Economic growth: "New normal" is just normal
Investors, analysts and economic policy makers from the U.S., Europe and Japan are fixated on the slow rate of economic expansion since the end of the global recession seven years ago. For most other citizens, the key question is when will their wages (earning power) increase? Is slow growth the "new normal," or can the developed economies return to a period of 3-5% GDP growth and increasing earning power in the future?
Writing in the Wall Street Journal, author and former Economist editor Marc Levinson suggests that we are looking at the issue from the wrong perspective...or rather, that our perspective has been shaped by an extraordinary period in history (the years between 1948-1973) when growth was unusually high because post WWII measures such as universal education and urbanization resulted in abnormally high productivity increases.
"The extraordinary experience of the Golden Age left us with the unfortunate legacy of unrealistic expectations about our governments’ ability to deliver jobs, pay raises and steady growth."
If we expand our frame of reference to include a broader slice of history, the current pace of growth is "ordinary." What are your thoughts on how the pace of growth is perceived, and its potential impact on mutuality?
-- Clara Shen