Thursday, May 05, 2011

Build while it's cheap

Andrew Samwick, Dartmouth economist, writes:
with aggregate demand lower by hundreds of billions of dollars a year, there are unemployed and underemployed workers and underutilized capital whose services could be purchased on the cheap. If we have projects that add long-term value, this is the right time to be undertaking them. Plenty of those projects are to repair and maintain our seriously degraded infrastructure. Others are to make the upgrades necessary to plan for a future with different forms of energy transmission and communication. Instead of fighting about which multiplier is the biggest and clingng to the misguided notion that all measures be "timely, targeted, and temporary," we should be building while it's cheap.

We should have started this years ago. Given the continued worry about the fragile state of the recovery, we should start it now.

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