Wolfers on country music and the Fed’s dual mandate
“The struggle to balance the demands of keeping unemployment low versus keeping a lid on inflation is just the sort of dilemma crying out for the full country-music treatment,” states Justin Wolfers in Simone Pathe’s recent article, “From Alan Greenspan to Justin Wolfers, Economists Consider the Fed’s ‘Dual Mandate’” posted on PBS Newshour on November 6. Wolfers and several other prominent economists and former Fed officials discuss the challenges faced by the Fed in the context of Merle Hazard’s latest song.
Merle Hazard, a country recording artist who writes songs about a variety of fiscal and economic issues, recently released Dual Mandate. With the release of October’s unemployment data, Wolfers agreed with the story Hazard’s lyrics tell. “The battle between workers scared about losing their jobs and rentiers demanding the nominal value of their wealth remain unchanged…I had always thought this struggle central to understanding modern central banking,”
Now more than ever, Justin Wolfers says, is a time when the two sides, “can agree that the Fed needs to do more to stimulate the economy.” Wolfers hopes that Hazard will follow up Dual Mandate with a ballad encouraging the Fed to live up to its mandate.
Justin Wolfers is a professor of public policy and economics at the University of Michigan and a senior fellow with the Peterson Institute for International Economics.