Who Could Have Guessed We Were at Full Employment?

Greg Mankiw

Who else?

The Evidence:

      Measuring Slack in the Phillips Curve
According to a new paper coauthored by Alan Krueger, the short-term unemployment rate works better than the standard unemployment rate in explaining changes in inflation, and according to this measure, the economy was about at its NAIRU in 2013.  This finding is related to issues I discussed in a recent Times column.   (emphasis mine)

And we get this from his NYT column:

"One possible reason for hysteresis is that the long-term unemployed lose valuable job skills and, over time, become less committed to the labor market. In some ways, perhaps, they should be thought of as effectively out of the labor force...Policy makers at the Fed may have to accept that lower employment is the new normal."

 There are somewhere between 9 and 25 million people in America that know GM is full of shit...maybe more.