Most governments try to maintain low inflation rates and low unemployment rates. These objectives are often seen as necessary for social and political stability. Reaching these economic goals requires attention to monetary and fiscal policies which, in turn, can constrain how many of the policy goals above a country can realistically expect to achieve.
The monetary and fiscal trade-offs force us all to confront a question: who gets to decide which policies to pursue and at what cost to the population? Dictators? All of us? Elected representatives, accountable to voters? See our short course on America: Republic or Democracy.
Excerpted from What Should Governments Do for Us?
Image: Congressional Budget Office, May 2, 2019.