Found 290 article(s) for author 'Lawrence Summers'

There’s a revealing puzzle in the China tariffs

There’s a revealing puzzle in the China tariffs. Lawrence Summers, May 14, 2019, Opinion, “On Monday, China announced new tariffs on $60 billion of U.S. exports, and the United States threatened new tariffs on up to $300 billion of Chinese goods. These actions were cited as the principal reason for a decline of more than 600 points in the Dow Jones industrial average, or about 2.4 percent in broader measures of the stock market. With the total value of U.S. stocks around $30 trillion, this decline represents more than $700 billion in lost wealth. This was not an isolated event. Again and again in the past year, markets have gyrated in response to the state of trade negotiations between the United States and China.Link

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Can Free Markets Revive Brazil?

Can Free Markets Revive Brazil? Lawrence Summers, April 25, 2019, Audio, “Will a dose of free-market policies — from a populist politician, no less — finally bring Latin America’s biggest economy back to life? On this week’s episode of Stephanomics, Bruce Douglas visits the region’s busiest port to get a taste of what’s ailing Brazil — and the possible cure.  Host Stephanie Flanders also brings you the second part of her interview with Harvard University economist Larry Summers — the former U.S. Treasury secretary and Obama adviser — with his comments on Brazil’s economy and the new thinking on progressive U.S. fiscal policy. Finally, Stephanie talks with editor Catarina Saraiva about Bloomberg’s dreaded Misery Index.Link

 

 

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Further Thinking on the Costs and Benefits of Deficits

Further Thinking on the Costs and Benefits of Deficits. Jason Furman, Lawrence Summers, April 22, 2019, Opinion, “In recent months the debate over the future of fiscal policy has intensified. For example, Olivier Blanchard, in his presidential address to the American Economic Association this year, highlighted the implications of the empirical fact of sustained low real interest rates for fiscal policy, and others have debated the purported changes in the nature of economic theory itself—most notably modern monetary theory (MMT). In January we made our own contribution to the fiscal policy debate in Foreign Affairs. We offer here our current perspectives on a number of issues that have emerged as most salient in the months of discussion since then.Link

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Evolution or Revolution? Rethinking Macroeconomic Policy after the Great Recession

Evolution or Revolution? Rethinking Macroeconomic Policy after the Great Recession. Lawrence Summers, 2019, Book, “Leading economists discuss post–financial crisis policy dilemmas, including the dangers of complacency in a period of relative stability. The Great Depression led to the Keynesian revolution and dramatic shifts in macroeconomic theory and macroeconomic policy. Similarly, the stagflation of the 1970s led to the adoption of the natural rate hypothesis and to a major reassessment of the role of macroeconomic policy. Should the financial crisis and the Great Recession lead to yet another major reassessment, to another intellectual revolution? Will it? If so, what form should it, or will it, take? These are the questions taken up in this book, in a series of contributions by policymakers and academics. The contributors discuss the complex role of the financial sector, the relative roles of monetary and fiscal policy, the limits of monetary policy to address financial stability, the need for fiscal policy to play a more active role in stabilization, and the relative roles of financial regulation and macroprudential tools. The general message is a warning against going back to precrisis ways—to narrow inflation targeting, little use of fiscal policy for stabilization, and insufficient financial regulation.Link

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The IRS chief must release Trump’s tax returns — and Mnuchin must not stop him

The IRS chief must release Trump’s tax returns — and Mnuchin must not stop him. Lawrence Summers, April 8, 2019, Opinion, “The House Ways and Means Committee has requested access to six years of President Trump’s tax returns. Acting White House chief of staff Mick Mulvaney has vowed that there is no way Democrats will ever get to see the returns. Treasury Secretary Steven Mnuchin has indicated that he will comply with the law, but has not said what he thinks the law requires.Link

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A ‘wealth tax’ presents a revenue estimation puzzle

A ‘wealth tax’ presents a revenue estimation puzzle. Lawrence Summers, April 4, 2019, Opinion,“Sen. Elizabeth Warren (D-Mass.) recently proposed a 2 percent “wealth tax” on those worth more than $50 million. Emmanuel Saez and Gabriel Zucman, economists at the University of California at Berkeley, have played a major role in developing and validating this proposal. They estimate that the tax would raise $187 billion in 2019 (Warren’s additional 1 percent “billionaire surcharge” brings their total revenue estimate to $212 billion). This represents a substantial sum and has been widely quoted in both academic and policy discussions of wealth taxation.Link

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Fair, comprehensive tax reform is the right path forward

Fair, comprehensive tax reform is the right path forward. Lawrence Summers, March 28, 2019, Opinion, “Over the last several weeks, we have paid careful attention to tax proposals by Representative Alexandria Ocasio-Cortez of New York, for a 70 percent marginal tax rate on top earners, and by Senator Elizabeth Warren of Massachusetts, for a wealth tax on those worth more than $50 million.Link

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A broader tax base that closes loopholes would raise more money than plans by Ocasio-Cortez and Warren

A broader tax base that closes loopholes would raise more money than plans by Ocasio-Cortez and Warren. Lawrence Summers, March 28, 2019, Opinion, “Tax reform debates have been transformed in recent weeks by a shift in emphasis from revenue raising and progressivity to an emphasis on going after the rich for the sake of equality and justice. Bold proposals from Representative Alexandria Ocasio-Cortez of New York, for a 70 percent marginal tax rate on top earners, and from Senator Elizabeth Warren of Massachusetts — a 2020 Democratic presidential candidate — for a wealth tax on those worth more than $50 million have attracted widespread attention.Link

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On falling neutral real rates, fiscal policy, and the risk of secular stagnation

On falling neutral real rates, fiscal policy, and the risk of secular stagnation. Lawrence Summers, March 7, 2019, Paper, “This paper demonstrates that neutral real interest rates would have declined by far more than what has been observed in the industrial world and would in all likelihood be significantly negative but for offsetting fiscal policies over the last generation. We start by arguing that neutral real interest rates are best estimated for the block of all industrial economies given capital mobility between them and relatively limited fluctuations in their collective current account. We show, using standard econometric procedures and looking at direct market indicators of prospective real rates, that neutral real interest rates have declined by at least 300 basis points over the last generation. We argue that these secular movements are in larger part a reflection of changes in saving and investment propensities rather than the safety and liquidity properties of Treasury instruments.Link

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The left’s embrace of modern monetary theory is a recipe for disaster

The left’s embrace of modern monetary theory is a recipe for disaster. Lawrence Summers, March 4, 2019, Opinion, “We’ve seen this movie before. There is widespread frustration with the performance of the economy. Traditional policy approaches are not delivering hoped-for results. A relatively unpopular president is loathed to an unusual extent by a frustrated opposition party that lost the previous presidential election while running a pillar of its establishment. And altered economic conditions have led to the development of new economic ideas that reflect a significant break with previous orthodoxy.Link

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