Afternoon Must-Read: Joseph E. Stiglitz: Stagnation by Design

Joseph E. Stiglitz: Stagnation by Design: “Markets are not self-correcting.

The underlying fundamental problems that I outlined earlier could get worse–and many are. Inequality leads to weak demand; widening inequality weakens demand even more; and, in most countries, including the US, the crisis has only worsened inequality…. Markets have never been very good at achieving structural transformations quickly on their own…. The sectors that should be growing, reflecting the needs and desires of citizens, are services like education and health, which traditionally have been publicly financed, and for good reason. But, rather than government facilitating the transition, austerity is inhibiting it…