{
  "title": "Book Reviews: Unwelcome Return",
  "sourceUrl": "https://www.imf.org/en/publications/fandd/issues/2023/06/book-unwelcome-return-max-harris",
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  "summary": "Alas, the 1970s seem freshly relevant. Energy supplies are once more in doubt. The international order is yet again straining at the seams. Even the music is making a comeback.",
  "sections": [
    {
      "heading": "Overview and thesis",
      "content": "- Author of the reviewed book: economist Stephen D. King.\n- Central contention: current inflation is not primarily the product of a few shocks—pandemic-induced supply chain snarls or Russia’s invasion of Ukraine—but rather systemic problems in economic policy in recent years.\n- Key policy mechanisms King criticizes:\n  - Central banks adopted frameworks that bias them toward inflation.\n  - Quantitative easing became “totally addictive.”\n  - Policymakers believed “their own anti-inflation credibility more or less guaranteed that inflation expectations would remain well behaved.”\n  - Central banks are far less independent than they appear and are subject to pressure to do the bidding of fiscal authorities."
    },
    {
      "heading": "Historical context and examples",
      "content": "- Inflation’s historical recurrence emphasized with examples including:\n  - French assignats\n  - US greenbacks during the Civil War\n  - Weimar’s hyperinflation\n  - Roman coinage and medieval debasement\n  - The 1970s (noted repeatedly as freshly relevant)\n  - Very recent history: Britain’s mini-budget crisis\n- Cultural reference: Earnest Jackson’s 1975 funk song “Inflation” cited as resonant with today’s conditions."
    },
    {
      "heading": "Strengths and limitations of King’s account",
      "content": "- Strengths:\n  - Makes the case with verve and vivid historical snapshots.\n  - Underscores the pernicious effects of inflation and the absurdity of thinking it could never reappear in advanced economies.\n  - Affirms that “inflation must be tackled, head-on and without hesitation.”\n- Limitations and contestable points:\n  - Argument may lack empathy for real-time policymaking challenges during a once-in-a-century pandemic.\n  - Some forward-looking recommendations lack specificity:\n    - Which “rules-based” policy framework does King favor?\n    - What precisely is meant by calling for “monetary dominance” over fiscal policy?\n  - Readers seeking a systematic treatment of inflation over the past two millennia will need to look elsewhere."
    },
    {
      "heading": "Policy implications and takeaways",
      "content": "- General policy positions presented or endorsed in the review of King’s book:\n  - Price and wage controls are rejected: they are “bad in theory and worse in practice.”\n  - Immediate and vigorous action to combat inflation is necessary.\n  - Awareness that inflation has massive distributional consequences that can be unfair and undemocratic.\n- Forward vigilance:\n  - The most important lesson: monetary history matters.\n  - Central bankers have “gotten the message,” raising rates at a rapid clip.\n  - Simultaneous vigilance against deflation is necessary: history is replete with examples of the pain caused by declining prices, and policymakers should avoid forgetting those perils."
    },
    {
      "heading": "Metadata and authorship noted on the page",
      "content": "- F&D Magazine\n- Unwelcome Return\n- MAX HARRIS\n- June 2023\n- MAX HARRIS is senior fellow at the Wharton Initiative on Financial Policy and Regulation.\n- Disclaimer: “Opinions expressed in articles and other materials are those of the authors; they do not necessarily reflect IMF policy.”\n\nF&D Magazine — Unwelcome Return — MAX HARRIS — June 2023\n\n---\n\n Content in this bundle\n\n- Unwelcome Return\n  - Unwelcome Return (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Unwelcome Return (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/fandd/issues/2023/06/book-unwelcome-return-max-harris"
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    "Authors: MAX HARRIS",
    "Published: June 1, 2023",
    "Author of the reviewed book: economist Stephen D. King.",
    "Central contention: current inflation is not primarily the product of a few shocks—pandemic-induced supply chain snarls or Russia’s invasion of Ukraine—but rather systemic problems in economic policy in recent years.",
    "Key policy mechanisms King criticizes:",
    "Inflation’s historical recurrence emphasized with examples including:",
    "Cultural reference: Earnest Jackson’s 1975 funk song “Inflation” cited as resonant with today’s conditions.",
    "Strengths:",
    "Limitations and contestable points:",
    "General policy positions presented or endorsed in the review of King’s book:",
    "Forward vigilance:",
    "F&D Magazine",
    "Unwelcome Return",
    "MAX HARRIS",
    "June 2023",
    "MAX HARRIS is senior fellow at the Wharton Initiative on Financial Policy and Regulation.",
    "Disclaimer: “Opinions expressed in articles and other materials are those of the authors; they do not necessarily reflect IMF policy.”",
    "**Unwelcome Return**"
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