Friday, 16 July 2010

“The Myth that Laissez Faire Is Responsible for Our Present Crisis”

I see that this piece by George Reisman written in the teeth of the crisis is doing the rounds again, and with good reason.  It’s still among the most thorough explanations of what happened, and how it could have been avoided.  

So if you genuinely want to know what happened (that is, if you’re not a liberal who’d rather not be told), then take a(nother) read while you’re waiting for my regular ramble.  Go on, click that link…

The Myth that Laissez Faire Is Responsible for Our Present Crisis - George Reisman

     “The myth that laissez faire exists in the present-day United States and is responsible for our current economic crisis is promulgated by people who know practically nothing whatever of sound, rational economic theory or the actual nature of laissez-faire capitalism…
    “The utter absurdity of statements claiming that the present political-economic environment of the United States in some sense represents laissez-faire capitalism becomes as glaringly obvious as anything can be when one keeps in mind the extremely limited role of government under laissez-faire and then considers the following facts about the present-day United States…”


  1. Excellent explanatory article there from George Reisman. There is always something to take home which is informative when one is coming here to Not PC to read. I mean vital & useful info that one cannot get anywhere (locally), neither from Kiwiblog nor Bernard Hickey, etc...

  2. Tom Hunter said....

    The following is not (ahem) peer-reviewed, but you might want to have a crack at it and pass it on to others.

    It's basic argument is that one can't argue that cutting taxes grows the economy (in terms of GDP per capita). Although they're also clearly pushing the argument that increasing taxes does not prevent an economy growing - and implying that such might even grow the economy better. The folks at The Dim Post are very excited about this of course.

    I'm going to take a look at how they calculated their tax burden data, because a couple of things about the headline graph are suspicious: JFK's starter was cutting taxes for high incomes and (I think) high marginal rates, and of course we know about Hoover's huge increases in the tax rates for high income earners - the people who you would think carried the burden of the income tax pie then as now.


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