Re:Does QE Cause Wealth Inequality?
by Ericson2314 on Tuesday November 16, 2021 @03:06PM
(#29245748)
The mainstream in the last 10 years is down with more fiscal spending in the form of investment, but that is still supply side. They are not down with "aggregate demand being structurally low, even between recessions".
Also the theory has not kept up. A lot of people spout decent ideas and do decent empiracle stuff, but the theory is not reformed and opposed to those conclusions so they just ignore it.
Really, the crazy Chicago people to their credit were always more honest about what the mainstream theory actually said. The saltwater people were rather two-faced in making sure they sounded less rediculous but not having an epicycle-free theory underpinning their more reasonable suggestions.
No, it didn’t.
Mainstream economic theory (or even the major heterodox theories) has never held that monetary policy is a sufficient substitute for fiscal policy in general, and mainstream economists in the US (of all stripes, though they differ on what fiscal policy should be) are always complaining about Congress not taking what they see to be appropriate fiscal action and leaving the economy to the Fed and monetary policy.