You can lead business to credit, but you can't make them borrow. Two more points: (1) Easy credit/low % rates, in many countries, was the cause of their troubles (2) Using central banks to stimulate an economy is to misuse the bank. As an old school monetarist, I can only sadly shake my head at the idea that a central bank should play any role in stimulating economic growth. Price stability is the alpha and the omega.
May I modestly point out, the quality of Congress will only be as good as the quality of the voters who put them into office. I do not believe the voters are capable of living with representatives who, through program cuts and higher tax rates, put the fiscal house back in order. BOTH parties, upon the alter of electoral success, have offered the voters what they say they want, a free lunch. Any economist of any stripe will quickly state, there is no such thing.
I lectured on Federal Fiscal Policy from the late 70's until the early 2000's. THE problem has always been the American Voter does not want to pay for the government services received. The Laffer Curve, trickle down economics, supply side economics, support the job creators, et.al.; all excuses to spend without raising tax revenues. The political truth is that, to get the fiscal house in order, government spending must be capped (or reduced) and tax rates, for the rich AND the middle class, must go up. Not to worry, both political parties know that the public will not support anyone who supports this so, nothing of significance is going to change. More's the pity.
Mr. Marshall, your personal attacks (Joseph Stieglitz=rotten socialist innards) do nothing to aid in the rebuttal of a position. All too often certainty blinds us to other viewpoints. The only time a person learns (grows intellectually) is when they are confronted with something entirely new or something that contradicts what they already believe to be true. They see they need to change their frame of reference. After being involved in economics for almost 40 years, the one thing I know is that economics (like politics )will always exist and there will always be disagreements on how it should be conducted.
Hello Mr. Marshall, All viewers of this web site should be grateful you saw fit to reveal the path of economic wisdom to the former chief economist of the IMF. It must be intellectually comfortable; knowing with certainty your understanding of economics is comprehensive and true. With the irrefutable economic counterpoint to Mr. Johnson, he may be tempted to leave the profession. It is obvious your academic/private sector education/experience lends itself to an advisory position in any public or private organization. Their gain would be our loss.