Monday, March 10, 2014
Robert Pollin — Public debt, GDP growth, and austerity: why Reinhart and Rogoff are wrong
Burying R & R deeper.
And still no discussion of differences in historical context, such as fixed versus floating exchange rates.
LSE
Public debt, GDP growth, and austerity: why Reinhart and Rogoff are wrong
Robert Pollin | Distinguished Professor of Economics at the University of Massachusetts-Amherst and Co-Director of the Political Economy Research Institute (PERI)
(h/t Brad DeLong)
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In their enthusiasm to weep and wail about debt, R&R have overlooked an elephant in the room: quantitative easing. That is, it’s perfectly feasible for any government to make its debt disappear in a puff of smoke by simply printing money and buying back the debt. And that’s what QE consists of.
I’ve Googled “Rogoff” and “quantitative easing” and didn’t find much. R&R probably realise subconsciously that QE is a problem for their debt phobia, so they just sweep QE under the carpet.
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