How The Recovery Went Wrong Summary
Nick Jensen
Webber International University
MBA632 – How the Recovery Went Wrong
7/6/2012
How the Recovery Went Wrong
In “How the recovery went wrong”, Mr. Golub argues that even though the economy is moving in the right direction, it is the slowest and worst recovery from a recession in the last 60 years. Mr. Golub points out that all recoveries will “go in the right direction” by definition but in spite of President Obama’s continuous reassurances of the economy’s positive development, going in the right direction is not enough. The two most significant indicators of a recovery, job growth and GDP growth, show below-average figures and backs up Mr. Golub’s claims. Both indicators rank at the bottom of the 11 recoveries through the last 60 years and signify the economic problems. The government has used all the tools available to get the economy going as an attempt to make people spend …show more content…
In fact, the low interest rates have been more beneficial for the government, banks, and homeowners rather than businesses and individuals. The stimulus that has been in effect since 2008 now amounts to a total of $5 trillion which is a third of the annual GDP and it is likely that he large stimulus package will have a momentary positive effect. However, Mr. Golub believes that the money has been invested in projects, institutions and industries that haven’t showed any positive results. For example, huge amounts of money was spent on government employees, training programs that turned out to be failures, and unemployment benefits which discourages individuals from searching for jobs. Instead, the money should have been spent on initiatives that can sustain the economy in the long run like “building infrastructure or other assets that will help the nation create wealth over
Webber International University
MBA632 – How the Recovery Went Wrong
7/6/2012
How the Recovery Went Wrong
In “How the recovery went wrong”, Mr. Golub argues that even though the economy is moving in the right direction, it is the slowest and worst recovery from a recession in the last 60 years. Mr. Golub points out that all recoveries will “go in the right direction” by definition but in spite of President Obama’s continuous reassurances of the economy’s positive development, going in the right direction is not enough. The two most significant indicators of a recovery, job growth and GDP growth, show below-average figures and backs up Mr. Golub’s claims. Both indicators rank at the bottom of the 11 recoveries through the last 60 years and signify the economic problems. The government has used all the tools available to get the economy going as an attempt to make people spend …show more content…
In fact, the low interest rates have been more beneficial for the government, banks, and homeowners rather than businesses and individuals. The stimulus that has been in effect since 2008 now amounts to a total of $5 trillion which is a third of the annual GDP and it is likely that he large stimulus package will have a momentary positive effect. However, Mr. Golub believes that the money has been invested in projects, institutions and industries that haven’t showed any positive results. For example, huge amounts of money was spent on government employees, training programs that turned out to be failures, and unemployment benefits which discourages individuals from searching for jobs. Instead, the money should have been spent on initiatives that can sustain the economy in the long run like “building infrastructure or other assets that will help the nation create wealth over