December 01, 2008 - By New
York Times Writer Paul Krugman
I’ve been ruminating over economic prospects for next
year, and I’m getting scared.
Two points:
1. The economy is falling fast. We’ll see what tomorrow’s
employment report says, but we could well be losing jobs at
a rate of 450,000 or 500,000 a month.
2. Infrastructure spending will take time to get going — a
new Goldman Sachs report suggests that projects that are “shovel-ready” are
probably only a few tens of billions worth, and that a larger
effort would take much of a year to get going. Meanwhile, it’s
very questionable how much effect tax rebates will have on
consumer demand. So it may be hard for stimulus to get much
traction until late 2009 — and that’s even if Congress
goes along, which may be a problem given all the bad analysis
and disinformation out there.
So here’s what I’m wondering: will it, in fact,
even be possible to pull the economy out of its nosedive before
unemployment goes into double digits? I’m starting to
wonder. Read more of Paul
Krugman's Articles
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