Deficit v. Stimulus: The Wrong Debate

“By focusing all our attention on whether we need a bigger stimulus or a smaller deficit, we’re flying blind.” TNR says we should concentrate on deeper reforms toward a knowledge based economy: “Government should be proposing policies that will help to create a new geography and a new way of life to sustain and support [a knowledge based economy]. But that doesn’t mean we need a centralized public bureaucracy to speed the process of change. As it happens, innovation occurs not only within big companies, major laboratories, and research universities, but also on the margins of business and academia.”