While almost all commentators ignore what used to be called the long-run, there is one eminent exception today. Charles Goodhart of London is perhaps Britain’s most distinguished economic commentator. With a colleague, he has just co-authored a new book arguing that longer-term inflation will indeed be much higher than it has been during the past 35 years. The reason for his view is highly unorthodox - and, in our opinion, correct.

Goodhart points out that a main reason for disinflation since 1985 has been the stagnation in US wages. Because of automation, foreign competition for US jobs, and the weakened bargaining p...