The Mix, the Budget and the National Debt

Abstract

There are a number of aspects of policy relating to the budget that have a bearing on the proper use of the available macroeconomic policy instruments to stop stagflation. They include the question of how far the changes in the real level of the national debt may have implications for the appropriate combination of macroeconomic measures; and the relationship between the level of government spending that is thought appropriate for political or other reasons and the macroeconomic policy that should be followed. A more enlightened approach to these issues in general public discussion is essential if there is to be sufficient public understanding of the basic issues to ensure that the political obstacles to the adoption of appropriate policies are overcome.