“As is often the case with major disputes in economics, the argument over fiscal policy went on for years, with some critics of fiscal policy still defending their position when this book went to press. It seems fair, however, to say that among economists a more or less Keynesian view of the effects of fiscal policy came to prevail. Careful statistical studies at the International Monetary Fund and else where showed that austerity policies have historically been followed by contraction, not expansion. Recent experience, in which countries like Spain and Greece that were forced into severe austerity also experienced severe slumps, seemed to confirm that observation. Furthermore, it was clear that those who had predicted a sharp rise in U. S. interest rates due to budget deficits, leading to conventional crowding out, had been wrong: U. S. long-term interest rates remained near record lows even during the years from 2009 to 2012, when the government ran very large deficits.”

— Paul Krugman

Source: Economics (4th ed., 2015), Chapter 33. Macroeconomics: Events and Ideas

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American economist 1953

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“Balancing fiscal and monetary policies is a problem. If you do just one thing, it is not necessarily enough—neither monetary policy alone nor fiscal policy alone, and neither tax cuts nor expenditure increases alone. You need to mix policy. By having the right balance, you can get high employment and stable prices.”

Lawrence Klein (1920–2013) American economist

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“I refuse to start from the assumption that the role of monetary policy is to control and stabilize inflation. The only acceptable way to start is, I believe, to think of the goal of monetary policy, together with fiscal policy,as the maximization of welfare.”

Olivier Blanchard (1948) French economist

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“The central message is still that, as Keynes argued, fiscal policy is the answer to liquidity traps, financial or political. The arguments against fiscal policy in Japan, so far as I understand them are intellectually fallacious; they would receive failing grades in an undergraduate macro exam.”

James Tobin (1918–2002) American economist

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“Economic and monetary union…is incompatible with independent sovereign states with control over their own fiscal and monetary policies. It would be impossible…to have irrevocably fixed exchange rates while individual countries retained independent monetary policies…such a system could never have the credibility necessary to persuade the market that there was no risk of realignment. Thus EMU inevitably implies a single European currency, with monetary decisions…taken not by national Governments and/or central banks, but by a European Central Bank. Nor would individual countries be able to retain responsibility for fiscal policy. With a single European monetary policy there would need to be central control over the size of budget deficits and, particularly, over their financing. New European institutions would be required, to determine overall Community fiscal policy and agree the distribution of deficits between individual Member States…It is clear that Economic and Monetary Union implies nothing less than European Government…and political union: the United States of Europe. That is simply not on the agenda now, nor will it be for the forseeable future.”

Nigel Lawson (1932) British Conservative politician and journalist

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“Keynes's idea was very simple. Monetary and fiscal policy should have a single goal, jointly pursued, of maintaining a full employment level aggregate demand.”

Robert Skidelsky (1939) Economist and author

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“The economic policy issues that we debate today—trade policy, inflation, the proper role of government, the eradication of poverty, and the means of raising the rate of economic growth—have been discussed by economists for more than two centuries. Many of today’s economic policies—both the good ones and the bad—are the result of the ideas of those past economists. And many of today’s debates about economic policy can be understood only by those who have at least some familiarity with the ideas of earlier economists.
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Martin Feldstein (1939–2019) American economist

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“For policy, the central fact is that Keynesian policy recommendations have no sounder basis, in a scientific sense, than recommendations of non-Keynesian economists or, for that matter, non-economists.”

Thomas J. Sargent (1943) American economist

Robert Lucas, Jr. and Thomas J. Sargent, "After Keynesian macroeconomics", After the Phillips Curve: Persistence of High Inflation and High Unemployment (1978).

Robert Lucas Jr. (1937) American economist

"After Keynesian macroeconomics" 1978

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