Firstly, Mr. Marston, in regard to your earlier points, we really do have a serious problem. While monetary and fiscal policy in Canada was tremendously important at the outbreak of the crisis at the end of 2008 and the beginning of 2009, we have stalled since roughly the spring of 2010. We've had no continuation in recovery in employment rates, in per capita incomes. Governments and consumers are both maxed out on their credit-fueled spending. The business sector has not kicked into gear in the way that it needs to. So we still have a problem, without taking away the value that came from that stimulus effort. The stimulus has been over for a while, and we're not out of the woods yet. We're going to need more help.
In terms of the inflation-targeting regime, it clearly did limit the Bank of Canada's ability to respond, because we were starting from such a low level of inflation in the first place. So you reached the zero bound on policy very quickly. If we had targeted inflation at a higher level or if we hadn't any target or if we just had higher inflation, they would have had more flexibility. One of the most powerful arguments against the 2% target, anyway, if not against targeting in general, is the problem that happens when interest rates get to zero.
I think that was Mr. Sumner's point as well. If the target had been at nominal GDP instead of inflation, there would be an added dimension of flexibility where the bank could have gone after it more aggressively. That being said, I think our bank was creative and committed in what they have tried to do. I don't think inflation targeting helped their effort and I think in some ways it probably constrained it.