The US economy suffers from two moderate maladies — mild ‘stagflation’ and its eroding global economic leadership. The term ‘stagflation’ first made headlines in the 1970s, when OPEC quadrupled the price of oil and other energy products. This, along with global harvest failures, sent inflation and living costs upward everywhere.

Those upward price spikes were not like today’s mild US inflation. That had been a time of both double-digit inflation and interest rates. No surprise that Presidents Nixon and Ford faced deep recessions at the same time that unemployment was spreading and total American output was plummeting downward.

Well, what good is advanced economic science if it cannot successfully and soon lean against both the winds of inflation and the winds of recession? As both Alan Greenspan for the White House and Arthur Burns for the Federal Reserve relearned a third of a century ago, macro policy does know how to damp down on inflation; and it does know how to stimulate spending by lowering interest rates and by well-timed fiscal deficit spending.

But whatever gets done to curb the ‘stag’ part of stagflation will worsen the ‘flation’ part of stagflation. And vice versa. Was all this essentially a flaw in the Keynesian thinking of the 1933-1968 New Deal days of Presidents Franklin Roosevelt, John F. Kennedy and Lyndon Johnson? Definitely not. The competing conservative macro views of monetarist Milton Friedman or Friedrich Hayek both then — and now — were equally impotent to end stagflation.