Magazine article The International Economy

Remembering Michael Mussa

Magazine article The International Economy

Remembering Michael Mussa

Article excerpt

Michael Mussa, who died January 15 after a long struggle with heart disease, left an indelible legacy at the Peterson Institute for International Economics and in the world of economics at large. Before joining the Institute in 2001 as a senior fellow in charge of our biannual forecasts, Mike was a legend at the International Monetary Fund, where he was chief economist for nearly a decade. At the Institute he was deeply engaged in all our activities for a decade and never failed to improve, and even inspire, our internal debates and written products.

Mike was a very popular and persuasive participant in our seminars and briefings, where he could be counted on for lucid analysis and pungent humor. "My favorite economic policy tool is prayer," he once said. "It is not demonstrably less effective than the others and it carries none of the bad side effects." In an essay on trade for the American Economic Review in 1993, he memorably wrote: "In Washington, the truth is just another special interest, and one that is not particularly well-financed."

Mike was probably best known to the outside world in recent years for his semi-annual global economic forecasts. In 2009, he challenged those who said there would be little or no recovery from the recession, and lately asserted he had been proven right even though the recovery has been disappointing largely because the housing sector remains weak. More recently, he expressed doubts about the efficacy of sizeable further economic and fiscal stimulus for the U.S. economy.

Mike was often scathing in his criticism of what he considered to be public policy failures in regulating financial institutions, responding to recessions, or rescuing troubled countries. As Mervyn King, governor of the Bank of England, noted, Mike "forced the international community to face up to the realities" of the Latin American debt crises of the late 1990s. …

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