今月初め、市場マネタリストとサイモン・レン−ルイスの「論争」のデロングによるまとめを紹介したが、その続きとでも言うべきエントリをデロングが書いている。そこではNick Roweレン−ルイスのブログ記事が紹介されており、エントリのタイトルは「Simon Wren-Lewis and Nick Rowe Annoy Each Other(サイモン・レン−ルイスとNick Roweはお互いに困惑している)」と題されている*1

It seems I need to respond to Paul Krugman.
"The neomonetarist movement starts from an acknowledgement of reality: shortfalls of aggregate demand do happen, and they do matter, and we need an answer. Like the original monetarists, however, they reject any government role in the form of discretionary fiscal policy. Instead, they argue that the Fed and its counterparts can do the job all on their own if they really want to."
OK. That's me. I'm a "neomonetarist" by that definition.
But there's absolutely nothing "neo" about that policy position. It's the neofiscalist position that is new.
What I call a "neofiscalist" is exactly the same as what Paul calls a "neomonetarist", except at the Zero Lower Bound. When the central bank hits the ZLB, neofiscalists throw up their hands in despair, and call for fiscal policy to manage aggregate demand.

Neomonetarism is a radical position. We want to get to the root of the problem of insufficient aggregate demand. We see aggregate demand as a monetary phenomenon, that only makes sense conceptually in a monetary exchange economy. And we see insufficient aggregate demand (just like an inflationary surfeit of aggregate demand) as due to an underlying failure of monetary institutions. We don't like fiscal patches that cover up that underlying problem. Because fiscal policy has other objectives and you can't always kill two birds with the same fiscal stone. Because we can't always rely on fiscal policymakers being able and willing to do the right thing. And because if your car has alternator trouble you fix the alternator; you don't just keep on doing bodge-jobs like replacing the battery every 100kms. And because if monetary policymakers do want to target too low a level of aggregate demand, then fiscal policy won't work, because the monetary policymakers will simply offset it.


I’ll come back to the car analogy, but let me focus on the patches idea for now. In their view, the proper way to do stabilisation policy outside a fixed exchange rate regime is, without qualification, to use monetary policy. So the first best policy is to try every monetary means possible, which may in fact turn out to be quite easy if only policymakers adopt the right rule. Fiscal policy is a second best bodge. MM just hates bodgers.
As I explained in this post, the situation is not symmetric. I do not get annoyed with MM because I think monetary policy is a bodge. I have spent much time discussing what monetary policy can do at the ZLB, and I have written favourably about nominal GDP targets. But, speaking for just myself, I do get annoyed by at least some advocates of MM.
To understand why I do get annoyed with MM, let me use another car analogy. We are going downhill, and the brakes do not seem to be working properly. I’m sitting in the backseat with a representative of MM. I suggest to the driver that they should keep trying the brake pedal, but they should also put the handbrake on. The person sitting next to me says “That is a terrible idea. The brake pedal should work. Maybe try pressing it in a different way. But do not put on the handbrake. The smell of burning rubber will be terrible. The brake pedal should work, that is what it is designed for, and to do anything else just lets the car manufacturer off the hook. Have you tried pressing on the accelerator after trying the brake?”
OK, that last one is unfair, but you get my point. When you have a macroeconomic disaster, with policymakers who are confused, conflicted and unreliable, you do not obsess over the optimal way of getting out of the disaster. There will be a time and place for that later. Instead you try and convince all the actors involved to do things that will avoid disaster. If both monetary and fiscal policymakers are doing the wrong thing given each other’s actions, and your influence on either will be minimal, you encourage both to change their ways.
MM agrees that fiscal stimulus will work unless it is actively counteracted by monetary policy. Nick says we can't always rely on fiscal policymakers being able and willing to do the right thing. But since at least 2011 we have not been able to rely on monetary policymakers in the Eurozone to do either the right thing, or consistently the wrong thing. So why is anyone with any sense saying that austerity is not a major factor behind the second Eurozone recession? That is just encouraging fiscal policymakers to carry on doing exactly the wrong thing, in the real world where monetary policy is set by the ECB rather than some MM devotee.
市場マネタリストは、金融政策によって積極的に打ち消されない限り財政刺激策が効くということには同意している。ニックは、財政政策の当局者が常に正しいことが実行でき、かつ、それを喜んですると当てにはできない、と言う。しかし、少なくとも2011年以降、ユーロ圏の金融政策担当者が正しいことをすることも常に間違ったことをすることも当てにはできなかった。そうするとなぜ、少しでも良識のある人が、ユーロ圏の第二の景気後退は財政緊縮策が主要な要因ではない、などと言うのか?*2 それは財政当局者に完全に間違ったことを続けるように促すだけである。現実世界では、市場マネタリストの信奉者ではなくECBによって金融政策が実施されているのだ。


...You are responding to Rowe who says aggregate demand can only fall short if there is money. You certainly seem to say that it requires money or some other financial instrument. This is not true.


...I don't (and Wren-Lewis certainly doesn't) agree with " The neo-fiscalist question in such a situation is 'why bother'? Why not just have the government borrow (through issuing either bonds or money) and spend?" We go for "Why not just have the government spend -- by borrowing if you aren't worried about national debt orby raising taxes if you are but raise spending about 1.5 to 2 times as much if you insist on raising taxes.






By the way, for some reason I never remember being annoyed at Simon Wren-Lewis, even when I disagree with him; but I do get very annoyed and frustrated when monetary policy does not do what I think it can do and is supposed to do.

*2:ここでレン−ルイスは、以前のエントリへのMark A. Sadowskiのコメントにリンクし、自分を困惑させている市場マネタリストの一人がSadowskiであることを示唆している。