Fiscal stimulus in response to the COVID shock filled a 'hole' in aggregate income, which prevented hysteresis (permanent loss of productive capacity). Overfilling the hole slightly (creating 1-2% extra inflation per year) was worth the cost of preventing permanent supply-side damage.
causalpending
Speaker
Mark DaEvidence Quote
“fiscal policy is designed to fill that hole”
Created: 8/11/2026, 1:22:08 AM
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