Friday, July 17, 2009

From the "Since you asked…" file.

Professor Krugman inquires
The American economy remains in dire straits, with one worker in six unemployed or underemployed. Yet Goldman Sachs just reported record quarterly profits — and it's preparing to hand out huge bonuses, comparable to what it was paying before the crisis. What does this contrast tell us?
Since you asked, it tells us, or me, at least, that if it's jobless, it isn't a "recovery," the fortunes of financial manipulators notwithstanding.

Krugman's own answers are pretty good, too.

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2 Comments:

Blogger libhom said...

It also shows us that we need to do more to address income inequality, like making the rich pay their fair share in taxes.

7:04 AM  
Anonymous Terry Parkhurst said...

Well, "fair share" is always going to be a debatable thing. If tax rates go up too high, then the rich take all their money and park it in Swiss bank accounts.

Of course, the theory that the Libertarians and other "free market" believers would have us buy, is that if things are made easier for investors, then those folks with money to spare will put money into start-ups; thus, creating jobs. But with all due respect, how often does that happen?

I heard an English economist on the radio yesterday - KIRO-FM - whose name I didn't catch. But he had something interesting to say. We need to become a country that invests money to produce (especially for export) rather than being - remaining - a country that borrows to spend.

But just as in individual humans, breaking a country's bad habits, is a tough thing to do. Personally, I just hope that the deal between FIAT and Chrysler holds up. Chrysler plants are just re-opening. It would be a shame to see the deal fall through now.

10:23 PM  

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