Jobs are Priority (For Now), Not Spending and Debt Reduction

There is a lot of recent evidence among countries and regions that the best policy in a grave economic crisis and recession, the central issue is to create jobs as fast as you can, even if this means running a large deficit over the short-term.  More growth will cause tax revenues to increase over the medium-term.

The broad pattern is clear: the more that governments have worried about enabling future moral hazard by excessive bailouts and sought to stem the rise in public debt, the worse their countries’ economies have performed. The more that they have focused on policies to put people back to work in the short run, the better their economies have done.

via A Time to Spend by J. Bradford DeLong – Project Syndicate.