What’s amazing about this strategy is that it wasn’t secret. They published it in the Wall Street Journal in 1974. It still worked. Similar to the “flood the zone” strategy; Steve Bannon straight up talked about it to the press in 2018. That also still works.

There’s just one problem: you can’t keep burning down the house around you and then blaming the people trying to stop it.

Right from one of those articles (“It’s Time to Cut Taxes” by Jude Wanniski):

“The level of U.S. taxes has become a drag on economic growth in the United States,” [Professor Mundell] says. “The national economy is being choked by taxes — asphyxiated. Taxes have increased even while output has fallen, because of the inflation. The unemployment has created vast segments of excess capacity greater than the size of the entire Belgian economy. If you could put that sub-economy to work, you would not only eliminate the social and economic costs of unemployment, you would increase aggregate supply sufficiently to reduce inflation. It is simply absurd to argue that increasing unemployment will stop inflation. To stop inflation you need more goods, not less.”

Which is interesting, because the ultimate solution to stagflation–which was a problem that reared its ugly head in the few years before the article was published–was to do the “simply absurd”. Paul Volcker as Fed Chair would eventually say fuck it, we’re sending interest rates to the moon. That caused a spike in unemployment, but it brought inflation under control. Then you bring interest rates back down and unemployment sorts itself out.

It’s harsh medicine, but it works. Kept capitalism going for several decades more. Of all the possible solutions to stagflation, this remains the only one that’s been tested to work.

These people have been wrong for decades and fought against strategies that save their own economic system.