Let me put it very forcefully: No large economy has ever recovered from an economic downturn through austerity. It's not going to happen in the United States, and it's not going to happen in Europe.
Interpretation
Austerity measures do not lead to economic recovery after downturns.
Joseph Stiglitz argues that implementing austerity measures, which involve reducing government spending and budgets, has never successfully led to recovery from economic downturns in large economies. He asserts that such an approach will not bring about recovery in the United States or in Europe, suggesting that more proactive fiscal policies are necessary for economic revitalization.
In practice
This quote can be used in a conversation about government policy reforms to highlight the importance of spending during economic crises.
Free migration within Europe means that countries that have done a better job at reducing unemployment will predictably end up with more than their fair share of refugees. Workers in these countries bear the cost in depressed wages and higher unemployment, while employers benefit from cheaper labor.
I don't think we can have democracies that work where most of the people are not benefiting economically, where most of the people are worried about their job security.
What separates developing countries from developed countries is as much a gap in knowledge as a gap in resources.
One of the arguments I make for the failure of the euro is that, at the time it was being constructed, there was a 'neo-liberal' ideology which said that all we need to do to make this thing work is to get deficits low, keep inflation low, and take down barriers, and then everything would be fine.
Trump sees the world in terms of a zero-sum game. In reality, globalisation, if well managed, is a positive-sum force: America gains if its friends and allies - whether Australia, the E.U., or Mexico - are stronger. But Trump's approach threatens to turn it into a negative-sum game: America will lose, too.
We have a locale-based education system; we have increasing economic segregation. We clearly need a larger federal program to try to help disadvantaged districts.
The economic dynamic in Zimbabwe is perversely robust: while ordinary people suffer, black-market dealers and people with foreign bank accounts prosper, making them powerful stakeholders in the perpetuation of devastating economic policies.
Regulation has gone astray. . . . Either because they have become captives of regulated industries or captains of outmoded administrative agencies, regulators all too often encourage or approve unreasonably high prices, inadequate service, and anticompetitive behavior. The cost of this regulation is always passed on to the consumer. And that cost is astronomical.
People who live in poor countries have to be entrepreneurial even just to survive.
Economics has been incurably growth-oriented and addicted to everybody growing richer, even at the cost of exhaustion of resources and pollution of the environment.
The only way America can reduce the long-term budget deficit, maintain vital services, protect Social Security and Medicare, invest more in education and infrastructure, and not raise taxes on the working middle class is by raising taxes on the super rich.
In reality there is no such thing as an inflation of prices, relatively to gold. There is such a thing as a depreciated paper currency.
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