Hello, Welcome to Known Unknowns, a newsletter that is an empiricist (thank you, David Hume), but also a rationalist (old-school kind, not the new Silicon Valley version). How much is too much? There is a strange economics argument brewing. The Biden administration has proposed a $1.9 trillion aid package, and even economists who are normally debt enthusiasts, like Olivier Blanchard and Larry Summers, are worried that it’s too big. Some relief is needed, but the important question is how much? Why should we spend more than what COVID cost the economy? Household balance sheets are in good shape, and once the economy opens, it’s poised to bounce back. So why give money to people who don’t need it?
Known Unknowns
Known Unknowns
Known Unknowns
Hello, Welcome to Known Unknowns, a newsletter that is an empiricist (thank you, David Hume), but also a rationalist (old-school kind, not the new Silicon Valley version). How much is too much? There is a strange economics argument brewing. The Biden administration has proposed a $1.9 trillion aid package, and even economists who are normally debt enthusiasts, like Olivier Blanchard and Larry Summers, are worried that it’s too big. Some relief is needed, but the important question is how much? Why should we spend more than what COVID cost the economy? Household balance sheets are in good shape, and once the economy opens, it’s poised to bounce back. So why give money to people who don’t need it?