Must-Read: Nick Bunker writes: Over at Bloomberg, Peter Gosselin points out the costs of contractionary fiscal policy during the current recovery:
Government Austerity Exacts Toll on U.S. Jobs, Wages and Growth: "If federal, state and local governments were cutting taxes:
...increasing spending and expanding hiring as they did during all but one recovery since World War II, the economy would be growing 3 percent a year rather than slightly over 2 percent, the average of the past six years, according to a Bloomberg analysis of data. Some 2.4 million more Americans would be employed, helping to push up lagging wages, the analysis estimates.
Brad DeLong: We’re running the most contractionary fiscal policy in the postwar era, and probably for longer, at a time when the case for an expansionary one could not be stronger...