Steve Keen Steve Keen’s Oz Debtwatch
Mark Davis’s suggestion that wage restraint would reduce the rise in unemployment this year is nonsense (”Give your pay packet a shave and help save jobs“, January 2). Unemployment will rise in 2009 not because workers were paid too much in 2008 (or earlier), but because households and businesses took on too much debt during a speculative bubble that has now burst. In the aftermath, sane people attempt to reduce their debt but that means a reduction in spending, which causes unemployment to rise. Read more here