I very much enjoyed Josh Barro’s analysis of SOTU 2012. Josh is an advocate of large-scale mortgage modification and NGDP targeting as instruments for accelerating the economic recovery. Though I was once enthusiastic about the former, I’m now much less so, in part because of the administrative challenges and the potential implications for vulnerable financial institutions. (No, I don’t care about vulnerable financial institutions as such. Rather, I think timing is important.) And though I’ve been favorably inclined towards the arguments for NGDP targeting, Ashwin Parameswaran has given us reason to be skeptical. I’d much rather Josh were right about mortgage modification and NGDP targeting, as they’re both levers we can imagine a Democratic or Republican president pulling under the right circumstance, but I’m just not sure they’ll work as intended.