For example, in the nineteenth century, it was normal to think of a relatively stable average price level over fairly long periods, but with noticeable fluctuations around the mean over periods of some years – with periods of inflation being followed by periods of deflation.
If our deficit remains at 3%, it is clear that we are heading towards serious debt sustainability problems. So we shouldn’t listen to those good people who think that there is a jackpot when the deficit is a fraction below 3%. It is a bit like giving an alcoholic sweet to a former alcoholic, so to speak, it seems to me a little dangerous.