Krugman argues against changing the Fed's mandate to focus on price stability only, instead of price stability and employment.
No mention of effective demand or fiscal policy.
Read it at The New York Times | The Conscience of a Liberal
Unemployment and Inflation
by Paul Krugman
Favorite line: "Some people have pointed to the failure of inflation to fall by a lot as evidence that the NAIRU — the non-accelerating-inflation rate of unemployment — has risen sharply, so that America is now at more or less full employment."
In the face of that, I guess Krugman is not so bad. At least he is not willing to go there.