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Tuesday, January 7, 2014

Dan Monaco interviews Peter Temin for The Straddler

Thinking Through the Savage Machinery: Peter Temin and Economic Crises

The problem of insufficient aggregate demand in America and Europe needs to be solved by an expansion of government spending. This means putting policies of fiscal austerity on hold and even temporarily reversing them. Debt problems of various sorts need to be managed to make this possible. Hegemonic leadership will be needed to set us on this course both internationally and in the United States and the Eurozone. The destabilizing [i.e., export-led] policy of Germany needs to change into one of domestic expansion to complement expansion in the Eurozone as a whole. And the destabilizing policy of China needs to change into one of domestic expansion to complement expansion in the West.[29]

Temin and Vines clearly hope that policymakers are among the readers of The Leaderless Economy

Policymakers don't read books; they read briefs prepared by their advisers

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