Two bad arguments against a more relaxed attitude vis a vis fiscal policy: 1. Don't tell that to governments because they will misbehave. 2. And in any case, interest rates will increase soon.
. & believe the trade-off between debt consolidation and activity has dramatically changed, and that taking all the risks into consideration, it should tilt fiscal policy in a more expansionary direction. They address critics here
. and have recently developed arguments for a more relaxed attitude toward public debt and deficits. They address arguments that have arisen here
Blanchard & Ubide: Current US trajectory of deficits and debt is far from optimal. Because Fed has limited room to provide stimulus, primary deficits should be reduced, but slowly, and measures should be taken to reduce deficits in the long run. via
We should not pretend debt is catastrophic if it is not, write and , responding to critics of their recent arguments here
Lower interest rates decrease the fiscal and the economic costs of public debt and also limits policymakers' ability to use monetary policy. & make the case for the use of primary deficits to sustain demand where needed.
. & believe the trade-off between debt consolidation and activity has dramatically changed, and that taking all the risks into consideration, it should tilt fiscal policy in a more expansionary direction. They address critics here
Why Critics of a More Relaxed Attitude on Public Debt Are Wrong via