Post by account_disabled on Mar 4, 2024 22:47:32 GMT -5
The coronavirus crisis is exacerbating already known problems (precariousness, inequality) and others that derive from them (bottlenecks in the distribution of goods, incipient inflation). But, at the same time, this allows us to consider the errors of our production model, and the possible ways to redirect it. It is about not avoiding strategic thinking, strategic planning, to observe new horizons for more inclusive growth, with the essential axes of the United Nations SDGs. It is urgent to avoid the mistakes made after the outbreak of the Great Recession, when bailouts allowed corporations to further increase their profits at the end of the crisis, without shoring up the foundations for a solid and inclusive recovery. The strategic basis is built on an expansion of public investment, an approach that seems to have permeated European reconstruction plans. With the coronavirus crisis, the State and economic institutions are once again being main actors: protagonists in the important scope of monetary policy, and forgers of pacts in fiscal policy.
This involves providing immediate solutions, designed in such a way that they serve the public interest in the long term. The strategic basis is built on an expansion of Australia Phone Number public investment, an approach that seems to have permeated European reconstruction plans. Resources must be obtained immediately from credit requests and/or direct capital transfers, in the form of perpetual debt. And all this must be conditioned, in this stage of great investment need, to greater flexibility on the part of the ECB in its requirements and demands. The return of the debt should be one of the great European debates, thus favoring a more symmetrical recovery. If the debt is to be made viable, with different restructuring plans, the advance of public investment is going to be crucial, with overcoming the idea of a naive State that pays for damages and “socializes” them, but that is harmless to demand compensation from those who help.
On the contrary, expansive austerity policies have not led, in the immediate past, to a significant contraction of the debt/GDP ratio, but rather this ratio has increased. But these results – as we have already written on other occasions – do not discourage the proposals for expansive austerity, observable in contributions by the late Alberto Alesina (The Effects of Fiscal Consolidations: Theory and Evidence, Cambridge, MA, ) and his numerous and unconditional followers. The coronavirus crisis has revealed both the weakness of our economy and social protection system, and the need to overcome it through planned collective action, in solidarity and in cooperation with the rest of the world. Public investment must play a fundamental role in this scenario. Fiscal consolidation measures, if applied, will lead to economic stagnation: more contradictions in the south and in the most vulnerable social classes.
This involves providing immediate solutions, designed in such a way that they serve the public interest in the long term. The strategic basis is built on an expansion of Australia Phone Number public investment, an approach that seems to have permeated European reconstruction plans. Resources must be obtained immediately from credit requests and/or direct capital transfers, in the form of perpetual debt. And all this must be conditioned, in this stage of great investment need, to greater flexibility on the part of the ECB in its requirements and demands. The return of the debt should be one of the great European debates, thus favoring a more symmetrical recovery. If the debt is to be made viable, with different restructuring plans, the advance of public investment is going to be crucial, with overcoming the idea of a naive State that pays for damages and “socializes” them, but that is harmless to demand compensation from those who help.
On the contrary, expansive austerity policies have not led, in the immediate past, to a significant contraction of the debt/GDP ratio, but rather this ratio has increased. But these results – as we have already written on other occasions – do not discourage the proposals for expansive austerity, observable in contributions by the late Alberto Alesina (The Effects of Fiscal Consolidations: Theory and Evidence, Cambridge, MA, ) and his numerous and unconditional followers. The coronavirus crisis has revealed both the weakness of our economy and social protection system, and the need to overcome it through planned collective action, in solidarity and in cooperation with the rest of the world. Public investment must play a fundamental role in this scenario. Fiscal consolidation measures, if applied, will lead to economic stagnation: more contradictions in the south and in the most vulnerable social classes.