Interest Rates

Adding their voices to Kash’s view that interest rates should not be changed are Supply Side advocate Jude Wanninski and Keynesian Economist James Galbraith in a joint Op/Ed in the Sunday Washington Times:

One of us is the First Supply Sider. The other is the Last Keynesian. One is Republican; the other Democrat. One helped invent Reaganomics; the other spent four years trying to stop it. Yet we agree on one thing. Alan Greenspan should not raise interest rates now or in the near future.

…And while growth has returned, the economy remains far from full employment. We have enjoyed just a few decent months of job creation. A million jobs in three months is good news. But we remain about 1.3 million jobs below the actual level of payroll employment four years ago. We’re still about 5 million jobs short of what we should have, given population and labor force growth since then.

I’m not an expert in Macroeconomics, but I’d like to see us at least break even on jobs relative to where we were when Bush took office before the Fed starts tightening the screws. I suppose the silver lining of a rate hike is that it might hurt Bush. But I prefer my monetary policy rooted in economics, not politics.