Inefficient Redistribution Policies Researchers point out that governments use trade policies to redistribute income even though it is less efficient than using taxes because those invested in the protectionism are more likely to sustain it despite changes in political regimes. The pandemic has reinvigorated direct income transfers to individuals in the U.S. but by utilizing borrowed money. In essence, it is the affluent that are more burdened by the future debt and the crisis prevents them from objecting. However, this adds to the cost of borrowing and since there are practical limits to debt, it is also unsustainable. Meanwhile, European Central Bank Governing Council member Klaas Knot says the interest rate could be cut again to stop th...

TAGS – Europe, North America