RUSH: The Keynesian Cure. This is a story here that the International Monetary Fund has issued an economic warning for the UK. Of course, the European Union is in a state of disarray, and what did they do? They just spent and spent and spent and spent, they followed the Keynesian theory which says that you spend and spend and spend and create deficits and that will revive an economy and that will create jobs. And of course it didn't over there and it hasn't and it's not working here. "But, Rush, the unemployment numbers are down." Yeah. You take the census workers out of this, folks, and you don't have any gains whatsoever.
EXCEPT IN GOVERNMENT
Subscribe to:
Post Comments (Atom)
5 comments:
All of the statistics that we read every day were initially gathered in response to The General Theory of Employment Interest and Money. Milton Friedman's monetarist ideas are not contrary to Keynes, they are a variation in emphasis only. Likewise, Keynes did not seek to usurp Smith's Wealth of Nations, it merely seeks to explain the many anomalies unresolved by Smith. (Smith's theory, for instance, cannot explain why people are EVER voluntarily unemployed.)
I've read all of these books. more than once; they are fascinating, brilliant, and intricate.
The oversimplified version of Keynes' ideas originate from newspaper articles during the Great Depression.
Apparently, Rush Limbaugh has not read these classic texts.
Again, Doc, you have got to read The New American Economy by (proud '80's supply sider) Bruce Bartlett. He'll explain it to you. He makes many of the same points as Eric. He also notes that Keynes was essentially conservative.
To say that Keynesian economics doesn't work is absurd. If the economies of Western Civilization have worked in the post-war era, you can thank John Maynard. The growth and development of the past sixty years has been profound.
The massive US deficits all came after supply side tax cuts. Rush may have failed to mention that.
And as Rome burned the Senate debated the origin of fire.
The welfare state, with its over promised retirement, pensions, healthcare, removal of citizens from the tax rolls and its necessary Socialism, government control of everything as a means (not as a success) of paying, has lead us to the brink of disaster.
The US is heading for a Greece type of collapse, CA is already there, how can a sane mind argue that the disaster we have arrived at, as a result of government intervention, will be cured by more government intervention?
The growth of the past 60 years is due to free market capitalism not the welfare state or government stimulus. Might also throw in a little peace dividend.
Standard & Poor's on Wednesday downgraded the debt of Spain, which is supposed to be one of the countries rescuing Greece. So in order to save Greece's creditors from taking losses, Europe's politicians will further burden the balance sheets of its other indebted nations. This bailout bet might pay off if Europe's paltry economic recovery gains enough steam to reduce various national deficits over time as a share of GDP. Greece's annual deficit is 13.6% of GDP, Spain's is 10.4% and Portugal's is 8.7%.
On the other hand, S&P's downgrade this week cited Spain's reduced growth prospects. As the nearby table shows, Europe is emerging from this recession as the world's growth laggard. In a global economy that the IMF estimates will expand by more than 4% both this year and next, the euro zone will contribute a meager 1% and 1.5%. Even Japan will do better. So creditors will have cause to ask which will come first: faster growth or the next ratings downgrade?
The neo-Keynesians who dominate today's economic decision-making seem to believe that Greece merely has a liquidity problem that EU cash can solve. European politicians and their media friends are also blaming the mess on the credit raters for having the ill-grace to downgrade debt in the middle of a crisis. Where were these critics when some of us were fighting to get the credit raters stripped of their U.S. government-favored status? Now the Europeans are merely shooting the messenger.
Free market capitalism is the foundation of Keynesian economics. Good grief! Keynes was a capitalist, my friend. You do not understand the model that you are trying to discredit.
Supply side tax cuts and a failure to pay for government have brought us to the brink. The supply siders brought massive deficits and the Keynesians (Clinton, Rubin, et al) paid the bills.
The Bush Collapse is a direct result of Republican monopoly control, their "oversight" and a failure to regulate.
Post a Comment