Minneapolis Fed Vice President Preston Miller suggests that long-term federal budget problems, exacerbated by the needs of an aging population, might be alleviated by a new approach to funding benefits received by that same aging population.

We deduce properties of optimal monetary policies based on modern theory and standard empirical findings. In light of this analysis, we examine FOMC policy procedures and conclude that they put too much emphasis on short-term economic stabilization and too little emphasis on longer-term price...