Skip to comments.Keynesianism Questioned By Harvard Researchers
Posted on 06/04/2010 8:12:01 AM PDT by bs9021
Keynesianism Questioned by Harvard Researchers Bethany Stotts, June 4, 2010
Contrary to the Keynesian theory that government spending can spark economic growth in times of recession, a new study demonstrates that pork, at least, may damage corporations within the states that receive these federal dollars. The three Harvard Business School (HBS) researchers, Lauren Cohen, Joshua Coval, and Christopher Malloy, surveyed the 232 times in the last 42 years that a Senator or Representative on capitol hill obtained a chairmanship on a powerful congressional committee and then measured the impact the corresponding increase in earmarks had on publicly-traded firms in that senator or representatives district.
Their study cites Senator Richard Shelby, R-Ala., as a prime example: while Alabama averaged 6 million dollars less in annual earmarks than the average of other US states before Shelbys appointment, they averaged over 90 million dollars more than other states after his appointment, they write.
According to the 2010 Citizens Against Government Waste Pig Book summary, Sen. Shelby earmarked at least $61.6 million for 30 projects in his position as the ranking member of the Senate CJS Appropriations Subcommittee, including,
* $14,000,000 for the Cooperative Institute and Research Center for Southeast Weather and Hydrology at the University of Alabama;
* $6,000,000 for six projects for the Marshall Space Flight Center in Huntsville;
* $1,000,000 for the Tools for Tolerance program at the Simon Wiesenthal Center in Los Angeles, California; * $250,000 for a wireless area network for the city of Hartselle (population 13,888);
* $200,000 for the Cherokee County Methamphetamine and Marijuana Reduction program;
* and $150,000 for Zelphas Cultural Development Corporation for the University of Alabamas After-School Delinquency Prevention program....
(Excerpt) Read more at academia.org ...
If it took this long for Harvard to realize that Keynesianism is bad economic model then it really says something as to the general cluelessness of Harvard’s economics department.
Today in the US however, we have Kenyanesianism instead of Keynesianism
Look at GE, when their Government Dollars are yanked, the Company is going to collapse.
Keynesianism has failed every time it has been tried.
I wonder is these are now former Harvard Business School (HBS) researchers?
Governments BLOW BUBBLES that appear to be stimulus until they collapse under lesser demand. The private market provides the only real stimulus because it is based on a sustainable profit motive.
Why did they choose ONE SOUTHERN Senator who changed from Being a Democrat to being a Republican????
Finally, something that makes sense gets credit!
Keynesianism has never worked, not once, anywhere.
Keynesianism is an intellectually corrupt excuse for politicians to do what they always want to do: Spend More.
In fact, their study showed that companies retrench in the face of earmarked federal dollars. This conclusion was unexpected, asserted Prof. Coval in the interview. Our original goal was to investigate how politically connected firms benefit from increases in the power of their representatives, he claimed (emphasis added).
Liberal statists don't care if Keynesianism actually works or not. All they are looking for is an excuse to increase the size and power of government.
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