Oh, my. Even Matt Yglesias doesn’t quite get it.
Writing about Republican plans to raise employment by reducing it, he writes
"America is just too big to adjust primarily through the currency channel. So one possible route is nominal deflation. You cut nominal public sector salaries, lay off public sector workers, and reduce nominal transfer payments (Security Security, SNAP, etc.). This ought to drive down wages in the private sector, too, and eventually everyone is making sufficiently little money that it makes sense to start hiring more people."
Krugman' editorial is regarding this article:
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