The most extraordinary thing about the U.S. economy is how ordinary it appears. Despite years of unprecedented policies, the old economic relationships have reasserted themselves with bold familiarity. This is most obvious with the so-called inflation-unemployment trade-off. In short, the trade-off doesn’t exist, and it never did.
Economists once thought they could get unemployed workers on payrolls by ginning up the demand side of the economy. Unleash some easy money on the market, and workers would be fooled by the “money illusion” into accepting jobs at nominal wages that, had they known about impending inflation, they would have rejected as too low. Stagflation during the 1970s and early ʼ80s taught us this is far too simplistic. Workers don’t naively ignore economy-wide changes, including policy-induced changes, when deciding whether or how much to work. Expectations matter. The correct model of economic policy isn’t fine-tuning an inflation-unemployment trade-off but making fiscal and monetary conditions predictable so workers and businesses can strike the best deals possible.
Ben Zycher writes about how a deal on permitting reform could still be possible:
Nevertheless, because the opponents of fossil fuels are desperate for an “energy transition” to wind and solar energy in particular, a potential deal on permitting reform on these sorts of lines still (sooner or later) ought to be possible because state and local opposition to wind and solar projects is growing rapidly. Robert Bryce reports at least 375 such rejections since 2015.
This means that permitting reform next year might appeal to both sides for almost diametrically opposed reasons. This is the case for Republicans because of the possible easing of restrictions on fossil fuel projects, and also because — let’s be honest — there are several Republican senators from wind states. For opponents of fossil fuels, permitting reform might ease the path for wind and solar projects, and such reform might be necessary for the vast expansion of the transmission system needed to make unconventional power feasible even in theory.