Spring Break
Professors discuss economic crisis
A&M society ask questions about stimulus plan, auto bailout
By: Calli Turner
Issue date: 2/19/09 Section: News
|
The professors were participants in the A&M Economics Society's Financial Crisis Panel Discussion.
One of the issue that was discussed was the stimulus plan.
"The stimulus, like any fiscal stimulus, is supposed to create jobs. It's not as great a plan as it's supposed to be, it's not as deep as it's supposed to be, it's not as big as it's supposed to be," Gawande said.
He said the economic situation is not like the Great Depression for a couple of reasons. He said during that time, there was a deficiency in demand, but the rest of the economy was OK.
"The problem right now is the consumers are so heavily indebted as a group that they are not willing to spend," he said. "It's a tough time for this economy, there are no very easy answers."
Jansen said some think that an increase in job development indicates an upward turn in the economy.
"I would be a little bit skeptical about how well the proposed package or actual package will work to create new jobs," he said.
"Most economists will say [new jobs] can never be measured actually," Jansen said.
Gawande said the focus needs to be placed on banking systems because many banks may be close to or even at bankruptcy but are still operating.
"You can't let these guys just operate when they're bankrupt, they'll do all kinds of crazy things," he said.
But Gawande said banks that do work are needed.
The Federal Reserve System was noted as one of these banks.
"The Fed has been out there basically discounting all kinds of assets basically trying to conduct an open market of sorts," Gawande said. "It actually has succeeded, but it's not clear how much lending is coming from that."
Be sure to include your name, major, and class year. Submissions without this information are subject to deletion.
By submitting a comment, you agree to thebatt.com's Terms of Use.
You may also send a Mail Call to The Battalion at mailcall@thebatt.com