The Long and Short of It

I don't remember where I found this PDF --

The Rise and Fall of a Policy Rule: Monetarism at the St. Louis Fed, 1968-1986
R.W. Hafer and David C. Wheelock

(Across the top of the page it says FEDERAL RESERVE BANK OF ST. LOUIS, and on the opposite page REVIEW, and at the bottom it says JANUARY/FEBRUARY 2001.)

But anyway, here is the first part of the opening paragraph:
Macroeconomists today generally agree that monetary policy cannot permanently increase the rate of economic growth above its potential or decrease the rate of unemployment below its market clearing, or “natural,” level.


While the phrase policy cannot permanently increase the rate of economic growth above its potential, nor decrease the rate of unemployment below its “natural” level is yet between my ears, my mind is picturing the Dark Age.

There was a time, no doubt, when it was too late to prevent the fall of Rome. But there was a time before that, when the right economic policy might have prevented the fall.

Economists claim that policy is ineffective and that the economy has its own "natural" levels. What they are really saying is they don't know how to make effective policy.