Tuesday, October 8, 2013

Dismal Links to Dismal Science Wonks

The Roubini stable of experts offer this somewhat cold-blooded collection of observations of economic matters. This subject strikes me as dry and boring so I haven't read them closely. My understanding of history is that all the facts in the world cannot penetrate deliberate ignorance any more than evidence of global warming influences the retrograde thinking of deniers.

Here are the links. Have at them.

My favorite assessment as I scanned these articles was by Ed Dolan, third bullet point above...
I am at a loss to find a word that adequately describes this pattern of fiscal policy. The best I can come up with is stupid.

The years of prosperity from 2000 to 2007 were accompanied by a movement toward structural deficits—the result of large tax cuts combined with unfunded foreign wars. (Note that the recession of 2001 was so shallow that the output gap never moved into negative territory.) Then came a brief countercyclical interlude in 2008 and 2009, when first the Bush and then the Obama administrations undertook stimulus measures to mitigate the effects of the financial crisis. However, as soon as the economy had reached the trough of the cycle, in mid-2009, but while it was still experiencing a large, negative output gap, policy turned procyclical again. Spending cuts and tax increases began moving the structural balance back toward surplus. The result has been a slow recovery with hardly any narrowing of the negative output gap over the past four years.

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