End This Depression Now!
Looks at the economic downturn of the early 21st century, declaring it a depression, and outlines the steps that can be taken to reverse the trend and get back on the road to economic recovery.
A call-to-arms from Nobel Prize–winning economist and best-selling author Paul Krugman.
The Great Recession is more than four years old—and counting. Yet, as Paul Krugman points out in this powerful volley, "Nations rich in resources, talent, and knowledge—all the ingredients for prosperity and a decent standard of living for all—remain in a state of intense pain."
How bad have things gotten? How did we get stuck in what now can only be called a depression? And above all, how do we free ourselves? Krugman pursues these questions with his characteristic lucidity and insight. He has a powerful message for anyone who has suffered over these past four years—a quick, strong recovery is just one step away, if our leaders can find the "intellectual clarity and political will" to end this depression now.
For general readers with an interest in economic policy, this latest volume by Nobel Prize winning economist Paul Krugman examines the continuing effects of the recent economic crisis and makes a strong and well reasoned argument for the implementation of proactive progressive economic policies to promote growth. Addressing conservative concerns about deficits and inflation head on, Krugman contends that the traditional approach to growth crisis, targeted federal spending, is the solution to the current enduring downturn. Krugman is a New York Times columnist, a professor of economics at Princeton University, and a leading voice in American progressive economics. Annotation Â©2012 Book News, Inc., Portland, OR (booknews.com)
AgeAdd Age Suitability
SummaryAdd a Summary
Paul Krugman makes a strong case for governments and central banks to change their current policies, namely an increase of the inflation targets from the current 2% to a slightly higher 4%. Combined with government stimulus, his suggested medicine for the world economy is meant to restore employment to an acceptable level while the private sector is slowly trying to recover. "So this is very much a time to step on the gas pedal, not take our foot off it" Page 222. I can only agree with his approach as the Austerian approach in Europe and other parts of the world don't deliver the expected results. People may not like his suggestions but history shows that this is the right way to deal with the "Depression" and I quote: What can be done? One way is to find some way to reduce the real value of debt. Debt relief could do this; so could inflation, if you can get it, which would do two things: it would make it possible to have a negative real interest rate, and it would in itself erode outstanding debt. Yes, that would be rewarding debtors for their past excesses, but economics is not a morality play. (Pg. 147).
NoticesAdd a Notice
There are no notices for this title yet.
QuotesAdd a Quote
We can end this depression - and we need to fight for policies that will do the trick, starting right now." (Pg. 230)
Even euroskeptics like me realize that breaking up the euro now that it exists would have very serious costs. For one thing, any country that seemed likely to exit the euro (e.g. Greece) would immediately face a huge run on its banks, as depositors raced to move funds to more solid euro nations (Pg. 184) Moreover, an about-face on the euro would be a dramatic political defeat for the broader European project of unity and democracy through economic integration - a project that, as I said at the beginning, is very important not just for Europe but for the world" (Pg. 185)
What this adds up to is a very expansionary monetary policy from the ECB plus fiscal stimulus in Germany and a few smaller countries (Pg. 185)
...the ECB's mandate calls on it to maintain price stability - period. It's an open question how binding that mandate really is, and I suspect the ECB could find a way to rationalize moderate inflation despite what the charter says (Pg. 80)
But the Germans hate, hate, hate, the idea of inflation thanks to memories of the great inflation of the early 1920s (Curiously, there is much less memory of the deflationary policies of the early 1930s, which are what actually set the stage for the rise of you-know-who). (Pg. 180)
Workers are much less willing to accept, say, a 5 percent cut in the number of their paycheck than they are to accept an unchanged paycheck whose purchasing power is eroded by inflation (Pg. 164)
What can be done? One way is to find some way to reduce the real value of debt. Debt relief could do this; so could inflation, if you can get it, which would do two things: it would make it possible to have a negative real interest rate, and it would in itself erode outstanding debt. Yes, that would be rewarding debtors for their past excesses, but economics is not a morality play. (Pg. 147)
First things first: the Fed doesn't actually print money, although its actions can lead to the Treasury's printing money. What the Fed does, when it chooses, is buy assets - normally Treasury bills, aka short-term US government debt, but lately a much wider range of stuff. It also makes direct loans to banks, but that's effectively the same thing; think of it as buying those loans. The crucial thing is where the Fed gets the funds with which it purchases assets. And the answer is that it creates them out of thin air. (Pg. 153)
VideosAdd a Video
"End This Depression Now!" Paul Krugman
In this authoritative call-to-action, the 2008 Nobel laureate in economic sciences says that while the ongoing economic crisis qualifies as a depression, many nations have the talent and resources to turn things around
Find it at NYPL
Buy It Now
Support your library, keep it forever!View Purchase Options Learn more about this program
Hello! We noticed you have the following items in your cart right now:
If you'd still like to purchase the items you have in your cart, you can do that now.
You'll be able to purchase your eBook after you have checked out your current cart.
To continue with your eBook purchase immediately, you can clear your cart by clicking below.
All items will be removed from your cart.
I'd like to keep browsing! I'll decide later.