Free Republic

In a September 11 Bloomberg article, economist Noah Smith claims that John Maynard Keynes, the architect of today’s government economic policies around the world, wasn’t a “‘socialist’” or even a “‘progressive.’” He did not favor “a command economy.” Yes he “was in favor of some amount of wealth redistribution and government intervention into the economy.” But “Keynesian policies are fundamentally … about economic stability,… about smoothing out the fluctuations in the economy, reducing risk for everyone concerned.” “Stabilization theory says that you can smooth out the wrinkles of the business cycle without messing with the deep structure of how the...

Most Americans think jarring economic problems will erupt if lawmakers fail to increase the government’s borrowing limit. Yet they’re torn over how or even whether to raise it, leaning toward Republican demands that any boost be accompanied by spending cuts. According to an Associated Press-GfK poll, 53 percent say that if the debt limit is not extended and the U.S. defaults, the country will face a major economic crisis. An additional 27 percent say such a crisis would be somewhat likely, while just 17 percent largely dismiss the prospects of such damage. … “The worst thing for the economy is...

Paul Krugman, a liberal economist and New York Times columnist, said increased government spending is key to economic recovery. During an interview on Friday on “Moyers & Company,” on PBS, Bill Moyers asked, “And you argue that this could actually be solved in two years?” …

New York Times columnist Paul Krugman said it is “frightening” that the Obama administration has never included progressive economists, who have “been right about everything so far.” “I think it’s frightening that at no point in this administration have there been any serious representation of what you might call the progressive economist wing, which is a pretty big part of Obama’s support,” Krugman said Sunday in an appearance on ABC’s This Week with George Stephanopoulos. … Krugman, a Keynesian economist, has long advocated for more stimulus spending, saying the $833-billion stimulus package of 2009 did not spend enough. …

Does anyone remember the American Jobs Act? A year ago President Obama proposed boosting the economy with a combination of tax cuts and spending increases, aimed in particular at sustaining state and local government employment. Independent analysts reacted favorably. For example, the consulting firm Macroeconomic Advisers estimated that the act would add 1.3 million jobs by the end of 2012. There were good reasons for these positive assessments. Although you’d never know it from political debate, worldwide experience since the financial crisis struck in 2008 has overwhelmingly confirmed the proposition that fiscal policy “works,” that temporary increases in spending boost...

In the mid-1800s, a cousin of Charles Darwin by the name of Francis Galton wrote a series of works expanding on an old idea of selective breeding in human beings. Galton’s theory became known as eugenics. At its core, eugenics was underpinned by an assumption that talent and genius were hereditary traits, and that deliberate breeding could improve the human race. Within decades, intellectuals were spending their entire careers studying these ideas, quickly spawning a number of different fields dedicated to ‘racial sciences.’ Scholars began closely examining racial differences and building volumes of statistics on everything ranging from intelligence to...

It seems that any argument about the economy eventually boils down to the core issue of whether government spending acts as a stimulus or whether it is – in the words of Thomas Sowell – a sedative that undermines prosperity. So when Robert Reich and I went on Erin Burnett’s CNN show to discuss Obama’s stumbling economic performance, much of our discussion focused on whether to further expand the burden of the public sector.Dan Mitchell Debating Keynesianism with Robert Reich on CNNHere are a couple of observations about the interview. Reich admitted that spending is a problem and in the...

CAMP DAVID, Md. — Leaders of the world’s wealthiest nations opened the door Saturday to more government spending in Europe as way to revive the continent’s struggling economy, shifting away from the idea that the surest way to recovery was through strict fiscal austerity. Meeting at the Group of Eight summit at Camp David, President Obama and his fellow leaders said they were committed foremost to creating jobs and growth, a shift, at least in emphasis, from previous gatherings dominated by German efforts to reduce high government debt through drastic fiscal reform. In a joint statement, the leaders of eight...

From the U.K. Spectator's report on the amazing success of supply-side economics in Sweden, and finance minister Anders Borg, the man behind it: "When Europe’s finance ministers meet for a group photo, it’s easy to spot the rebel — Anders Borg (pictured above) has a ponytail and earring. What actually marks him out, though, is how he responded to the crash. While most countries in Europe borrowed massively, Borg did not. Since becoming Sweden’s finance minister, his mission has been to pare back government. His ‘stimulus’ was a permanent tax cut. To critics, this was fiscal lunacy. Borg, on...

The Greek government has decided to rent out its police officers as security guards to businesses and private individuals as a way to deal with its debt problems. The police announced on Monday that officers may be hired to provide protection services, such as escort for people transporting works of art or large amounts of money. Prices start at about 40 dollars an hour for a single police officer and 65 dollars for an officer with a police dog. If the job requires a helicopter, it will cost about 2,000 dollars. The police said the rent-a-cop service will not interfere...

Jerry Jordan makes the case against what he call K-brand economics. (HT: Dan Klein) Very well done. An excerpt: It is tempting to think that the Soviets perfected negative-value-added investment — the stuff produced is worth less than the value of the resources to produce it. However, most families have experienced this first hand. It usually surfaces with an entrepreneurial adolescent deciding it would be a good idea to sell lemonade at the curbside to passersby Parents, wanting to encourage the idea that working and making money is a good idea, drive around to buy the lemon, sugar, designer bottled...

A pair of articles by Austrian economist professor Antal E. Fekete just might have one wondering who is more in the loony bin, mainstream economists like Krugman or those consistently chanting about the death of the dollar coupled with hyperinflation. Premature Obituaries Please consider Premature Obituaries It is open season for wild monetary prognostications. More premature obituaries on the dollar have been posted on the Internet. For example, see Jim Willie’s The US Dollar Paper Tiger (Gold-Eagle, January 11) with epitaphs like “the U.S. dollar rising to the cemetery”, or “dollar death dance”. Or see another article, Jeff Nielsen’s entitled...

Accumulated budget deficits of $15.2 trillion and unfunded entitlement liabilities of $117 trillion cannot dissuade Paul Krugman, New York Times columnist and Princeton University professor, from his belief that government must go many trillions more into debt immediately to rescue Barack Obama's presidency. In his latest column extolling the virtues of the late British economist John Maynard Keynes, Mr. Krugman asserts anew that the nearly $800 billion Obama stimulus of 2009 failed to produce 4 million new jobs and keep unemployment under 8 percent simply because it was too small. (He has argued $2.9 trillion of government pump-priming was the...

For a while, there has been a strain of center-left American commentary that has viewed China's leaders as some kind of technocratic super-geniuses who have done a much better job of guiding their society than the loons and hacks who would actually, you know, be voted for. Call this the Tom Friedman school of thought. In reality, China's leaders have a tendency to fall for a lot of the same economic fads that fascinate the Western center-left elites. Thus, the Chinese have been suckered into investing untold billions in high-speed rail and "green energy," endeavors that are not economically viable...

Just when you thought Keynesian economics was finally dead among Republicans, Mitt Romney announces two prominent New Keynesian academics, Greg Mankiw and Glenn Hubbard, as the heart of his economic team. So if you loved how Obama has managed to continue the flawed economics of the Bush administration*, you’ll feel pretty safe with Romney. Sadly the real problem goes beyond Romney and Obama. The financial crisis and the government’s response to it illustrate the failure of much of mainstream macroeconomics. Yes, the Romney team would have had its stimulus proposal tilted more toward temporary tax cuts, but it still would...

What are the top ten Federal regulations that, if aboloshied FOREVER would create the most work. Yep, I said work! What we need is WORK! Harken back with me to the days of yore when, in the 1930's, trainloads of men crisscrossed this poverty-ridden country, (why was crime so low, but that is another post to come). Anyhow, these impoverished men did not look for "jobs," THEY LOOKED FOR WORK ! Time to push back from the table of consumption and start working to produce things to be consumed. So, to decrease the damned Federal payroll and boost the number...

Noted unprofessional economist, Paul Harvey once said, " WHEN YOUR OUTGO EXCEEDS YOUR INCOME, YOUR UPKEEP WILL BE YOUR DOWNFALL. " That was fine back in the day before we had credit cards, but now we know that " Change [ read: Keynesianism ] has come to America. " At least that is what Professor You Lie said back in January, 2009. Well, here we are in September, 2011 and 4,000 billion dollars poorer, and still the basic question remains: Are we better off poor and freed from being "To Big to Fail" like those bad old private companies we...

It was the first Monday of the month, and a line numbering more than a hundred spilled from the doors of the District's largest food stamp office and down the sidewalk nearly a half-block to the corner of Seventh and H streets NE. Children darted among the adults as the procession moved at a funereal pace toward the building -- a 10-minute walk from the U.S. Capitol -- where food stamps are dispensed. The hustlers who trade drugs, stolen goods and cash for food stamps waited patiently outside for people to emerge clutching books of stamps. "For a $65 book,...

Via Timothy Carney, this appears to be real. Is it real or just a goof? Kevin Williamson isn’t sure and neither am I, but given that this is the same guy who fantasized recently about the Keynesian awesomeness of an alien invasion, it’s at least a toss-up. All day long I’ve felt relieved that the quake caused only very minor damage, but now suddenly I’m bummed that the Brooklyn Bridge didn’t fall into the river. Maybe we can get DHS or the NYPD to blow it up? That’s a few thousand jobs right there.

It’s been many years since I’ve read The New York Times. Like most readers, I got discouraged by the shrinking page size, the self-confident erroneousness that becomes apparent whenever America's newspaper of record covers a topic I’m familiar with, and the lack of a comics page. Sure there are occasions when you can’t avoid it—usually when enough people are complaining about an article or when somebody I know is in the paper—but on a daily basis I follow the golden rule that life is just too short for The New York Times. So imagine my surprise the other day when,...