New Year’s Hope against Hope

When the last year hasn’t gone so well, New Year's is a time for hope that the next one will be better. For Europe and the US, 2010 was a year of economic disappointment, and one can only hope that in 2011 their officials will finally stop listening to the financial sector's call for public-sector austerity and delayed restructuring of private-sector debt.

NEW YORK – The time has come for New Year’s resolutions, a moment of reflection. When the last year hasn’t gone so well, it is a time for hope that the next year will be better.

For Europe and the United States, 2010 was a year of disappointment. It’s been three years since the bubble broke, and more than two since Lehman Brothers’ collapse. In 2009, we were pulled back from the brink of depression, and 2010 was supposed to be the year of transition: as the economy got back on its feet, stimulus spending could smoothly be brought down.

Growth, it was thought, might slow slightly in 2011, but it would be a minor bump on the way to robust recovery. We could then look back at the Great Recession as a bad dream; the market economy – supported by prudent government action – would have shown its resilience.

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