Larry Summers, Former Secretary of the Treasury for the Clinton Administration and Former Director, National Economic Council for the Obama White House has put forth the economic concept known as “secular stagnation” as a significant factor in the current poor performance in the U.S. economy. (See article - On secular stagnation: Larry Summers responds to Ben Bernanke)
Secular stagnation is defined as an economic situation created when there is a chronic excess of saving over investment. The economic prescription proposed when this situation occurs is to expand fiscal policy in general and public investment in particular to promote growth. Is the chronic saving situation real or is it just a consequence of prior political actions which now need to be corrected? And if so, how did the U.S. and the world get into this predicament?