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Keynesian Economics and the Tea Party Network

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Christine O’Donnell, the Tea Party candidate in Delaware, has started her career on the right foot but in its own way it is the way the story is reported that is notable in its own right.

The surprise winner of Tuesday’s U.S. Republican Senate primary asked her audience at the Family Research Council’s annual Values Voters Summit to recall how it felt when President Obama took office in January 2009.

That set the stage for her to recount what Obama critics regard as disastrous initiatives that the Democratic president has introduced, including his stimulus-spending package that threw billions of dollars at what she called ‘a Keynesian fantasy.’

Most politicians and their advisers would have dismissed out of hand the idea using in a political speech the name of a long-dead British economist whose ‘pump-priming’ theory of growth inspired generations of American liberals to regard government spending as a good, not an evil.

Far from going over their heads, the reference to John Maynard Keynes drew hoots and applause from the evangelical Christians who made up most of the audience in the Regency Ballroom at the Omni Shoreham hotel.

It is difficult to tell whether the reporter was being complementary to this audience for being so sophisticated as to know who Keynes was and what Keynesian is or was just pointing up what a bunch of ignorant yokesl they were. But if he were being condescending to this audience, then the connection implied between being an evangelical Christian and knowing who Keynes was, never mind being repelled by Keynesian economics, is part of what people like O’Donnell are infuriated by.

If the reporter is so clueless himself not to see that maybe, just perhaps, this Keynesian stuff is getting to be very well known by anyone worried about public policy, and is the kind of thing that everyone should be skeptical of, if not utterly hostile to, then what’s so smart about him?

It is this sense of superiority and entitlement amongst the political elites that is now being seen for what it is by multitudes in the US. It may not immediately win them elections, but they will not be talked down to any more, specially with the failures of such mainstream policies evident at every turn.

Written by Steve Kates

September 19th, 2010 at 1:42 am

Posted in Uncategorized

30 Responses to 'Keynesian Economics and the Tea Party Network'

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  1. O’Donnell’s evangelical friends sound a lot more sophisticated than Obama’s old buddies at the church of Jeremiah Wright.

    C.L.

    19 Sep 10 at 3:01 am

  2. Russ Roberts at Cafe Hayek has a blog on Keynesian economics (apologies if you have already seen it) which introduces an example of Keynesian failure which I had not considered before: foreign aid.

    http://cafehayek.com/2010/09/does-spending-create-prosperity.html

    Capitalist Piggy

    19 Sep 10 at 8:01 am

  3. If you’re serious about libertarian principles, then the tea party is even more of a threat than the democrats (or ALP here in Oz)

    They may attack Keynes and debt, but you can’t find any serious attempt by any senior/pre-selected tea party candidate to actually do anything about the debt. Other than the vague “end pork/waste”.

    What you can find is however a strong commitment to significantly increased US defence spending, defence of most middle class welfare programs, and a wanton desire to implement more restrictive social prohibitions along the lines of their faith.

    Now these are all legitimate positions, and the tea party is nothing if not an authentic response having been fed generations of candidates who said the same things but rarely followed through.

    But the tea party is, despite the rhetoric a very non-libertarian approach to politics. And while it may be good to cheer them on so as to inflict hurt on the democrats. Little in a tea party agenda will actually be of preference to libertarians.

    Then again, my guess is libertarians and mainstream conservatives are hoping to simply ride the tea partiers into power then ignore them on policy. Which is just as condescending as any attacks made on ‘elite’ reporters who have given so much air time to the tea party and made them a legitimate political force.

    Andrew Carr

    19 Sep 10 at 8:31 am

  4. Doh. Your should be You’re. I really should have coffee before posting on Sunday mornings.

    [Fixed that. Doh should be D'oh. Sinc]

    Andrew Carr

    19 Sep 10 at 8:33 am

  5. If you’re serious about libertarian principles, then the tea party is even more of a threat than the democrats.

    Thanks, Andrew. We hadn’t heard that Krugman/Olbermann talking point before.

    Highly original.

    …a wanton desire to implement more restrictive social prohibitions along the lines of their faith.

    Sounds like the cap and trade/global warming lobby. Or maybe Gillard and Conroy on censoring the internet. But can we have evidence and citations to illustrate that the mainstream Tea Party movement has this “wanton” desire” to introduce Rudd-style social prohibitions?

    C.L.

    19 Sep 10 at 10:28 am

  6. My understanding is that the tea party is mostly about economics. There may be some alignment amongst the lose coalition of groups in the Tp in terms of social issues, but the tea party is first and foremost focused on fiscal, not social conservatism.

    In my opinion the tea party embodies the Fordism,
    “A government big enough to give you
    everything you want, is strong enough to take everything you have.”

    Americans of all persuasions are starting to realise that big government has failed to give them any of the social change they desired, but has given them mountains of debt.

    asf

    19 Sep 10 at 11:27 am

  7. Isn’t it possible that the term “Keynesian” has been popularised by the free market blogs and simply taken up as a synonym for big spending government? For example the “Boom and Bust” video was very popular. It may be stretching it to say that the Tea Party people have a sophisticated understanding of macroeconomic theory. Caveat: this is not to say that such “sophisticated understanding” is a prerequisite for having a well founded opinion.

    John Hannoush

    19 Sep 10 at 11:38 am

  8. PS Not directly on the topic but O’Donnell now seems to be on the back foot after airing of some footage from a while back where she made unfortunate remarks about dabbling in witchcraft.

    John Hannoush

    19 Sep 10 at 11:40 am

  9. Hey Capitalist Piggy (can I just call you Piggy?) Peter Bauer was writing books starting in the 1940s to demonstrate that the overwhelming bulk of foreign aid (apart from hands-on medical care) has been not just wasted but did more harm than good.

    http://www.the-rathouse.com/Revivalist4/PeterBauer.html

    Rafe

    19 Sep 10 at 12:04 pm

  10. defence of most middle class welfare programs

    Name one middle class welfare program they are in support of?

    Infidel Tiger

    19 Sep 10 at 12:15 pm

  11. The sort if libertarian who is opposed to the tea party platform should more correctly be called a Scandinavian.

    asf

    19 Sep 10 at 12:21 pm

  12. The Tea Partiers won’t acheive anything unless they end the unsustainable subsidisation of home ownership for uncredtwiorthy borrowers.

    Othewrwise, another mortgage crisis and subsequent bailouts are on the way. All it needs is a macro shock that is sharp enough in the labour market.

    .

    19 Sep 10 at 12:21 pm

  13. Via Glenn Reynold: The Doc demolishes – and I do mean, demolishes – the Palin Card and the Carr/Olbermann ‘social prohibitions’ talking point. He’s responding to Marc Ambinder of The Atlantic (yes, the publication that believes Sarah Palin faked her last pregnancy with a rubber suit) who argues it’s time for Obama to go after Alaska’s citizen Facebooker. Hang on for the last two paragraphs…

    I hope the White House takes Ambinder’s advice, because it would be suicidal. His crack about Palin’s “reveling in the culture wars” betrays his ignorance. He is confused by the details of her biography, and the sincere affection she earns from her admirers. His Palin Card is drawn from the wrong suit. She’s the Queen of Diamonds, not the Queen of Hearts. Her most impressive statements over the last two years have been on matters of economics, policy, and politics. She has shredded the Administration over health care, the Gulf oil spill, and unrestrained government spending. She’s endorsed dozens of primary candidates, with something like a 70% success rate. Her most notable clashes with “culture” have involved asking it to stop making rape jokes about her daughters.

    If you want to criticize someone for reveling in culture wars, I suggest you take a look at the power-drunk clowns tossing around gigantic bills that “control the people” right down to the menus at fast-food restaurants. Just wait until they start rolling out the class-war arguments for higher taxes to sustain their frenzied spending. That will be some serious revelry.

    Obama would be making a deadly mistake by calling out Sarah Palin for a political cage match. Let me put this bluntly: virtually no one in America gives a damn what Barack Obama says about anything at this point. What could be more predictable, and less interesting, than Obama’s opinion on any given subject? Who wants to contemplate the economic wisdom of a guy who looted the Treasury for a trillion dollars, with less benefit than we could have achieved by stuffing hundred dollar bills into random cereal boxes? Who’s excited to hear about the next plan to convert taxpayer dollars into Democrat campaign funds? Who’s hungry for another hour of tedious excuses about permanently broken markets and the titanic dead hand of George W. Bush? Who wants a lecture on ethical business practices from the titular head of the party that gave us Charlie Rangel and Maxine Waters? What use is another hollow foreign-policy speech from a man who sees no global adversary to rival the menace of Arizona? Even Obama’s supporters don’t hear anything he says any more. There’s nothing left to hear.

    Palin, on the other hand, commands attention. Lots of it comes from people who dislike her, of course, but she definitely gets people talking. Many of her detractors have a surprising ability to quote her verbatim, stretching back for weeks. Obama’s critics need Google searches to remember what he said yesterday. They can only recall that it was boring, and expensive.

    C.L.

    19 Sep 10 at 1:16 pm

  14. It may well be true that the Tea Party is only interested in economics.

    But I think Andrew is saying that individualist economics doesn’t provide any set of community values. Economic individualists have to be sanguine about people choosing to become everything from doctors, lawyers, and accountants to abortionists, drug addicts, and investment bankers.

    To provide any kind of coherent politics on non-fiscal issues (essentially only high-level macroeconomics) the Tea Party would have to find some values, and they are unlikely to be liberal. The alternative is to remain a fringe movement that never has to make the hard decisions about values that mainstream political movements do.

    Taylor

    19 Sep 10 at 1:57 pm

  15. “Even Obama’s supporters don’t hear anything he says any more.  There’s nothing left to hear.”

    Gold.

    Thanks CL

    asf

    19 Sep 10 at 2:00 pm

  16. Taylor:

    Here’s a novel idea. Perhaps the government shouldn’t be involved in the values business.

    We currently have a government that wants to ban small boobs.

    jc....

    19 Sep 10 at 2:05 pm

  17. Taylor:

    Here’s a novel idea. Perhaps the government shouldn’t be involved in the values business.

    We currently have a government that wants to ban small boobs.

    jc

    19 Sep 10 at 2:06 pm

  18. Rafe,

    Yes, I am aware of the work of Bauer, and also Easterly and so understand the problems associated with foreign aid. What made Robert’s post original (at least to me) was to show how foreign aid is a form of keynesianism, and how the failure of foreign aid is evidence of the failure of keynesianism.

    Capitalist Piggy

    19 Sep 10 at 2:12 pm

  19. JC

    Sure, but I think you’ll find Jeremy Bentham was there first.

    Taylor

    19 Sep 10 at 2:13 pm

  20. Bentham was against small boobs?

    C.L.

    19 Sep 10 at 2:30 pm

  21. Not to my knowledge. Is the Tea Party?

    Taylor

    19 Sep 10 at 2:52 pm

  22. Infidel Tiger – Here’s a big one: Medicare. Obama wanted to cut it as part of his healthcare changes, the tea party & palin (not to mention the mainstream republicans) made defending the program central to their arguments.

    The tea party is an authentic movement that rails against the broken system of government in Washington. But it has zero policies for fixing that government. Actual Libertarians like Ron Paul do, and the odd mainstream republican like Paul Ryan does too. But these are the rare, rare exceptions in a movement which is all rhetoric and no policy suggestions (unless you count Gindrich’s latest bid to ban Sharia Law in the USA. Tackling the big issues there newt)

    I’m not a libertarian, but its an ideology of important and serious principles that deserves a bigger say in our political debate. The tea party is literally a child’s version of libertarianism. All angst and feeling, with no adult attempts to solve any of america’s major problems. Solving America’s problems will require big compromises from both sides. But the nature of the tea party & US right at the moment is to drive from the field any who suggest that compromise is a worthy word. Just look at the hounding Karl Rove got for worrying that O’Donnell was too far to the right, for the tea party there is no such thing.

    As for social views, while there are some small exceptions to each of these the tea party has largely swung behind the invasive Arizona immigration laws, demanding further restrictions, demonised muslims wanting to build a mosque in New York on private property, and resisted DADT’s repeal, Gay Marriage, and reform of the drug laws.None of those stances is in line with libertarian views.

    I wish democrats (and the ALP) were far more libertarian in all those areas mentioned, but where they are slowly seeking to liberalise social actions, the tea party is encouraging conservative resistance to it. Of course libertarianism has always been more dominated by concerns over economic than social policy, but I can’t see how beyond mouthing the words ‘down with big govt’ and a desire to give a black eye to the left, there is any substantive basis between libertarians and tea partiers.

    Andrew Carr

    19 Sep 10 at 4:04 pm

  23. Just look at the hounding Karl Rove got…

    LOL. So one minute you’re pretending to want to clean up “the broken system of government in Washington” and the next minute you’re saying Karl Rove (of all people) is a victim.

    …the invasive Arizona immigration laws.

    Which are modelled on Federal law.

    …demonised muslims wanting to build a mosque in New York on private property.

    Between 60 and 70 percent of Americans are against the Muhammed Atta Memorial Mosque.

    Gay Marriage

    It was the Tea Party’s fault that gay “marriage” was defeated in California? It was Sarah Palin’s fault that Barack Obama was and is against it?

    reform of the drug laws

    Sarah Palin Calls Marijuana Minimal Problem.

    More liberal than Bill ‘Didn’t Inhail’ Clinton.

    C.L.

    19 Sep 10 at 6:52 pm

  24. I wish democrats (and the ALP) were far more libertarian in all those areas mentioned, but where they are slowly seeking to liberalise social actions, the tea party is encouraging conservative resistance to it.

    “…slowly seeking to liberalise social actions…”

    What a horrifyingly totalitarian phrase.

    Rudd and Gillard introduced or pursued a crackdown on alcohol, cigarettes and the internet, declared a “national emergency” (the first political one since Joh Bjelke-Petersen declared a State of Emergency to deal with anti-Springbok protesters) and Rudd regularly addressed the nation from a churchyard on Sundays.

    I haven’t heard one Tea Party member advocate any of these embarrassing measures.

    C.L.

    19 Sep 10 at 7:00 pm

  25. C.L.

    19 Sep 10 at 7:20 pm

  26. Medicare? From what I can find, Palin has suggested providing Medicare recipients with vouchers to purchase insurance on the private market – similar to policy suggested by the Cato Institute. In any case, there is a substantive difference between opposing the continued growth of government and wanting to cut social security programs that people have counted on to be there for them in their old age. A gradual transition away from State welfare is the sensible approach, not hard-headed idealism.

    As for your other points, they are typical lefty talking points. You are not a proper Libertarian unless you are in favour of building a mosque across the street from Ground Zero? Please. It is an utterly offensive idea. I acknowledge the right, but I detest the idea. And the American economy is up the proverbial creek and you want Libertarians to stand up to the only movement offering any solutions because they don’t seem to fancy gay marriage and liberal drug laws? Get a grip. Besides, the Liberal elites have caused great offence by ramming through polices opposed by the vast majority of Americans (i.e. Obamacare), it would be equally offensive for Libertarians to want to foist a law on Americans that has been overwhelmingly rejected every single time it has been put to a popular vote (i.e. gay marriage).

    asf

    19 Sep 10 at 7:25 pm

  27. boy on a bike

    19 Sep 10 at 10:23 pm

  28. “…demonised muslims wanting to build a mosque in New York on private property.

    Between 60 and 70 percent of Americans are against the Muhammed Atta Memorial Mosque.”

    “it would be equally offensive for Libertarians to want to foist a law on Americans that has been overwhelmingly rejected every single time it has been put to a popular vote (i.e. gay marriage).”

    The above are conservative positions not liberal (or libertarian) positions.

    Liberals typically insist on defending individual freedoms in the face of an unwilling majority.

    Taylor

    20 Sep 10 at 8:52 am

  29. So what is your argument Taylor? That the tea party doesn’t have any social values or that it does and they are conservative?

    The mosque is offensive. Most of the opponents of the mosque do not oppose the right of the mufti to build what he wants on his own land, they are just making the point that building a mosque at that particular site is offensive. I defend his right to be offensive, but I certainly won’t encourage it.

    State sanctioned marriage is the very opposite of freedom so I’m not sure how your argument applies.

    asf

    20 Sep 10 at 9:26 am

  30. Liberals typically insist on defending individual freedoms in the face of an unwilling majority.

    Which is why far more Republicans than Democrats supported the 1964 Civil Rights Act.

    And why US liberals are always trying to undermine the second amendment.

    And why they ban light bulbs and keep churning out regulations and prohibitions in relation to everything from salty foods to bicycle helmets.

    They’ll cheerfully ban construction close to the seaside on grounds of an allegedly imminent deluge caused by “climate change” but they’re horrified that anyone would seek to halt the building of the Mohammed Atta Memorial Mosque in New York.

    C.L.

    20 Sep 10 at 10:13 am

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