BIS Review 125/2009  1  *** It was just last year at this conference that I first proposed that the fiscal crisis – then emerging into full view – could best be addressed by looking back a few years to where we had been around the turn of the millennium in terms of the shares of taxation and spending in GNP.
Those years define the end of the thoroughly healthy and sustainable path of aggregate activity. Getting back to those shares seemed like an appropriate target. I believe that this approach to repositioning the budget remains a useful one.