ttempt to make money fast enough to increase their real wealth. This is bad for the economy in the long term.
Controlling inflation is good for the economy in the long term, but it has costs in the short term. Inflation is typically controlled by reducing government spending and/or increasing taxes (fiscal policy) or by reducing the money supply through such things as higher interest rates (monetary policy). If governments take this sort of action, they will reduce aggregate supply and demand in the short term. If, for example, interest rates rise, individuals and firms will not borrow as much and will therefore not spend as much money. This is bad for economic output in the short term.
Trying to decrease unemployment is much harder unless the government simply puts people to work through creating government programs. Otherwise, the government has to try to coax businesses to hire more people. The government can try to do this through such methods as lowering taxes and interest rates, but it cannot force firms to hire if the firms are too worried about the state of the economy as a whole. This was one reason why the US economy did not rebound as much as it might have given the government stimulus packages after the financial crisis of 2008.
There are also costs associated with trying to reduce unemployment. The most common cost is an increase in governmental deficits and debts. Governments typically try to reduce unemployment by increasing government spending and/or lowering taxes. This harms the government’s budget balance, increasing the size of the government deficit. This may be relatively harmless in the short term, but it can have serious long-term effects.
In my view, zero inflation is not a wise target. In a perfect economic world, it would be a good thing. There would be complete certainty, which would lead to greater economic growth. However, in the real world, sticky prices and (more importantly) wages make zero inflation a bad idea. If there were no inflation, firms would not hire as many people as they otherwise would. They would not hire as much because they would not have any acceptable way of cutting their wages relative to their costs. The only thing they could do would be to lower nominal wages, but this would generally make their workers very upset and would harm the firm.