Krugman also wants growth

January 3, 2011 § Leave a comment

Jobs, not G.D.P. numbers, are what matter to American families. And when you start from an unemployment rate of almost 10 percent, the arithmetic of job creation — the amount of growth you need to get back to a tolerable jobs picture — is daunting.

First of all, we have to grow around 2.5 percent a year just to keep up with rising productivity and population, and hence keep unemployment from rising. … Now do the math. Suppose that the U.S. economy were to grow at 4 percent a year, starting now and continuing for the next several years. Most people would regard this as excellent performance…

Yet the math says that even with that kind of growth the unemployment rate would be close to 9 percent at the end of this year, and still above 8 percent at the end of 2012. We wouldn’t get to anything resembling full employment until late in Sarah Palin’s first presidential term.

this suggests that growth is necessary for jobs and jobs are necessary for families. This s another piece of logic that has to be rethought. If we have an economy that does not need workers, even if it is growing, we need to think of other ways of distributing income. 30 hours a week? Sabbaticals? Come on leaders, we need some real imagination here.

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