A recent post of Paul Krugman points out to a “worrisome campaign against full employment”:
The leader of this movement is an economics student named Evan Soltas, although Krugman doesn’t name him, maybe because Soltas is just a student.
If you go over to Soltas’ blog, you will find the vaguest interpretations of data claiming the labour market has become “tight” and that “it’s about time” the Federal Reserve raises interest rates. One of his replies to Dean Baker also brings in some vague statement about the Federal funds futures markets!
I won’t go into an analysis of how completely vague Soltas’ campaign is because Krugman has already done a nice analysis. But in case you weren’t following, let me also point out his Bloomberg article where he tells a story of how labour unions have died in the United States, making it look like such a thing was natural. This is poor rewriting of history because via policy, power has been slowly sucked out of unions.
Soltas also features in Mankiw’s latest book, where Mankiw quotes his argument that there is something wrong about universities having a differential fee structure.
Back to labour market versus policy. Such strong claims disadvantage the opponents who are trying to convince policy makers to expand fiscal policy. It makes a good strategy: shift the debate into something else – monetary policy in this case – and divert attention from fiscal policy even more.
Evan Soltas will be the future Greg Mankiw.