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[1/N] My interview with @MESandbu in today's @FT covers a range of issues facing policy makers. My views on... https://www.ft.com/content/9dd38ca3-a07b-4905-813d-39261dbc3c91
[2/N] Fiscal Policy: Immediate need is health spending, widespread availability of vaccines, treatments, testing to end the pandemic everywhere. Next, to fix weak growth and other issues that predate this crisis, high quality and well implemented public investment needed.
[3/N] Debt: Increasing debt is a major concern, but there are good forms of public investment that create jobs while being fiscally prudent, when interest rates are low for long. To work well, it is important to have medium-term fiscal frameworks to ensure debt is sustainable.
[4/N] Climate change mitigation: This should be done using a three-pronged approach. i. Green public investment; ii. Gradually increasing scale of carbon pricing; iii. Compensation to lower income households to ensure affordability. This can boost growth, jobs, save the planet.
[5N] US: If the US were to do a 2 trillion dollar stimulus along the lines of the Cares Act that could raise US GDP next year by over 3%, bringing the US back to full employment more quickly. US needs to address rising inequality.
[6/N] Regional inequality has risen in advanced economies since the 1980s. Poorer regions no longer catch up with the rich. People are not as mobile in search of opportunities as previously thought. Place-based policies may be needed.
[7/N] Globalization: Greater integration won’t happen organically. WTO has been valuable in growing trade, but many issues remain. Appropriate WTO reforms are needed.
[8/N] IMF: This crisis highlights the need for international lenders of last resort. We’ve provided financing to 81 countries in this crisis including emergency financing. We have tailored our financing and advice to this crisis.
