Perhaps because the recent recession was so deep, many people seem to have forgotten the distinction between cyclical and long run issues. Aggregate demand policies are important in certain respects, and you’d be hard pressed to find any blogger who has complained more than I have about AD shortfalls. But nonetheless AD is a cyclical problem, a short run problem. AD can’t fix structural unemployment, and it has nothing to do with income inequality. It also has nothing to do with big government.