Posner’s on the sluggish recovery

Posted by Ricardo

Posner and Becker’s excellent blog is well worth reading (for those that don’t read it, they take a subject and each write a short post): the posts are not too frequent, and they are always high quality!

Their most recent subject is the sluggish recovery – and on this subject, I think Posner nails it. Posner argues that an increase in capricious regulation and uncertainty about the future (especially the regulatory environment, but that’s just among other things) is sapping animal spirits. Read more here.

I think Posner’s conclusion applies to Australia too — both directly, in that our multinationals suffer from global uncertainty (also our banks have to spend billions due to Dodd-Frank … for no benefit other than compliance) and directly in that the weak Federal Government lacks authority and therefore is unable to create certainty on any subject.

6 comments

on your Marx says:

June 21, 2011 at 09:41

what rubbish and lack of any evidence.

Lack of demand is the obvious answer.

This is why.
on your Marx says:

June 21, 2011 at 11:48

Brad DE Long beat me to it
1. Ricardo says:
  
  June 21, 2011 at 19:49
  
  Gets a bit circular, doesn’t it…
  
  Sent from my iPad
on your Marx says:

June 22, 2011 at 09:24

not really you merely need data.

I have to say there are better informed ‘conservatives’ on marco-economic policy than these two
1. Manny C says:
  
  July 9, 2011 at 08:08
  
  Data: http://marginalrevolution.com/marginalrevolution/2011/07/government-size-and-economic-growth.html
Manny C says:

July 9, 2011 at 08:13

That would explain the structural reasons for the US lacklustre economic growth. But I agree that lack of AD is exacerbating this. Unanchored NGDP expectations can do that when risks abound. Need the Fed to be more proactive and in the game. Bernanke needs grow a pair and take a few bullets staring down the cranky uncle in the House. Can’t have another Hooverian experiment in central banking indecision. that would be a disaster.