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Beware of Austerity Demands Once the Immediate Crisis Passes (The American Prospect, 5 min read) Cutting spending to address the rising deficit and debt concerns will fail. Taxes are the best way to reverse this. The failure to tax those at the top—not only due to the 2017 tax cuts but also due to decades of supply-side tax policies since the 1980s—has lowered federal revenue (as % of GDP) over time and contributed to income inequality.
Putting Swiss Public Debt to Good Use (VoxEU, 8 min read) Since the adoption of a debt brake rule in the late 1990s – Switzerland has taken less than optimal debt. More appealing options right now are moderate fiscal deficits (handle the challenges of health costs and aging population) and building sovereign wealth fund (deliver a source of revenue higher than the real yield on government debt).
5 Lessons from World War II for the Coronavirus Response (Vox, 12 min read) Most important lesson – policy should focus on relief now (as long as the crisis last) and stimulus later (till the economy rebounds). Centralizing government purchases of medical equipment, repurposing existing institutions availability of materials being constraint and crisis itself creates strong incentives for manufacturing firms to produce critical equipment are other lessons to learn.