Compromise on backloading and inflation as best-of-worst (Romer NYT, Rogoff)
Prioritize central-government-law in Europe (Rogoff and me here)
Prioritize the business perspective (Johnson here, here, here)
Other well-known priorities for which I haven’t got internet references to hand:
Raise retirement ages automatically in line with life expectancy
Mandatory private retirement and medical insurance (or emulate Australia)
Tax simplification (flat tax or elimination of differentiation/deductions)
Public money on Schumpeterian technological/scientific R&D
Public money on the few natural monopoly areas of economic infrastructure
Reinstate structural adjustment (orthodox) conditionality for IMF rescues
Deregulate labour markets
First, do no harm
The lists lose differences between countries and the nuance in policy, and leave many factors out. But you get the idea. Growth is endogenous to economies, not a product of government spending. Choose policies that will be equally useful now (to restore dynamism) and later (to sustain growth), which won’t need to be reversed later, and which send clear signals about permanent commitments of government to balanced budgets and market freedom.
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The most important list is “the principles”. So here it is again:
Crisis-policy-principles:
1. Consider no policy during recession that would not be equally useful during prosperity.
2. Consider no policy whose intention is to evade or cushion the crisis.
3. Consider no policy that is not intended to be permanent.
Addendum: A useful post today by David Henderson about the regulatory burden on small business in the U.S.A. Imagine how much worse in most of Europe. Don't know why I forgot to even mention the word 'regulation' given it's such a crucial factor in recession entry and exit. Luke Johnson's business perspective was the intended substitute I hasten to add!
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In the United States and Europe, immigration tends to divide people into opposing camps: those who claim that newcomers undermine economic opportunity and security for locals, and those who argue that welcoming migrants and refugees is a moral and economic imperative. How should one make sense of a debate that is often based on motivated reasoning, with emotion and underlying biases affecting the selection and interpretation of evidence?
To maintain its position as a global rule-maker and avoid becoming a rule-taker, the United States must use the coming year to promote clarity and confidence in the digital-asset market. The US faces three potential paths to maintaining its competitive edge in crypto: regulation, legislation, and designation.
urges policymakers to take decisive action and set new rules for the industry in 2024.
The World Trade Organization’s most recent ministerial conference concluded with a few positive outcomes demonstrating that meaningful change is possible, though there were some disappointments. A successful agenda of reforms will require more members – particularly emerging markets and developing economies – to take the lead.
writes that meaningful change will come only when members other than the US help steer the organization.
Three crisis policy principles:
These principles have implications-in-common:
Boundary rules by living authors:
Random selections from a newish “I Agree” file:
Other well-known priorities for which I haven’t got internet references to hand:
The lists lose differences between countries and the nuance in policy, and leave many factors out. But you get the idea. Growth is endogenous to economies, not a product of government spending. Choose policies that will be equally useful now (to restore dynamism) and later (to sustain growth), which won’t need to be reversed later, and which send clear signals about permanent commitments of government to balanced budgets and market freedom.
Subscribe to PS Digital
Access every new PS commentary, our entire On Point suite of subscriber-exclusive content – including Longer Reads, Insider Interviews, Big Picture/Big Question, and Say More – and the full PS archive.
Subscribe Now
The most important list is “the principles”. So here it is again:
Crisis-policy-principles:
1. Consider no policy during recession that would not be equally useful during prosperity.
2. Consider no policy whose intention is to evade or cushion the crisis.
3. Consider no policy that is not intended to be permanent.
Addendum: A useful post today by David Henderson about the regulatory burden on small business in the U.S.A. Imagine how much worse in most of Europe. Don't know why I forgot to even mention the word 'regulation' given it's such a crucial factor in recession entry and exit. Luke Johnson's business perspective was the intended substitute I hasten to add!