Friday, August 5, 2011

Tyler Cowen: We Needed More Inflation after the Downturn

Yesterday, I questioned whether Tyler Cowen, GMU economics Prof, was serious about calling for more inflation. Bob Murphy in the comments wrote that  Cowen was serious:
He's serious. He reads Scott Sumner, who has cast a spell on most of the profession at this point. They honestly believe Bernanke has been stingy with monetary policy all along.
As if to prove Murphy's point, Cowen, today, writes
Ken Rogoff and Scott Sumner are likely to go down as the prophets of our times. We needed a big dose of inflation, promptly, right after the downturn.  Repeat and rinse as necessary.  But voters hate inflation and, collectively, we proved to be cowards.  Too bad.
This is what D.C. libertarianism has come down to, calling anti-inflationists cowards? Please pass me another gold coin.


  1. This shows what frauds most "libertarians" not related to the Mises institute really are. To hell with them.

  2. We are all quasi-monetarists now.

  3. Do you think Slaveowners in 1860 Georgia refered to their uppity slaves as "Cowards"? I don't think they were quite as stupid as these academia twits.

  4. Sooo - People who don't want to be stolen from are "Cowards"....

    Mugger: Give me your wallet.
    Me: No.
    Mugger: You are a Coward.

    These "economists" have the character of little children. Seriously.

  5. Isn't tyler cowen a real business cycle guy? How the heck does he square his call for mass inflation with RBC, in which recession is supposed to be an efficient condition?

  6. Chris P Because really our friend Tyler is the coward since Austrian economics involves telling the DC crowd to drop dead and Tyler can't bring himself to do that.

  7. Anonymous @ 6:54 PM said, "This shows what frauds most "libertarians" not related to the Mises institute really are. To hell with them."

    I'll second that. ... the sell-outs.

  8. It's a good thing the voters hate inflation. We just need to reach the voters and convince them that the government purposefully dilutes the currency and takes on unpayable debt as alleged cures for economic problems. I'm convinced that voters just don't yet understand that this is the reigning economic theory and that it is perpetuated by a bunch of clowns called Keynesians. However, the complete lack of discussion of more "stimulus" at this time suggests that the voters don't buy Keynesian explanations at all.

  9. Ah, I should have read EPJ today before blogging. You beat me to the punch by several hours.

  10. You know, you see groups with certain leanings finding that the name they use to describe themselves is being co-opted and dilluted over time until it means something entirely different. The word "liberal" is an example.

    You see institutions that are meant to protect liberties being slowly infested - mission creep - by people who subvert them so they will start ordering people around.

    I have no doubt that as libertarianism grows in popularity, every hack or fraud and his uncle who secretly detests what it stands for is looking to see some of their numbers infiltrate such a 'movement' and subvert it from within until the word doesn't mean s**t anymore.

    And if they truly think they are libertarians honestly, it is merely because they happen to prefer *moderately* more freedom than the current state is willing to give, while understanding NOTHING about the core principles on which libertarianism is based. They are utilitarians and sometimes not even really that.

    Types like Cowen would probably be considered heroes by people like this:

    You know, statists who pay lip service to freedom while simultaneously begging for acceptance by the establishment.

  11. Cowen, IIRC from a Cato Unbound discussion, is a proponent of positive rights, i.e., of government. He may have many good qualities but being a libertarian isn't one of them.

  12. So, because of the cowardly people the dollar has lost only 98 percent of its value since 1912.

    Just imagine how much better off we would all be if we weren't so damn cowardly and could get the dollar to lose 99.8 or 99.98 percent of its value!

    John Law lives!

  13. I'm just wondering why it took some people so long to figure out that Cowen isn't a libertarian. I has been pretty obvious for a long time.

    He's not much of an economist, either, if he has fallen under Sumner's spell. Sumner is a one-trick pony. He knows ngdp targeting and nothing else.

    But how is ngdp targeting any different from inflation targeting with respect to long and variable lags? Greenspan said recently that the Fed's own models show the lag to be about 3 years.

    Sumner claims he can ignore the lags because expectations will impact behavior instantly. OK, Sumner, where's your evidence? He finds it in the financial markets. The stock and bond markets react instantly to Fed decisions. So what? It still takes three years for the stock and bond market reactions to filter down to the real economy.

  14. PS, why does Cowen think that voters hate inflation? Does he think they're irrational?

    Voters hate inflation because it makes them poorer and they know it!

    And Cowen calls himself an economist?!!

  15. Those who want to enslave the masses further are "Bold" and those who don't want to be slaves are "Cowards"...This is what University/Mass Media indoctrinators are told to state.

  16. One must suppose that an injection of inflation, if done directly as cash into every citizen's wallet, would not engender voter enmity, and probably would've been better for the economy than TARP and the various QEs. I don't suppose this is what Dr. Cowen suggested, however.

  17. The comments on Cowen's article are soul draining. Beyond blind acceptance of his assertion that it was "too bad" that the State's mass theft wasn't even more massive, the commenters are debating the finer points of 'shovel-ready-jobs' without a hint of irony. They're playing tug-of-war between two sides of the same fallacy.

    And predictably, the wonks are squealing that the economy hasn't recovered because we 'cowards' didn't let them spend enough ("Only a few more TRILLION this time! Really, I swear!"), but did Cowen really have to go so far as heralding Sumner a "prophet of our times"? Maybe inflation is raising the bar for entry into the hot tub.