried something that didn't work and frankly admitted the failure?
Earlier quoted context omitted.
That's why reform has to start at a local level. Solutions that work brilliantly in Massachusetts have no guarantee of succeeding in Mississippi. Whatever ends up working broadly should be adopted by the federal government. Perhaps they could provide a block grant to each of the states to experiment with reforms and study the effects.
Lots of things probably won't work very well at the state level, but might nationally. Consider what could happen if just a single state offered universal basic income, for instance.
Roughly the same thing as one country that offers universal basic income but doesn't control its borders, for the exact same reason?
Also, UBI isn't magic. If it would not work in a state individually, it does not become practical by banding 50 states it doesn't work in together. In fact, with the size of most US states, that's just generally true; it is not possible for something to not work in a state due to resource contraints but suddenly become possible when 50 insufficiently-resourced states band together.
Earlier quoted context omitted.
In my opinion, the most frustrating part is that despite our hyperconnectedness, people still believe the propaganda that we're not in a depression or that our leaders got us out of the recession. Future economists will call the decade the "longest depression" not out of 20/20 hindsight, but simply because there will no longer be a need to make things seem rosy.
The terms "depression" and "recession" aren't just catch alls, they have actual definitions. And "we" (depending on the country, i'm assuming USA) are not in either.
