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Independent Student Newspaper Since 1969

The Badger Herald

Independent Student Newspaper Since 1969

The Badger Herald

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UW professor debuts book on current state of economy

A recently published book by a University of Wisconsin economics professor highlights the reasons behind the country’s recent economic downturn and what U.S. citizens can do to improve the current economic climate.

Menzie Chinn’s “Lost Decades: The Making of America’s Debt Crisis and the Long Recovery” was released Monday. The book chronicles the lead-up to the financial market crash and subsequent bailout in 2008 before looking forward to what people should do in the wake of a stagnant economic period.

Chinn co-wrote the book with Harvard government professor Jeffry Frieden, and between the two professors lies more than 50 years of experience studying economic fluctuations in Europe, South America and Asia.

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La Follette School of Public Affairs Director and economist Thomas DeLeire said the book would be an important read as very few people fully understand what happened with the economy.

“The financial crisis that preceded the recession caught most economists by complete surprise,” DeLeire said. “So to understand what happened there is crucial.”

Publisher’s Weekly concurred with DeLeire’s assessment, stating the publication was an “important book, which deserves to be widely read and debated.”

Chinn said while he first met Frieden during a seminar at the University of California-Santa Cruz, the two professors did not begin talking seriously until the outbreak of the financial crisis.

They then began to exchange emails, seeking to fully understand the situation, he said.

Chinn said the two decided to compile their electronic conversations into a book after a year and a half of correspondence, realizing there was no other place to find a comprehensive treatment covering both economics and politics.

“To our knowledge, no other treatment has taken a similarly cross-country and historical perspective,” he said.

The book, which reads like a novel, is also an analytical study. Narratives are interspersed throughout, detailing the situation facing Washington, D.C. policymakers. Underneath it all, however, is the conclusion drawn from Chinn and Frieden.

“In our view … policy decisions led to an unsustainable housing and financial boom that has not dissipated, leaving the government saddled with enormous debts,” Chinn said.

Before coming to UW in 2003, Chinn was the senior economist for international finance for the President’s Council of Economic Advisers during the last year of the Clinton administration.

DeLeire said this background was not only beneficial to UW but possibly another reason Chinn decided to publish the book.

“Menzie has been in the public eye for most of his career,” DeLeire said. “So this book is not much of a surprise coming from him, but we are very excited and proud to have him as a faculty member.”

Ultimately, Chinn hopes readers will gain insight from reading his book as well as an appreciation of the fact that similar crises have occurred in the past.

“We can’t rely upon the free market to regulate itself. Rather we need [the] government to step in when excesses in borrowing and lending develop. And the public needs to [be vigilant and] watch the government when it fails, as it did in the years leading up to 2008,” he said.

In the original article, “Lost Decades: The Making of America’s Debt Crisis and the Long Recovery” was referred to as a “novel,” and it should not have been referred to the publication as a work of fiction. The article has been changed to refer to Menzie Chinn’s publication as a “book.” We regret the error.

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