The Shape Of The Recovery

Posner is blogging again:

I had thought when I agreed with my publisher on a deadline for the new book that by the end of 2009 the shape of recovery would be clear. It is not. We simply cannot responsibly gauge the pace of the recovery. Nor is it even clear whether we are better off with a fast recovery or a slow one. A fast recovery could create an acute risk of dangerously high inflation. A slow recovery could greatly increase the size of the federal deficit, threatening all sorts of economic and political harms, with eventual unacceptable inflation only one of them. I am particularly concerned with the danger of social and political turmoil if high unemployment and related economic pathologies persist.