Saturday, 21 December 2013
Robert Skidelsky seems to be frightened of deficits.
Hot on the heals of the inane drivel coming from Summers and Krugman on the subject of secular stagnation, Skidelsky has now weighed in with the view that given a lack of investment opportunities and near zero population growth, there may be only source of the demand we need to bring full employment, namely “continuous fiscal deficits”.
As he puts it, “In this situation, full employment could be maintained only by running continuous fiscal deficits.” So what’s the problem with that, if Skidelsky is actually saying there is a problem there? And that’s not clear, but the suggestion seems to be that there’s a problem.
More clarity please, Prof. Skidelsky.