What is a good economy? – Warren Mosler

“I just want to say a quick word about what a good economy is because it’s been so long since we’ve had a good economy. You’ve got to be at least as I am to remember it. In a good economy business competes for people. There is a shortage of people to work for business. Everybody wants to hire you. They will train you, whatever it takes.

They hire students before they get out of school or college. You can change jobs if you want to because other organisations and companies are always trying to hire you.

“That’s the way the economy is supposed to be but that’s all been turned around. For one reason, which I’ll keep coming back to, the budget deficit is too small. As soon as they started tightening up on budget deficits many years ago, we transformed from a good economy where people were the most important thing to what I call this ‘crime against humanity’ that we have today …

“So what you do is target full employment, because that’s the kind of economy everybody wants to live in. And the right size deficit is whatever deficit corresponds to full employment … ”

Source: Warren Mosler, from a talk given in Chianciano, Italy, on January 11, 2014 entitled “Oltre L’Euro: La Sinistra. La Crisi. L’Alternativa.”