September 20, 2011

Fixing the Global Economy

A recent article I saw online caught my attention with its doom and gloom title "World economy enters 'dangerous new phase'. The article goes on to say what is needed to "fix" the global economy. Strong policies ranging from tax cuts to improving infrastructure should provide the stimulus needed to get the economy back on track. Well this article is clearly written with the mindset of the economy being an old clunker or rusty bolt. All that is needed is a little WD 40 to loosen it up or a little more gas and it will be up and running again. Oh by the way all this spending or decreasing of revenue is supposed to happen while the looming U.S. deficit and debt needs to be reduced according to the IMF to return the economy to health. However what I think is needed to return to health is not more injections but to allow healing to occur. While infrastructure may be key to any economy it should not be done at increasing debt. Allowing the economy to move on its own according to a plethora of plans rather than one might allow for growth. Many entrepreneurs working on many individual projects would seemingly outpace one plan by the government for jobs and ultimately growth. This would require no further spending and increased sales would bring in tax revenue. Perhaps not fixing the economy, maybe letting it recover would be a better course of action.

1 comment:

Spencer Baucke said...

very good point. It seems that every single economic analyst that writes on these issues is writing from the standpoint of, what is "wrong" with the "world economy," and what can we DO to "fix" the problems in the economy. Is the economy something that can be "fixed?" I don't think so. I think there are policies that can HELP protect the future prosperity of this nation, but as far as "fixing" the economy, I don't believe in that voodoo.