Good interview from another economist, Mohamed El-Erian, joining the chorus of economists saying we need to spend more on things like infrastructure. He makes a good case for this spending.
I agree, but the problem is the government is already committed to spending huge sums of money on entitlements and the military. The tiny slice of the pie that's spent on things like infrastructure, research and education has to be increased in spite of the huge slices spent on these other things. That's difficult to wedge into tight budgets unless we find more revenue from taxes; most likely. Congress; especially this Republican Congress, drops the ball.
We could tax wealthy people more as I guess there is lots of money sitting on the sidelines.
Here's a far out idea that I didn't hear on this interview, but I have heard from other sources. Central banks, in nations around the world, have been printing money to stimulate their economies. They use the vehicle of low interest rates. This hasn't worked as well as one might think. Seems like much of the money just pools up on the sidelines as the business, that can borrow for cheap, still remain cautious about investing in bold projects.
One exception, of course, is someone like Elon Musk and his futuristic investment in Space X. Space X is an example of moving forward and creating interesting jobs. Most business is just kind of waiting or doing "business as usual, however." Space exploration is a new frontier which provides growth for the future economy. Also inspiration for learning among future generations. This is an example of focus, rather than just business as usual. Like so many economists, including in this interview, say, we need another Sputnik Moment. We need some new initiatives to prime the economic pump. Converting to cleaner energy, even just repair of crumbing infrastructure. The list of exciting needs is long and the work could be fulfilling for current and future generations. Business and government needs more initiative, I guess.
Seems like much of the money coming from just the present stimulus policy of low interest rates is feeding (I think) things like housing bubbles. Low interest rates means more money to spend buying a house and thus driving up existing house values; especially in areas where there's restriction on building new housing.
Why not use printed money to more directly fund infrastructure? That's kind of a radical idea of printing money to fund the government directly. Sometimes called "helicopter money;" an idea floated years ago about stimulating the economy by just giving some free money to people for spending in the economy. Well, maybe this idea can be revisited, but instead of helicopter money, using it carefully to create the added infrastructure spending that so many economists say we need.