I found this write-up on msn.com in their Money section. It discusses 7 ways, multiple, economist think the US Economy can be improved. The economist featured in the article all agree the economy is showing signs of improvement but it will not see the same healthy state until the job market directly changed. This article is exhibiting the idea that through the government assisting in the creation of new jobs and the improvment of current jobs, will improve the US's Economy. This will increase the amount and wealth of consumers in all markets,fueling the markets. In return improving the state of the Economy.
The 7 ways addressed are some-what simple but more difficult actualy to accomplish:
Extend the payroll-tax holiday not; "not long term, just 1-2 years."
Spend federal dollars to put the jobless to work; "defecit spending genearting jobs."
Build out the nation's infrastructure; "the impact of fiscal stimulus on financial, commodity, labor and household markets."
Free the markets; "Stop introducing new stimulus policies, both fiscal and monetary.
Bring back the 1990s; "We need two things simultaneously: short-term fiscal stimulus and a long-run return to the fiscal responsibility of the 1990s."
Repair aging roads and bridges; "The best thing the government could do is return to pre-2001 tax policies and use the (additional) revenue to invest in public infrastructure."
Fix the tax code; "Say what you want about the wisdom of raising taxes on the rich, but there's no evidence that doing so will lower unemployment or spur growth."
Through government intevention there is hope of improving the job market and in return improving the economy. This can seem appealing considering the fact that both sides can get actual benefit from the improvements. The government recieves hope of carry over improving the health of the Economy and cunsumers get the improvement of personnal living. Maybe the way of improvement is through improving the job market.
http://money.msn.com/investing/7-ways-to-fix-the-economy
8 comments:
I found this a bit contradictory. If one of the ways is to "Free the market: "Stop introducing new stimulus policies, both fiscal and monetary" then why are the other ways also got mentioned, where they are essentially stimulus fiscal policies (repair aging roads and bridges, spend federal dollars to put the jobless to work, build out the nation's infrastructure, etc.) ?
As it is not unusual that there are no absolutely answers for economic problems, I believe the 7 ways addressed in the article are reasonable to some extent. However, in my opinion, “deficit spending generating jobs” is probably not a desire policy the public/governments want at this moment. The debt problem is impending and intractable. Also, as Hao mentioned, it seems that this article is contradictory at some point. “Free the market”, and then “short term fiscal stimulus…”? Last, I agree that government invention at this moment is necessary; however, what policies are needed and how to implement them are complex.
I agree with some of these steps. Mainly, "Bring back the 90's" and "fix the tax code." I agree that there is no evidence that doing so will lower unemployment or spur growth. However, we are close to 15 Trillion in debt some extra cash from the 1 per-centers couldn't hurt.
It's always easier said than done, some of the afore mentioned solutions appear rather difficult to achieve within the current economic condition.
Spending federal dollars to put the jobless to work, spending federal dollars to put the jobless to work, building out the nation's infrastructure, and repairing aging roads and bridges all sound good on paper but these solutions require trillions of dollars to execute. Given the huge amount of government debt, the American government is unlikely to be in a position to carry out these plans without hurting its long term economic autonomy.
I believe what we need is changes in the structure of the economy and politic. For example, a tax overhaul similar to the one in 1986, and the way the government intervenes the economy. As we can see in the past, leaving the market alone would create problems.
I agree with An I feel that we are past the notion of an automatically correcting market, and it is very apparent that the government and the fed need to take the correct measures to get the economy back on the right track.
I think that "bringing back the 1990s" will be very difficult because there were bubbles that lead to the economic success including the dot-com bubble. While this did prove to have economic success in the short term, I would guess that in the long run we would still face economic downturn and possible future recessions and depressions. Although I think that if we were to find the next big money maker it may help us, at least temporarily have economic growth.
I agree with Hao and think this article is kind of contradictory. Invest in infrastructure would stimulate the current economy but this contradicts to a free market concept with heavy government intervene. Also, government spending is already too much and the government is facing shutting down months ago because budget proposal cannot make a consensus.
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