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We Need a Second Stimulus Immediately, Says James Galbraith

Posted Nov 20, 2009 10:02am EST by Henry Blodget in Investing, Recession, Banking
Related: ^dji, ^gspc, xlf, dia, spy

A fight has broken out among economists about whether what ails the country is too much spending or too much debt.

Debt fear-mongers, such as Niall Ferguson, believe that the country's wild borrowing and spending spree has put us on the road to ruin.

"Stimulists," such as Paul Krugman and our guest, professor James K. Galbraith of the Univ. of Texas, believe that spending aggressively and piling up debt is by far the lesser of two evils and that we need to launch a second stimulus immediately. 

Why do professors Krugman and Galbraith believe this? 

Because, in their opinion, skyrocketing debt is far less of a concern than letting the country's people and productive capacity lie fallow for the decade or more that it will take back to get to full employment.

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