Of course, Sarah Palin is quite right in her concerns about the economic impact of more quantitative easing. At best, Ben Bernanke’s efforts may add a third of percentage point to GDP. Maybe. And at what cost? Bubbles in commodities and emerging markets, capital controls, currency interventions, further erosion of America’s role as an economic model. All for, as Palin puts it, “temporary, artificial economic growth.” Or as Kevin Warsh of the Fed puts it:
Looking for some bipartisan solutions to America’s economic problems?
Well, I just read a great book on U.S. economic policy that is definitely worth checking out: “Seeds of Destruction” written by Glenn Hubbard and Peter Navarro. Hubbard is the former head of the Council of Economic Advisers under George W. Bush and is now dean of Columbia Business School. Navarro, a Democrat, is a business professor at the University of California, Irvine and author of “The Coming China Wars.”
Get ready for the Long Recession.
Well, at least a long period of time where it is going to seem like the US economy is kind of sickly. That is the conclusion of productivity guru Robert Gordon in a new paper. He says US living standards now face their slowest two-decade growth rate “since the inauguration of George Washington.” More:
From the great David Goldman:
When Reagan took office in 1981, the baby boomers were in their 20s and 30s, America had a 10% savings rate, the current account was in surplus, and America was the world’s largest net creditor nation. Reagan was able to cut taxes and finance an enormous budget deficit because the world’s demand for US Treasury securities was correspondingly large. In 2010, the baby boomers are in their 50s and 60s, America has saved nothing for a decade, the current account remains in severe deficit and the world is choking on the existing supply of Treasury securities. Cutting taxes to stimulate the economy is not as simple this time round.
A quick exit for Larry Summers? That’s the goal of an incipient whispering campaign within segments of his own party. Detractors of the superstar White House economic adviser blame his deficit-phobia for a skimpy stimulus and resulting jobless recovery in the United States.
This commentary from GOP thought leader Rep. Paul Ryan of Wisconsin really sets the intellectual and political framework for where the GOP might be headed. He goes after Crony Capitalism, the melding of Big Money, Big Business and Big Goverment. This is what’s next. Here are some important bits:
Here is the list from New Scientist:
1. Base economic policy on scientific evidence
2. Legalize drugs
3. Give police your DNA
4. Find non-economic measures of success
5. Study climate geo-engineering to see if it would really work
6. Tax carbon and equally distribute the proceeds
7. Embrace genetic engineering
8. Protect the seas
9. Pay people to feed energy back into power grid
10. Move to a four-day work week