Thursday, 10 September 2015

Keynes: the good, the bad, and the truly freaking horrible

Pedro Schwartz at EconLib has a nice overview of the devilish John Maynard Keynes—the good, the bad, and the truly freaking horrible.
This defunct economist, both when he was right and when he was so very frequently wrong still casts a long shadow across the paths of would-be economists.
The conundrum is why so many swear by his name though so little has been kept of the original model of his General Theory of Employment, Interest, and Money (1936), except his insistence that aggregate demand is the main mover of the economy and that the price system does not function well.
There’s a few things I’d disagree with in the piece—he mischaracterises Say’s Law, for example—but it’s a very good piece, especially about what the early Keynes managed to get right (such as his defence of the quantity theory of money against the very inflationism he later championed) and what he later got so wrong.
Interesting insight too into what unites today’s new- and neo-Keynesians, i.e.:
At bottom, what unites all these neo-Keynesians is the belief that the free market will fail unless political authorities mend it and prop it up continuously.
And, of course, they rather fancy being those political authorities.
Read: Keynes as Lucifer – Pedro Schwartz, ECON LIB

1 comment:

  1. The problem Is not the free market: it's just that many people - bludgers - are with zero or less.

    Interfering with the market is as stupid as legislating that the earth is flat or that Pi=3.

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