"Joe Biden’s ‘war economy’ policies are a radical break with the status quo." Telegraph

"Bidenomics is a heady brew. The Democrats’ $7.9 trillion blast of extra spending is a step beyond Roosevelt’s New Deal. It mimics the Keynesian expansion of the Second World War and consciously aims to run the economy at red-hot speeds of growth.

If enacted in full, it is large enough to lift the US economy out of the zero-rate deflationary trap of the last decade and entirely reshape the social and financial landscape.

The stimulus will be corralled inside the closed US economy by Joe Biden’s protectionist “Buy America” policies, his industrial strategy, and his carbon border tax (i.e. disguised tariffs against China). This limits leakage.

It is a laboratory of sorts for a post-globalisation experiment in what used to be called “reflation in one country” – before the free flow of goods and capital emasculated sovereign governments.

“It’s quite likely that, just as in World War II, when we push down on the economic accelerator, we will find that we have been running on one cylinder up until now,” said the Roosevelt Institute, now advisors to the Biden campaign.

This is why Moody’s Analytics estimates that Bidenomics accompanied by a Democrat clean sweep of Congress would lift American GDP by an extra 4.8pc, add an extra seven million jobs, and raise per capita income by an extra $4,800 over the next four years, compared to a clean sweep by Donald Trump. Economic growth would rocket to 7.7pc in 2022."  Telegraph

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Evans-Pritchard, the author of this piece baldly declares that the Trump tax cut failed to stimulate economic growth and that a clean sweep by the Democrats in November would lead  to massive GDP growth and a reduction in present economic inequalities in American society.

 

I will be very interested in your comments.  pl 

 

https://www.telegraph.co.uk/business/2020/10/06/joe-bidens-war-economy-policies-radical-break-status-quo/

Comments

[Richard Ong]

All we need to do is press down on the "economic accelerator." If only Trump had known about it our troubles would be over.

[Richard Ong]

@Babak makkinejad:

That's an excellent point. FDR's lunatic statism was imposed on a basically healthy economic system. The postwar recession evaporated in the face of government non-intervention and even the excesses later and Hoover's foolish interventions did not materially damage the underlying productive structure. Too, many more people lived on the farm.

The reality 90 years on is that debt is sky high and debt service is the monster under the bed who must not be provoked by higher interest rates. Low rates, however, have facilitated massive fiscal excess and monetary recklessness punishing savers, driving them into risk-on investments to find some return on savings and to try to stay ahead of or even with inflation. Cheap money has stimulated more marginal investment and massive deficits have meant investments driven by political considerations. Think stock buybacks (massive) and Solyndra. Women have been driven into the workforce just to pay the taxes (plus childcare) to which add the burden of massive student debt and higher taxes, esp. employment taxes. Plus soaring health care insurance costs and job theft, wage suppression, and welfare cost of massive third-world, illegal immigration and massive job loss from malevolent off-shoring. Plus massive regulation and "climate change" dishonesty.

We aren't in Kansas any more.