On the Brink of Fatal Policy Error
The more I think of it, especially after the passage of the One Big Beautiful Bill, it seems more clear that we could be on a path much like in the 60s and 70s. In fact, there are a lot of parallels, not a perfect match, but striking:
Fiscal Policy:
Then:
LBJ’s Great Society + Vietnam → soaring government spending and persistent deficits.
Now:
Post-COVI
Richard Excell • Inflation?
Criticism
American economist Thomas Palley has said MMT's appeal lies in it being a “policy polemic for depressed times.”
10
He has criticized the suggestion that central bank interest rates be maintained at zero, and said MMT does not account for political complications arising from vested interests.
Nobel Prize-winning economist Paul Krugman has... See more
American economist Thomas Palley has said MMT's appeal lies in it being a “policy polemic for depressed times.”
10
He has criticized the suggestion that central bank interest rates be maintained at zero, and said MMT does not account for political complications arising from vested interests.
Nobel Prize-winning economist Paul Krugman has... See more
A central reason for policy intervention in this boom-bust process, Minsky emphasized, is the ever-present danger that the contraction will get out of control and spread into a system-wide debt-deflation. In this way, a normal business recession can become instead a deep and long-lasting depression, such as happened in 1929-1933 when debt deflation
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