Bruce Bartlett worked for Ron Pual in his first term as an ardent Austrian (and the author of a not-bad work on Pearl Harbor revisionism). Then he moved to Kemp as an ardent supplysider; then he was an official in the Reagan and Bush I Treasury; then he worked for NCPA, a libertarian neocon outfit, and was very close to Cato; now he is a plain leftist and open Keynesian.In his recent NYT column, Bartlett makes it clear that he is indeed a Keynesian. He writes:
...as the Harvard economist Kenneth Rogoff has argued, a short burst of inflation would do more to fix the economy’s problems than any other thing. One reason is that inflation raises spending by encouraging consumers and businesses to buy things they need immediately because prices will be higher in the future.This is as Keynesian as you can get, with talk of boosting aggregate demand to get the economy going.
The right policy can be debated, but the important thing is for policy makers to stop obsessing about debt and focus instead on raising aggregate demand.
"Boosting aggregate demand" is code for growing the size of government. It's not bureaucratic governmentt spending that boosts an economy. It is increased private sector production meeting the demands of consumers that boosts the economy. Any steps taken to "boost aggregate demand". i.e. increasing government spending, actually slows down economic growth by taking resources away from the private sector.
Bartlett prefers the boom-economy NOW to the liquidation of poor investment and real, meaningful growth LATER. He discards any thought of the inevitable bust that MUST result from inflationary activity.
ReplyDeleteJohn Maynard “In the long run we’re all dead” Keynes, apparently, lives on.
Never mind the fact that we’ve inflated more in the last 3 years than in our entire history and it hasn’t worked. They Keynesian answer is that we didn’t inflate ENOUGH to fix the problem. Perhaps even in Zimbabwe, Weimar, etc., they just needed to add a few more zeroes to the paper to make it works…?
Men can be so corruptible.
ReplyDeleteA great wise man once said "You can't fix stupid".
ReplyDelete'Nuff said.
The politicos have the power and Bartlett knows it. American Industry and Business caved into government during the WWII days and never regained any independence.Have you all forgotten Vivian Kellems and her one woman assault on business withholding taxes! The market did not back her! All this nonsense about the market shaking everything out is sheer lunacy! We are not dealing with business these days, we are cartelized and any economist worth his salt knows it!
ReplyDeleteSeeing spineless men snake their way to positions of power makes me gag.
ReplyDeleteHe's a smart man.
ReplyDeleteHe's decided to grow wise rather than rigid.
His book "New American Economy" is comprehensive and well researched.
Mainstream economists avoid the "Austrian School" the way Evangelical snake dancers are avoided by brain surgeons. I don't blame anyone for experimenting in their teens, but you can't sour on a guy for growing up.