THE PAKISTAN DEVELOPMENT REVIEW
Paul Krugman. End This Depression Now! New York, USA: W. W. Norton & Company. 2012. 288 pages. U.S. $ 15.95
In “End This Depression Now!” Krugman has tackled the economic recession that has plagued countries across the globe in the aftermath of the 2008 financial crisis. In contrast to other books on the subject, however, the focus of the author is not on how the crisis and the resultant recession happened, but rather on the more pertinent question of what to do now and how to recover from the slump. Krugman is of the view that the aim should not be merely to avoid a complete collapse, as several economists and policy-makers seem content to do, but to address the “chronic condition of subnormal activity” of this recession and pursue a complete recovery. The author sets the stage by painting a bleak picture of the impact of the recession on the citizens of developed countries, countries rich in natural and human resources. There is a lack of jobs in these countries, as represented by a rising involuntary employment rate, and the author feels that lives have been ruined because the recession is lingering on, and because of that, unemployment is following suit. While temporary unemployment is a feature of a complex, dynamic economy, persistent unemployment erodes the employment prospects of workers in the post-recession period. Moreover, low business investment in the private sector and government investment in the public sector will have a detrimental effect on productive capacity in future years as older scrapped machinery is not replaced, and public sector programmes in education and health are scaled back.