Gone are the days when debates over the role (if at all) of the government vis-à-vis the economy centered on whether markets need big or small government intervention. With the whiplash of global economic crisis expected to hit badly by 2009, arguing if there’s a necessity—nay, urgency— for government interventions is simply not advisable. Economists of different persuasions believe that governments should. Why? Because as those who have gone through Economics 101 (Principles of Economics) with the assistance of Prof. Gregory Mankiw’s textbook know, Principle No.7 says that “The government can sometimes improve market outcomes.”
Now isn’t the time to cry over spilled milk either. Rather, it’s time to think of ways how we can get out of this—alive and kicking. Prof. Cielito Habito, for instance, argued that there is a way out of crisis if only the government acts smartly.
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