Larger deficits are necessary and proper means to mitigate unemployment as the far greater evil in terms of human welfare.

The 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.

I define genuine full employment as a situation where there are at least as many job openings as there are persons seeking employment, probably calling for a rate of unemployment, as currently measured, of between 1 and 2 percent.

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.

Currently a level of unemployment of 7% or more seems to be required to keep inflation from accelerating, a level quite unacceptable as a permanent situation.

Practically, the desirable situation ought to be one in which any reasonably responsible person willing to accept available employment can find a job paying a living wage within 48 hours.

Larger deficits are necessary and proper means to mitigate unemployment as the far greater evil in terms of human welfare.