Catherine Rampbell points us to an EPI report combating the arguments that our high unemployment is structural in nature. Rampbell notes
A few economists have been vigorously arguing against claims of structural unemployment, which they fear are being used merely to weaken the case for additional stimulus (which is generally intended to address more temporary, cyclical issues).
I don’t doubt that there are economists out there who are arguing against the structural hypothesis because they support more stimulus. I am not one of them. If you want to search this blog you can read some of my old takes on stimulus. However, I am not particularly interested in even having that debate.
You don’t like stimulus. Fine. I don’t care why. I am not interested in why.
I am interested in whether or not you support efforts to raise the level of inflation in the United States. Economists of all political stripes have long noted what former George W. Bush Advisor Greg Mankiw has called “The Inexorable And Mysterious Tradeoff Between Inflation And Unemployment”
Let me offer two quotes from David Hume. The first to prove that he was no wide-eyed progressive.
I must, therefore, be of opinion, that [taking away power from the King and Nobility] would introduce a total alteration in our government, and would soon reduce it to a pure republic; and, perhaps, to a republic of no inconvenient form. . . . Let us cherish and improve our ancient government as much as possible, without encouraging a passion for such dangerous novelties.
The second to show Hume could observe the relationship between money and employment
In my opinion, it is only in the interval or intermediate situation, between the acquisition of money and the rise in prices, that the increasing quantity of gold or silver is favourable to industry. . . . The farmer or gardener, finding that their commodities are taken off, apply themselves with alacrity to the raising of more. . . . It is easy to trace the money in its progress through the whole commonwealth; where we shall find that it must first quicken the diligence of every individual, before it increases the price of labour.
Determining whether or not the millions of unemployed Americans are without jobs for structural or cyclical reasons is not a partisan issue. It is not cudgel with which to beat up the other side. This is a question of whether or not we are going to exploit a long established trade-off to end the suffering of millions of our countrymen or whether like the Bank of Japan we are going twiddle our thumbs while our economy lies in ruin.