Yes the news is getting better across the board, and it does seem that recovery is finally on its way. What's more the zero bound is "yesterday's news" and so while my recent post on plastics of course still applies...obviously the title wasn't good! Says Scott Sumner, "So let's PLEASE stop talking about the zero bound." Looks like any discussions of "blastoff" need to be defined in somewhat different terms, and admittedly I'm not quite sure how to distinguish my own suggestions from the monetary policies I support (note to self: work on that!).
At the very least - unlike some MMTers out there (wow, even Mark Thoma thinks their ideas are nuts!), I have a feeling that more of what happens now needs to come from Main Street - not Washington - when it comes to finding better means for economic access. That's true even though there would definitely be times when local efforts need Washington's "okays" for proposals and economic reforms. Yes, everyone needs to gain work, but not on the bottomless pit terms that some still think are government's ability to print money.
Even though my focus is unchanged as to the economic long term, I am definitely glad for the growth that has occurred. There is less need now for increasing employment in Market Monetarist terms, as the primary goal is to change central bank policy and create a target: one that the public and the marketplace have reason to believe they can rely on. Right now, without NGDPLT in place, there is still the issue of a somewhat unfocused growth, that makes it hard to know whether the Fed - or any other central bank for that matter - will still get things wrong, just when it seems they may be getting things right.
What about the continued limitations of today's employment situation? All along, the Fed has indicated that it cannot do everything that needs to be done in this regard, and that explanation certainly applies for Market Monetarists, as well. Indeed, the more recent positive numbers will also serve to clear up some confusion, as to what Market Monetarists actually support in this regard. In the past year there have been questions as to whether - should an NGDP target be adopted - the stated target would only get renegotiated continuously, much as the Fed continues to muddle through its present strategies. However, an agreed upon level is the best option to create monetary stability. In other words, a target which remains level should be able to prevent unnecessary losses in the first place: losses that are never easy to recoup when central bankers freeze and unexpectedly renege on what had been a steady path of growth management, for a long duration.
If this does not seem like an adequate definition of economic stability to some...perhaps only because such discussions still do not happen in the kinds of environments where understandable coordination is actually taking place. Who envisions growth, and how do they perceive it as being possible? Do such visions run counter to the visions of others, and if so, why? While nations have been able to discuss these important economic issues to a degree amongst one another, no real counterpart of such negotiations exists within a nation itself for internal discussions. Instead, various interests are pitted against one another in Washington, and the interests of those who vote are also at variance with what happens for the economic actors, and the producers and consumers who are affected by what actually takes place.
Many discussions for instance today that revolve around dynamic change for community, have little in the way of larger coordination options that could assist such efforts, let alone start anew in the pursuit of a stronger, more inclusive economic vision. When people know that certain things are not possible to accomplish, that means other things therefore need to be take place. Too often, Washington only indicates what cannot be done, or tries to do what is in fact impossible, and then that is far as the process goes.
By now, most of my readers know that I envision growth as possible in supply side structural terms, but not generally in terms of government taxation. By supply side structural, I refer to the freeing of all product to be pursued in both competitive and comparative settings, and wherever it is possible, by the individuals who desire to take on the economic activity itself. Institutions have attempted to isolate some of our most valuable knowledge, by forcing it into arbitrary containers. As a result, the thought processes knowledge represents are scarcely able to be used for their intended purposes - either in interdisciplinary circumstance where knowledge is most needed, or at aggregate levels of society.
Just as important, growth needs to happen both incrementally and internally in ways not necessarily measured as increased monetary quantity. That really matters for nominal targeting, in that the inclusion of those who would utilize wealth from the same cooperative hourly base is not the same imposition as wage definition in many professions. For instance, societal adjustments which could create a new form of middle class, do not have to show up as outsized additions to GDP. What matters for the unemployed of the present is that they find inclusion not through subsidies, but through true economic integration and strategically focused reform. The time has come to make that happen.
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