The president is trying to please everyone, but he needs to take tough action to prevent the US economy's second freefall---Defeat in the Massachusetts senatorial election has deprived US Democrats of the 60 votes needed to pass healthcare reform and other legislation, and it has changed American politics – at least for the moment. But what does that vote say about American voters and the economy? Most Americans, however, are focused on today's downturn, not tomorrow's. Growth over the next two years is expected to be so anaemic that it will barely be able to create enough jobs for new entrants to the labour force, let alone to return unemployment to an acceptable level.
Unfettered markets may have caused this calamity, and markets by themselves won't get us out, at least any time soon. Government action is needed, and that will require effective and forceful political leadership.
Sunday, February 07, 2010
Stiglitz: "Obama's muddled solutions"