There is so much to say about this…ahem, “reasoned analysis,” that I think I’ll turn it over to you. How would you critique this article? Try to limit your response to no more than 3 things. I will add to your comments but then provide a subsequent edited update to summarize my thoughts in a few days.

Edit Update:

So lots of ways to look at this article, but Daniel hits the #1 issue: this is just a broken window fallacy right from the beginning. The headline says this clearly:

Millions of new jobs could be created if governments spend more, IMF says

So where, oh where, is the government going to get this money? If they tax it, that just reduces equivalent private demand for labor. Is there any reason to believe that government demand is somehow much more efficient than private spending? I think just the opposite–there is a reason why we have the expression “government boondoggle.” This just follows Milton Friedman’s common sense observation that we are always more careful spending our own money than when we spend someone else’s. But what if we just borrow the money? That’s where the article get’s more schizophrenic, as it argues that part of the problem is the soaring debt levels of governments. So how again does borrowing to spend more money help with soaring debt levels? And of course, even if the soaring debt levels were not a problem, borrowing from the private sector is still a broken window, since the private sector would have used that money for something, and deletion of that private demand will result in lower employment in the industries that private spending would have supported, in favor of industries the government supports.

As always, government do not “create” more jobs, they simply can affect the distribution of the types of jobs that are created. And this means that we will have more of our economy directed politically rather than privately. And this is, not surprisingly, something the IMF is fully on board with.