The Fiscal and Economic Effects of Austerity

In Professor Summers’ testimony before the Senate, he sets out to do three things: First, he characterizes the economic and fiscal outlook. Second, he reflects on the economics of austerity, arguing that too little of the policy debate in recent years has focused on the imperative of increasing economic growth which, in the short and medium term, goes back to issues relating to demand. Third, he comments on some of what he sees as policy priorities for the years ahead.