A lot has happened since I last was able to post on the site. The pandemic, the horrible war in Ukraine, the re-emergence of inflation , the reduction in the rate of unemployment, the agreement between the Liberals and the NDP in the Canadian parliament, the Bank of Canada’s decision to raise interest rates. Because of all these events public policy is more complex than ever. But one thing remains fairly certain Keynes and post Keynesianism remains more relevant than ever.

The problem of supply chain disruption and its and the oil cartels’ impact on the rate of inflation which appears significant has also given the anti Keynesian neoconservatives the opportunity to falsely blame the inflation that exists on deficit spending. This misleading diagnosis needs to be corrected before policy players are seduced by it.As usual the Globe and Mail has been leading the charge from the neocon point of view.

Currently unemployment is still 5. 5% while inflation has risen to 5.7 % . But the inflation is largely due to oligopoly price increases and supply chain effects exacerbated by the war in Ukraine and the ongoing pandemic not expansion of the money supply nor excessive deficit spending or debt monetization by the central bank.

The supply side inflation is also a global phenomenon. Euro country inflation has risen to 7.5 % as of March. Inflation excluding food and fuel in the ECB rose to 3.2 % from 2.9 %. The unemployment rate in the eurozone in February was 6.8%.Oil prices for WTI oil hovers around 99 to 100 dollars a barrel, more than 40 % higher than the price in June of 2021.