Helicopter money !?

Martin Wolf provides the most succinct description yet of the current economic malaise: Helicopter drops might not be far away.

As described, the situation is the result of a two decade march to remove safety from our societies, asking individuals to take on the burden of their individual safety (an oxymoron) instead – this is what results in the savings glut.

But only when your world view is restricted to “growth at all costs” can you conclude that the improbable “must be the answer”.
The notion that we have to adjust our economies and societies to reach a sustainable state in the face of the physical constraints of our planet does not get a look-in.

The solution is not to dream up ways of making the unsustainable, and unnatural, work, but rather it is to seek out ways to return to a more sustainable economic and social structure (in which savings are more readily spent because they are not the embodiment of social safety).

The solution is universal social safety. That will free up spending, reduce investment costs (through lower labour rates), and increase risk appetite. It will also, incidentally, be an excellent use of the opportunity for public investment at current low rates and create a new lower cost basis for our economy going forward for the rest of the century.