Monetarism, as a specific policy of targeting the money supply to fight inflation, foundered on the rocks of defining what money in the modern world actually is back in the 1980s. But its legacy of assuming a natural rate of unemployment has been critical in sustaining arguments against spending and compensation. After all, why spend to get past the natural rate when that will only ever produce more inflation? If unemployment is “structural,” and not due to a lack of demand, then spending will not have any effect on it, so we should not try. The fact that the “natural rate” jumps around far too much across countries and time periods to be reduced to structural factors or unionization rates has done nothing to discredit it.

Mark Blyth, Austerity, loc. 427