Economist Tyler Cowen isn’t the first to suggest the current economy, in which there is very limited growth and relatively high unemployment, may be “the new normal” that we will have to accept. I personally don’t accept it, because the current economic malaise, which has persisted for the entire Obama presidency, is more the result of left-wing economic policies (unprecedented growth of government, unprecedented deficit spending, unprecedented transfer of wealth, and needlessly high energy costs) rather than a flaw in the free market system. Anyway, Cowen writes:
Slowly but surely, we may be responding to these difficult revelations by scaling back our ambitions for the economy — reinforcing negative trends that were already underway. In this troubling view, we have finally begun to discover some unpleasant truths. Borrowing a phrase from the University of Toronto economist Richard Florida, it’s possible that we are experiencing a “Great Reset.”
In ither words, Americans might as well go ahead and embrace the new austerity in our own personal lives, but regardless of economic output, it is never stated that government must greet the new normal with austerity measures of its own.