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.
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.
