Lawrence Summers on the economy

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>   (email exchange)
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>   On Mon, May 24, 2010 at 6:50 PM, wrote:
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SUMMERS: “FOR MILLIONS OF AMERICANS, THE ECONOMIC EMERGENCY GRINDS ON” – WH adviser Larry Summers spoke to the Johns Hopkins School of Advanced International Studies today: “[T]he observation that the economy is again ascending does not mean that we are out of a very deep valley. Far from it when we are nearly 8 million jobs short of normal employment and about $1 trillion – or $10,000 per family – short of the economy’s potential output and income and when recent events in Europe have introduced uncertainty into the prospects for global growth. Shortfalls in output and employment stunt the economy’s future potential as investment projects are put off and as the skills and work habits of the unemployed atrophy. This last point is especially important when for the first time since the Second World War the typical unemployed worker has already been out of work for more than six months. And behind these statistics lie millions of stories of Americans who have seen the basic foundations of their economic security erode. Beyond the economic projections and equations we economists make lie the struggles of communities devastated by the impact of this recession.Whatever the judgments of groups of economists about the official parameters of the recession and the growing signs of recovery, for millions of Americans the economic emergency grinds on.”

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>   So why doesn’t he damn well do something about it?
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Because we’ve run out of money.

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