Sunday, July 1, 2012

Galbraith on the consequences of fiscal austerity

What would a significant fiscal adjustment, as the jumping of the so-called fiscal cliff would require next year, would be you ask? Jamie Galbraith has provided a timely answer in the Nation (here; hat tip Nathan Cedrus Tankus). In short: "a big deficit-reduction program would destroy the economy, or what remains of it, two years into the Great Crisis."

1 comment:

  1. Thanks for linking to that piece. Galbraith puts it clearly and forcefully, leaving no room for misunderstanding. It gives me some hope that a magazine like The Nation is printing it.


The budget, the fragile recovery and the next recession

I'm not a forecaster. I do macro, and worked for Wynne Godley at the Levy, but I feel that there are too many dangers in forecasting...