The supply-side effect of a restrictive monetary policy, moreover, is likely to be perverse. High interest rates enter into costs and thus exert inflationary pressure, as well as inhibiting the expansion of capacity or the introduction of cost -reducing capital improvements.
William VickreyThere is no real justification for a requirement that a budget of any sort should be balanced, except as a rallying point for those who seek to hamstring government.
William VickreyThe great increase in longevity has produced a surge in the desire to accumulate assets for retirement. It has outpaced the ability of the private sector to produce assets, so we need a larger government debt.
William VickreyFirms would be given initial entitlements to gross markup on the basis of past performance, adjusted by changes in labor and capital inputs. This is somewhat similar to the definition of normal profits under some versions of the wartime excess -profits tax. Entitlements would be transferable and a competitive market established.
William Vickrey