Joseph Middot; Steiglitz
Economics in the world are popular in response to coronary viruses, and the time to implement the blockade policy is not long, but it feels like hundreds of years.In the early days of the crisis, most people believe that the economy only needs to be suspended for a period of time, and it will rebound quickly after reopening.It takes two months to take care of it for two months, and with the support of a lot of funds, the economy will continue to sing high.
It sounds attractive.But now it has reached July, and the V recovery may be just a fantasy.The economy is likely to be sluggish.This phenomenon is not only in those countries that have not controlled the popularity (that is, the United States), but even appear in those (handling epidemic) countries with good performance.The International Monetary Fund (IMF) predicts that by the end of 2021, the global economic scale will barely exceed the end of 2019, and the economic scale of the United States and Europe will still be reduced by about 4%.
The current economic prospects can be viewed from two levels.Macroeconomics tells us: expenditure will decline, because the assets and liabilities of households and enterprises will be weak; bankruptcy tide will destroy organizational and informatization capital;Take high -intensity prevention measures.
At the same time, microeconomics tells us that the virus seems to treat activities that contain close contact with human beings as the target of taxation. If humans want to conduct these activities, we must pay health and other costs.As a result, the virus will continue to promote the huge changes in consumption and production models, which will bring a broader structural change.
From the economic theory and history, we all know that to deal with this change, it is not enough to rely on the market alone, especially considering that this change is so sudden.It is not easy to transform airline employees into Zoom technicians.Even though we can do so, the number of labor for those in the expansion industry is far lower than the industries that are being replaced, and the level of skills required is higher.
We also know that according to the income and alternative effects referred to by economists, extensive structural reforms often cause traditional Keynesianism.Even if there is no (human) contact department is expanding (which reflects its relatively attractive improvement), the increase in related expenditures will be offset by the decrease in expenditure caused by the decline in the revenue of the shrinking department.
In addition, in terms of popularity, the third impact will have: inequality exacerbates.Because machines are not infected by viruses, they are relatively more attractive to employers, especially for contracting industries that use relatively non -skilled labor.Moreover, due to the expenditure ratio of low -income people in basic daily necessities, it is higher than the upper population, and any inequality driven by automation will be shrinkable.
In addition to these problems, there are two reasons for pessimism.First of all, although monetary policy can help some enterprises to deal with temporary liquidity restrictions, just like from 2008 to 2009, it can neither solve the problem of solvency, nor can it be that the interest rate is close to zero.Stimulate the economy.
In addition, in the United States and other countries, conservative opposition to rising deficit and debt levels will hinder the necessary financial stimuli.To be sure, these people are very happy to reduce taxes for billionaires and enterprises in 2017, save Wall Street in 2008, and help large enterprises this year.But it is another matter to expand unemployment insurance, healthcare and additional support for the most vulnerable groups.
Since the beginning of the crisis, short -term priorities have been clear.The most obvious is that the urgency of hygiene must be resolved, such as ensuring sufficient personal protection equipment and hospital capacity, because unless the virus is controlled, it is impossible to achieve economic recovery.At the same time, policies such as protecting the people who need help, provide liquidity policies to prevent unnecessary bankruptcy situations, and maintain the connection between workers and enterprises. For ensuring that enterprises seize opportunities, it is important to restart quickly.
But even if these points are obvious, we still need to make difficult choices.We should not help those companies that have been going downhill before the crisis, such as some old retailers, which will only create zombies and ultimately restrict market vitality and economic growth.We should not help those companies that are already liabilities and cannot bear any impact.
It is almost certain that the decision to support the junk bond market for the Fed's asset purchase plan is a mistake.In fact, in this example, moral risk is indeed a example worthy of attention; the government should not protect companies that are harmed by their stupid behavior.
Because coronal virus disease is likely to accompany us for a long time, we still have time to ensure that expenditure can reflect our priority matters.When the popularity arrived, American society was split -out due to ethnic and economic inequality, decreased health level, and destruction of fossil fuel.At present, the government's expenses are getting higher and higher, and the public has the right to ask companies that accept help to contribute to the fairness of society and race, improve health, and have a greener and more intellectual economic transformation.These values should not only be reflected in how we allocate public funds, but also in the conditions we applied to the assistant.
In the recent research, my co -author pointed out that targeted public expenditure investment, especially in terms of green transformation, can bring more benefits than tax cuts.This will be timely, highly demand for labor, strong stimulation, and help solve the problem of continuous unemployment rates.Countries, including the United States, have adopted a large -scale and continuous recovery plan, and have a sufficient economic basis.These plans will stabilize or make them closer to their claim.
Author Joseph E.Stiglitz is the Nobel Prize winner, a professor at the University of Columbia, chief economist of Roosevelt Institute, and former senior vice governor and chief economist of the World Bank.His latest works are the people's, power and profits: PEOPLE, Power, and Progressive Capitalism for An Age of Discontent, which are dissatisfied with the times.
English Title: Priorities for the Covid-19 Economy
Copyright: Project Syndicate, 2020
