On 9/3/07, Doug Henwood <[EMAIL PROTECTED]> wrote: > Well, yeah. This is straight out of Kalecki, too: if the unemployment > rate gets too low, the balance of power will shift toward labor and > away from capital. The Fed (why the caps? it's not an acronym) can > think in clear class struggle terms, even if "progressive economists" > can't.
Is there any evidence that the Fed does think in class struggle terms? Bernanke is on record claiming that full employment and low inflation are complementary rather than tradeoffs. His reasoning is based on inflation expectation moderating the volatility of investment etc. Of course he prefers not to think about the possibility that inflation expectations may move *against* him. http://www.federalreserve.gov/boardDocs/Speeches/2006/200602242/default.htm -------------------------------------snip ....I will argue for what I believe has become the consensus view, that the mandated goals of price stability and maximum employment are almost entirely complementary. Central bankers, economists, and other knowledgeable observers around the world agree that price stability both contributes importantly to the economy's growth and employment prospects in the longer term and moderates the variability of output and employment in the short to medium term. -raghu.
