A few months ago Karl Smith, an Assistant Professor of Public Economics and Government, at the UNC-CH School of Government launched a blog where he posts his thoughts and analysis about NC’s economy. Economic analysis is often complicated and impractical. Karl’s blog is not like that at all. He gives his take on controversial questions, like is the “Fair Tax” really fair, and he shares his assessment of the latest state-level economic indicators. I particularly enjoyed his latest post where he looks at the question “Is the Stimulus Big Enough?” First he gives all the facts and figures about how much the economy has really shrunk and then concludes the following:
So, with stimulus closing at best half of the output gap and the housing and financial markets still on the fritz, what can we expect. At this point I for see a long slow recovery.
Even though the recession is technically over, it won’t feel over until well into 2010 and we wont see unemployment back under 6% until at least 2015. That’s five more years of an economy that weaker than what we’ve grown accustom to.
Now there is some chance that monetary policy could change that. That the Federal Reserve could do some things to juice up growth. However, this is currently a major area of debate among economists and the Federal Reserve has not yet signaled that it is willing to do those things.
If you want an easy way to learn more about how the economy works and how public policy shapes it I recommend adding North Carolina Economics to your web browsing repertoire.