Galbraith: Short-Term Stimulus Not Good Enough

James Galbraith, interviewed by Henry Blodget, suggests that more “stimulus,” if this means a program that will run out in a couple of years, is not sufficient.  What we need, he insists, is something more like a “strategic plan” for the next 10-15 years, investing in growth and dealing with problems like energy, climate change, and infrastructure (and that laying this groundwork would ultimately shore up private sector confidence).  Galbraith is also careful to distinguish between concerns about private and public debt:  while private, household debt has been a problem for the US, he argues, the public debt is sustainable and should not be a concern.  His closing line is worth repeating:  “We’re a big country.  We can finance our own reconstruction if we choose to do so.”