Expanding state

Expanding state
A trend toward increased government influence in economies and personal life is curbing growth, and freedom, in many Western countries. The outsized role of government results in misplaced incentives, overregulation – which restrains markets and competition – and irresponsible budgetary policies. It leads to planned economies and principalist, authoritarian, centralist and also socialist policies. As history shows, such governments inevitably fail in the end.

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Christine Lagarde, the incumbent managing director and chair of the International Monetary Fund (IMF), former French economy minister, soon to head the ECB

GIS Dossier: Monetary policy stood on its head

Unconventional monetary policies saved many financial institutions in the U.S. and Europe after the financial crisis. However, near-zero to negative interest rates and central banks’ massive debt-purchasing programs, which pumped trillions of dollars and euros into economies, failed to restore growth and have had potent, negative and lasting side-effects. Relaxing the corset of regulations while restoring the market players’ responsibility would have worked better.  

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