Keynes: how the evil that men do lives after them

Dang insomnia!

A nice mini-essay by Pete Boettke at Coordination Problem (was The Austrian Economists).

Stiglitz is right to stress that bad ideas result in bad public policy which in turn results in bad economic, political and social outcomes. But, Stiglitz has misidentified what the bad ideas are, and his narrative mischaracterizes the nature of public policy for the past 6 decades and in particular the last 2 decades. We have not experienced a period of neo-liberal neglect and arrogance, but instead a waffling back and forth between conservative and liberal Keynesianism guided by an illusion of an artistic rendering of economic and political life. This has been the public policy hegemony for the past 60+ years. It is time that this alternative narrative be listened to, rather than the same old story that emerged from the Keynesian follies so many decades ago.

In the words of the bard.

Paul Samuelson was brilliant too. Check out his commentary on the comparative performance of the Russian and US economies through the 1950s.

John Nevile of the Uni of NSW reviews a book on the Keynesian revolution in America. For Samuelson, to be young at that time “was very heaven” (a steal from Wordsworth on the early optimism of the French Revolution, a nice piece of irony that eluded Samuelson).

Recycling one of my pieces from Club Troppo. The name of the author had to be changed to keep the post alive after I was dropped from the roster in the wake of a 700 comment “thread of doom” on Climate Change .

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10 Responses to Keynes: how the evil that men do lives after them

  1. Lily taters

    loved the comments on the “thread of doom” a mere 2 years ago scoffing at Rafe’s reference to Monckton”s doubt about a 2 degree rise in temperature.

  2. Blogstrop

    Didn’t the Wombat Whisperer start making derogatory comments about the coalition’s policy settings during 2007?
    And wasn’t he the adviser that said go early, go hard, go household, in response to the GFC?
    I don’t think he ended up enjoying what came about in later years when his tax review was comprehensively ignored, policy became truly idiotic and the budget was stuffed.

  3. MartinG

    I don’t think this is on topic but if your willing to struggle through Christine Lagardes Richard Dimbleby Lecture you will see what an economic fascist bitch she is.

    http://www.imf.org/external/np/speeches/2014/020314.htm

  4. Jim Rose

    great post rafe.

    On central banks and bad ideas, as Greg Mankiw noted in a great 2006 JEP article:
    • Autobiographies and other hands-on sources show that recent developments in business cycle theory by new classical and new Keynesians have had close to zero impact on practical policymaking at central banks.
    • Central banker’s analysis of economic fluctuations and monetary policy as discussed in their autobiographies are intelligent and nuanced, but it shows no traces of modern macroeconomic theory, and would seem almost completely familiar to someone who was schooled in the neoclassical-Keynesian synthesis that prevailed around 1970 and has ignored the scholarly literature ever since.

  5. .

    MartinG
    #1185596, posted on February 11, 2014 at 9:00 am
    I don’t think this is on topic but if your willing to struggle through Christine Lagardes Richard Dimbleby Lecture you will see what an economic fascist bitch she is.

    I told you, I fucking told you…

  6. Jessie

    Rafe, in the interests of furthering my education would you kindly direct me to an alternative link, as the one provided at Coordination Problem does not work. see below

    The promisory politics that exploded after WWII can be, as James Buchanan has explained, rests completely with the Keynesianism — Download Buchanan- Keynesian Follies.

    At least in the Thread of Doom blogger Tim had this to say about you. 700 comments, a stirrer are you?

    Rafe, you seem like a generally pretty smart and interesting guy. It’s a bit unfortunate you seem to have fallen into the predictable Libertarian trap of reflexive climate change denial.

  7. Andrew

    If the RSPT was an indication of the intellectual quality and academic rigour that went into the entire Henry Review, then
    a) I’m very pleased that the Goose had the good fortune (I doubt it’s attributable to sense) to ignore the rest of it, and
    b) I don’t think he’s fit to be entrusted with matters as important as the feeding of wombats.

  8. Rafe

    Hi Jessie, that link should have taken you to the “mini essay”, this is the link to the site.

    http://www.coordinationproblem.org/

    I never thought of myself as a stirrer until that post blew up! And I just wanted to help :)

    As predicted, Labor did crash and burn due to the Green alliance.

  9. Jessie

    Thanks Rafe,

    The link to site coordination was OK. It is the link they provide to Download Buchanan- Keynesian Follies.

    Their link gives a blank page, and I tried various methods: open directly, new tab and save as. Tried a straight search on the article- no luck.
    their link: http://austrianeconomists.typepad.com/files/buchanan–keynesian-follies.pdf
    and a search

    It is good you want to help!

  10. Rafe

    Hi Jessie, maybe they fixed the link, it is slow but it came up today, Wed in Auckland. Did not try the other day.

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