Get Cracking on the Deficit

We have highlighted earlier that after the credit crisis,two adverse trends have emerged: a sharp decline in private investment and a major rise in fiscal deficit.In other words,as the productive driver to sustainable growth suffered,the government has relied more and more on the less productive driver of higher fiscal deficit.We have argued that there is a need for a campaign-style effort from the government to revive investment in a counter-cyclical manner soon.

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