Is Unemployment the New Normal?
Mainstream economists are preaching a decade of pain and historically high joblessness as if no alternative policy existed. Dean Baker thinks pessimism has run rampant.
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The willingness of economists to so quickly embrace this darker future is striking, says Dean Baker, co-director of the Centre for Economic and Policy Research. After all, one of the reasons that we have economists is, ostensibly, so that we don’t get such unpleasant news about a “new normal”. This is like a football team calmly accepting the sports writers’ prediction that they would have a winless season, and deciding that their new goal was to minimise the margin of defeat. … Economists really don’t have much basis for this lowering of expectations of their own and the economy’s performance.
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