How about “economics for idiots” for all of us out there who might have trouble remembering what we have learned from the Great Recession as well as the Bush “build the rich” program of recent years? Thanks to the Times we have this today in easy to access fashion.
Here’s Alan S. Blinder, the Princeton professor and former Federal Reserve vice chairman’s “10-step recovery plan:”
- Remember that people forget
- Do not rely on self-regulation
- Honor thy shareholders
- Elevate risk management
- Use less leverage
- Keep it simple, stupid
- Standardize derivatives and trade them on exchanges
- Keep things on the balance sheet
- Fix perverse compensation
- Watch out for consumers
Here’s Joseph Stiglitz, Columbia professor and Nobel laureate, on how inequality is preventing financial recovery and growth.
- Weakens the middle class and their ability to drive the economy with consumer spending.
- Hollowing the middle class means that they are unable to invest in their future, by educating themselves and their children and by starting and improving businesses.
- Weakening the middle class is “holding back tax receipts” which means that “the government cannot make the vital investments in infrastructure, education, research and health that are crucial for restoring long-term economic strength.”
- Inequality is associated with more frequent and more severe boom-and-bust cycles.
Now if we could just get people to learn these lessons….