Extract from 1990 Boyer Lectures by Tom Fitzgerald
Fitzgerald, Tom, 1990, Between life and economics,
Crows Nest, N.S.W, Australian Broadcasting Corporation
This is a very strange period in our economic history; I shall be suggesting
it is the strangest. That does not mean a very severe period; people have
been generally affluent, despite hight interest rates and inflation. The
uniqueness of this economy is the extent that it is out of control…
The exchange rate and the money supply are more completely out of control
than they were in the admittedly imperfect days before financial deregulation.
To say such a simple thing the presence of some people is to embarrass
and alienate them: much worse than to commit a breach of table manners….The
present fluctuating exchange rate is nobody’s logical exchange rate…From
the viewpoint of providing directions for the making of economic policy,
the exchange rate may be added to such a list as the Japanese economists
have prepared of cases of market failure. The market fails to do the required
job. And that is an absolutely fundamental defect for a country whose
balance of payments is chronically adverse….
One of our present problems is this: We have in charge of economic policy
a high proportion of people who landed us in trouble, and nobody who is
known to differ from them, or is even allowed to do so. Keynes used to
say how wonderful it would be if economists were humble, competent people
on a level with dentists.