Priority No. 1: Creating An Agenda To Spur Job-Creating Economic Growth

Events in the United States are confirming what scholars have concluded: economic downturns driven by financial crises differ fundamentally from classic cyclical recessions. Because a massive amount of wealth is destroyed and the normal flow of credit is disrupted, production shrinks sharply, demand recovers slowly as consumers and businesses shed debt, and job losses are large, pervasive, and long-lasting. To begin, the growth model on which they have relied since the 1980s has hit a wall. In recent decades, household debt soared to unsustainable levels, household savings plunged to near zero, and personal consumption rose to unprecedented levels as a share of GDP.