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Source link: http://archive.mises.org/14140/blind-to-the-flaws-of-keynesianism/

Blind to the Flaws of Keynesianism

October 4, 2010 by

Blinder is arguing that of course the Obama stimulus worked, because spending money creates jobs, period. To see just how naive this view is, consider that there is nothing in Blinder’s argument restricting it to cases of severe recession. FULL ARTICLE by Robert Murphy

{ 48 comments }

Ray Rock October 4, 2010 at 8:51 am

Is the Moody’s Analytics model of the economy the same model Moody’s used to determine that MBS, CDO’s and other subprime products merited AAA ratings during the housing bubble?

Stephon Smith October 4, 2010 at 9:40 am

Good question. I was wondered the same thing.

Troy Doering October 5, 2010 at 2:07 am

Great comment, how valid is a computer model, if you have to tweak it to produce the wanted results?

Joe October 4, 2010 at 11:25 am

I love the models these elitists use. When I was reading this article I couldn’t help but see the similarities to the whole “Climate Change” models. As we all know garbage in garbage out. The sad thing is these people make lots of money for doing absolutely nothing.

Walt D. October 4, 2010 at 12:30 pm

And as with “Climate Change”, the major flaw is the disconnect with reality.
BTW If creating jobs was the only goal we could send the unemployed down to the local gym and connect their exercise bicycles into the electricity grid – “Green Keynesianism” – (marginally) better than digging useless holes in the ground and filling them in (what Obama calls “shovel ready jobs”). Robert Murphy has already blown a raspberry at this concept.

Sam Advanski October 4, 2010 at 11:45 am

blinder than Blinder?

The Emperor’s New Economics

This is a tale about the Exalted One’s economics, which the big money interests have sold him on. His advisors pretend to see what he proclaims (so as not to appear stupid), as do the public when he parades himself before them. Only a young bright-eyed Austrian sees right through him, noticing that there’s nothing behind what he proclaims.

Dennis October 4, 2010 at 12:04 pm

Seemingly, if each $100,000 of stimulus created/saved a job, but if the private sector can do that for $80,000, then taking $862 billion from the private sector should have resulted in . . . a loss of 2.1 million jobs!

Allen Weingarten October 5, 2010 at 3:29 am

Dennis, thanks for a clear & succinct approach that balances the gains and losses of interventionism.

Curt Howland October 4, 2010 at 12:16 pm

If only the Feds had simply taken all that money, divided it up per taxpayer, and mailed the checks out to everyone who paid taxes last year.

The “rich” would benefit least, the “poor” benefit most, and the inflation would just happen and get it over with.

Oh, that’s right, it’s not about people. It’s about benefiting politically well connected individuals and firms.

Silas Barta October 4, 2010 at 1:10 pm

It’s pretty depressing that such respected economists still produce this kind of work. If I understand the situation correctly, this Blinder analysis — published *after* the wake of the stimulus — does not incorporate any of the empirical data from the stimulus! So, it really says nothing more than, “here are our assumptions.” Contrary to what you would expect, the model doesn’t have anything that says, “if these economic numbers are in this range at this time, that tells us the stimulus didn’t work [for all meaningful definitions of 'work']“.

So the model is completely insensitive to the data, and yet statisticians aren’t prominently screaming bloody murder about this. Whatever you might say about Austrian economists, at least they openly admit it when they do a-priori theorizing…

Inquisitor October 4, 2010 at 7:49 pm

Because the data is in need of interpretation. Though you’re right, it’s quite embarrassing when you consider the approach to the science the neoclassicals and Keynesians allegedly take.

J. Murray October 4, 2010 at 1:25 pm

GDP = C + I + G + (X-I)

It’s a simple mathematical property, if one side of this equation increases, so will the other.

But Economics isn’t a hard science. It isn’t like knowing that if I have 1 part hydrochloric acid and 2 parts sodium-hydroxide that I’ll need another 1 part hydrochloric acid to balance out the equation to make a perfectly neutral salt water.

Sure, increasing G will increase GDP. It’s built right there in the formula. The real question is does the formula make any sense? There needs to be some other indicator of how well an economic system is doing, one where G is completely segregated and not part of the system at all, to see if increasing G actually does any good. The formula needs to be able to identify individual prosperity because that’s all an economy is supposed to do, improve prosperity of the individuals living in it.

This is the basic flaw of Keynesian economics, the obsession with GDP, which was just made up by Kenesians without any kind of serious study to see if it made any sense. It was just assumed to work and it’s run with. The ultimate problem is that GDP doesn’t fit up with anything useful and is just some random number. If mathematics is a language, then GDP is babbling gibberish.

BioTube October 4, 2010 at 8:52 pm

Your comparison to chemistry’s more apt than you realize: it’s just as easy to create a balanced reaction that’s physically impossible as it is to write up a meaningless econometric equation.

Lord Keynes October 4, 2010 at 9:54 pm

You say:

The ultimate problem is that GDP doesn’t fit up with anything useful and is just some random number.

The claim that “GDP doesn’t fit up with anything useful ” is utterly false:

http://socialdemocracy21stcentury.blogspot.com/2010/07/is-gdp-meaningless.html

GDP has very meaningful parts.

Daniel October 4, 2010 at 10:28 pm

No. It’s just useless aggregation.

If everyone started taking out their savings to invest in the production of, let’s say, burnt matchsticks, we’d see a great increase in GDP (the I in the formula), and even an increase in employment.

However, since an investment is made with an expectation of return in the future, and this burnt matchstick enterprise produces something incredibly useless, interpreting the increase GDP as “a good thing” would be a great folly, not to say outright stupid.

In conclusion: C + I + G – (X – i) = baloney

PS: considering government expenditure “exogenous” is absurd.

PPS: you still haven’t refuted Say’s Law

Lord Keynes October 4, 2010 at 11:15 pm

If everyone started taking out their savings to invest in the production of, let’s say, burnt matchsticks,

You have no proof that government spending did not cause activity and investment of benefit to the US.
Referring to “burnt matchsticks” as if government spending was the equivalent of that is a reductio ad absurdum fallacy.

htran October 5, 2010 at 12:00 am

“Burnt matchsticks” isn’t too far off: http://caps.fool.com/blogs/100-worst-stimulus-projects/428539

Government deficit spending is always going to rob the public of value because of inflation. The result will be negative net job creation in the private sector, or worse, malinvestment that leads to the next bust. You can’t argue that the stimulus “saved” the economy is this regard.

I guess you could argue that if the private sector isn’t creating jobs, the government can force the market to create inferior jobs by deficit spending. But as you can see by the anemic growth, the stimulus is a failure.

Lord Keynes October 5, 2010 at 12:37 am

Government deficit spending is always going to rob the public of value because of inflation.

That is nonsense. If deficits are funded by borrowing money from the private sector, then the money spent is equal to money borrowed. The quantity theory of money is invalid in a recession:

http://socialdemocracy21stcentury.blogspot.com/2010/07/quantity-theory-of-money-critique.html

The Austrian theory of inflation is debunked here:

http://socialdemocracy21stcentury.blogspot.com/2010/04/austrian-theory-of-inflation-myths-and.html

And even if the private sector suddenly started investing that would cause inflationary forces too.

The result will be negative net job creation in the private sector, or worse, malinvestment that leads to the next bust.

All totally unproven assertions. On what are they based. Praxeology? If so, utterly unconvincing:

http://socialdemocracy21stcentury.blogspot.com/2010/10/mises-praxeology-critique.html

You say: But as you can see by the anemic growth, the stimulus is a failure.

There was nothing “anemic” about the growth caused by the stimulus. It pulled the economy out of the hole it was in:

2009 Q4 5.00%

2010 Q1 3.70%

http://www.tradingeconomics.com/Economics/GDP-Growth.aspx?Symbol=USD

Inquisitor October 5, 2010 at 5:01 am

Please look up Geoffrey A. Plauche’s paper on the Austrian method. He pretty much outlines in a consistent manner an aprioristic framework for the Austrian school without falling prey to the weaknesses of Kantianism and which is immune to your “criticisms”. Also, the fact that there are more than one praxeological schools of economics does not thereby imply the others are correct, and could easily be said of “positivist” economics too. You’ve composed a very long paper which says very little of merit in effect. The paper just contains strings of references that themselves are pure assertions (like Austrianism apparently “stagnating” – because Paqué says so?) Some of the arguments in your paper are so mind-boggingly idiotic (like the one on internal revisions) that I cannot understand how you could even make them. Praxeology is fallibilistic, so your “refutation” is just pointing out the obvious. You basically don’t “critique” so much as providing strings of assertions, and mentioning alternate epistemologies used to frame praxeology. Then there are gems like this:

“It is clear from all this that Mises’ praxeology does in fact have severe flaws in its verbal chain of logic and argumentation. When unreal or false subsidiary hypotheses are used in an a priori argument, the resulting inferences do not describe the world in which we actually live. That is, any conclusions that are necessarily drawn by deduction will only be true of the imaginary world where one’s subsidiary hypotheses are hypothetically true. But that imaginary world is not the real world we know and live in. It is a fantasy world.”

Sure… but where have you demonstrated any of them to be false? Then there’s the bit on how do we choose between alternate praxeological systems? By the method Mises outlined, perhaps, considering his apriorism was… fallibilistic? Which of multiple positivist models concerning the same data set does one pick out? This reads like a poorly researched, horribly compiled, amateurish paper on epistemology. Mises’s Kantian method did bear improvement and has been through GAP’s paper, but your own paper is just a collection of opinions by certain people, to be brutally honest. There are some good points made in it regarding subsidiary assumptions (by OTHER thinkers, not you) but these highlight flaws in the Kantian system more than praxeology, and placing it back in its neo-Aristotelian roots resolves many of them.

Nor have you “debunked” any Austrian theory of inflation seeing as you are just bitching about some Austrians being at odds with Mises…

“That is nonsense. If deficits are funded by borrowing money from the private sector, then the money spent is equal to money borrowed. The quantity theory of money is invalid in a recession:”

Which will increase borrowing costs to the private sector and deprive it of funds…

“There was nothing “anemic” about the growth caused by the stimulus. It pulled the economy out of the hole it was in:

2009 Q4 5.00%

2010 Q1 3.70%”

Why are these metrics interesting?

This has to be one of the dumbest, most ignorant posts I’ve seen here yet. And you have tough competition in that regard.

Inquisitor October 5, 2010 at 4:47 am

More to the point, you have no proof that it -did- do so. And there are very, very good reasons to think it didn’t.

Inquisitor October 5, 2010 at 5:04 am

And you’ve still not shown GDP is useful as an aggregation in any way whatsoever…

Lord Keynes October 5, 2010 at 5:45 pm

The paper just contains strings of references that themselves are pure assertions
Nope, it is assertion backed up by evidence and argument. You statement here:

your own paper is just a collection of opinions by certain people, to be brutally honest. There are some good points made in it regarding subsidiary assumptions (by OTHER thinkers, not you)

is laughable. I have plenty of personal judgements and arguments in the post, and there is nothing problematic about doing one’s research and carefully citing specialist literature – it’s called academic research.
The fact the OTHER people have debunked Mises’ praxeology is true, but the use and citation of their work is entirely what a good scholar would do.

Sure… but where have you demonstrated any of them to be false?

An obvious one is Mises’ argument for free trade. As is well known, it depends on assumptions that do not hold in real world, such as:

(1) capital is not internationally mobile;
(2) domestic factors will be re-employed in the sector/sectors in which the country’s comparative advantage lies;
(3) workers can be re-trained easily.

Which will increase borrowing costs to the private sector and deprive it of funds…
No it won’t. You Austrians complain repeatedly about fiat money and how the central bank has the power to create money from nothing.
In a fiat money system, open market operations and, more particularly, quantitative easing have flooded the financial system with liquidity. The interest rates are record lows.
There is NO problem with funds for private sector borrowing.
How can anyone possibly believe that deficits “will increase borrowing costs to the private sector and deprive it of funds.”
When?? A year? 2 years??

Inquisitor October 5, 2010 at 8:32 pm

“Nope, it is assertion backed up by evidence and argument.”

No, just assertion.

” I have plenty of personal judgements and arguments in the post, and there is nothing problematic about doing one’s research and carefully citing specialist literature – it’s called academic research.”

It’s a string of citations with commentary interspersed here and there.

“The fact the OTHER people have debunked Mises’ praxeology is true, but the use and citation of their work is entirely what a good scholar would do.”

Yet none of the authors you’ve cited have marshalled any arguments that actually succeed in “debunking” it, usually because they’ve no idea what the praxeological method entails.

“An obvious one is Mises’ argument for free trade. As is well known, it depends on assumptions that do not hold in real world, such as:

(1) capital is not internationally mobile;
(2) domestic factors will be re-employed in the sector/sectors in which the country’s comparative advantage lies;
(3) workers can be re-trained easily.”

Show where he requires -any- of these assumptions to hold. This sounds far more like the neoclassical argument for free trade, not the Misesian one based on the law of comparative advantage/the law of association. Mises’s argument is an extension of his argument for trade between individuals. Please show me why trades deemed mutually beneficial when transpiring between individuals magically cease to be when they cross national “borders” and please do not try cloak it in garbage like the foregoing.

“No it won’t.”

Prove it.

” You Austrians complain repeatedly about fiat money and how the central bank has the power to create money from nothing.
In a fiat money system, open market operations and, more particularly, quantitative easing have flooded the financial system with liquidity. The interest rates are record lows.
There is NO problem with funds for private sector borrowing.”

Yeah, and this is the WORST approach of the lot because it induces malinvestments and is an “invisible” tax on the late-receivers of the new funds. Are you Keynesians born stupid?

Lord Keynes October 5, 2010 at 9:58 pm

Yeah, and this is the WORST approach of the lot because etc…

It appears you have conceded that your assertion that deficits “will increase borrowing costs to the private sector and deprive it of funds” is a synthetic proposition TOTALLY falsified by empirical evidence, since you have suddenly slyly shifted your argument to the Austrian business cycle theory.

The belief that there is an “‘invisible’ tax on the late-receivers of the new funds” applies to private debt too in fractional reserve banking. Maybe you oppose fractional reserve banking? In which case your position is totally demolished here:

http://socialdemocracy21stcentury.blogspot.com/2010/06/fractional-reserve-banking-evil.html

Inquisitor October 6, 2010 at 7:27 am

“It appears you have conceded that your assertion that deficits “will increase borrowing costs to the private sector and deprive it of funds” is a synthetic proposition TOTALLY falsified by empirical evidence, since you have suddenly slyly shifted your argument to the Austrian business cycle theory.”

Conceded what? You brought up an entirely different means of monetary expansion with its own attendant flaws. If the amount of money remains fixed, government borrowing will crowd out private investment. You then subsequently shifted to credit expansion.

“The belief that there is an “‘invisible’ tax on the late-receivers of the new funds” applies to private debt too in fractional reserve banking. Maybe you oppose fractional reserve banking? In which case your position is totally demolished here”

*yawn* Where was this supposed “demolition”? The reason it does not apply to private debt is because unlike FRB currencies, private currencies are not legal tender, so if an individual does not wish to use them they can switch. I’m not going to bother with more of your articles, so if you’ve points to make do so here in summary form. So far you’ve offered no real arguments.

Lord Keynes October 6, 2010 at 8:30 pm

Conceded what?

That Obama’s deficits have NOT increased borrowing costs to the private sector and deprived it of funds.

Interest rates are historically low:

http://www.mybudget360.com/wp-content/uploads/2010/03/fed-funds-rate.png

http://www.ritholtz.com/blog/2009/05/us-interest-rates-since-1950s/

Excess reserves expanding the stock of loanable funds have soared:

http://www.aleablog.com/a/hc_014.png

Do you dispute these simple facts? If not, your view is utterly destroyed.

Inquisitor October 7, 2010 at 6:49 am

“That Obama’s deficits have NOT increased borrowing costs to the private sector and deprived it of funds.

Interest rates are historically low:

http://www.mybudget360.com/wp-content/uploads/2010/03/fed-funds-rate.png

http://www.ritholtz.com/blog/2009/05/us-interest-rates-since-1950s/

Excess reserves expanding the stock of loanable funds have soared:

http://www.aleablog.com/a/hc_014.png

Do you dispute these simple facts? If not, your view is utterly destroyed.”

…I’m beginning to think you’re a rather silly troll. If the money is created out of thin air the results are even worse than when it is not. So what is it I have “conceded”? You presented two different scenarios. In the one, government borrowing will absolutely crowd out private investment. In the other, credit expansion will cause further malinvestments and halt corrections. So how do these “simple facts” outlining government idiocy “destroy” my view?

J. Murray October 7, 2010 at 6:56 am

Considering usury laws prohibit interest rates to be raised beyond a certain percentage above the Federal Reserve rate, quoting record low interest rates is meaningless. They’re at a record low because government arbitrarily set them at a record low. The real problem is that no one is getting those record low rates because banks aren’t lending to businesses. As such, the business interest rate is effectively infinity as they cannot get a loan at all.

Lord Keynes October 7, 2010 at 11:54 pm

If the money is created out of thin air the results are even worse than when it is not.

The Austrian business cycle theory was destroyed by Sraffa and Kaldor years ago.
Hayek petty much gave up business cycle theory and turned to other subjects after this take-down.
By the way, your assertion that crowding out is occurring when QE has been done is a blatant contradiction.

Franklin October 4, 2010 at 1:29 pm

“Alan Blinder is a distinguished Princeton economist….”
Why would he be distinguished if, in only a few paragraphs, Mr. Murphy shreds the professor’s hypothesis, his faulty methods and, correctly yet with subtlety, exposes the argument as more statist sycophancy?

F. Beard October 4, 2010 at 2:24 pm

Fractional reserve lending creates money as loans are made and destroys it as loans are repaid. In the process it cheats savers of honest interest rates and drives borrowers into debt that is unservicable during the bust. The Keynesians realize the destructive nature of deflation and attempt to counter it with indirect and unjust methods (“stimulus”) and more debt. Many Austrians, OTOH, embrace deflation as GOOD even though it is just the flip side of the inflation caused by fractional reserve lending. In fact, deflation is NOT good either. ( Consider a barbed arrow that wounds if one attempts to pull it out.)

There is another option based on the Bible, debt forgiveness (Deuteronomy 15, Leviticus 25). However since savers have been harmed too, then a general bailout of the population would be better.

I know you guys hate Lincoln but his debt-free Greenbacks (United States Notes) would enable the US Treasury to bailout the entire population. Everyone could be fixed in nominal terms including the banks and those who might suffer in relative terms are most likely to have been the villains anyway.

Andrew October 4, 2010 at 9:47 pm

Your arrow analogy is flawed. Stopping the printing presses and letting deflation take place would be good. An apt analogy would be a barbed arrow that just stopped short from hitting a heart or vital organ; pulling it out will cause further damage, but pushing it through will surely cause death.

The idea of “the government” bailing out everyone using the printing press is preposterous. If every human were magically granted $10,000, what would occur is a reduction in the value of $10,000– no one would be richer (except for the intrinsic value of new paper in their pockets).

Lincoln used his greenbacks to fuel mass murder. The Federal Reserve system does the same thing today. Both systems involve mass theft and are immoral (according to any Christian ethics I have ever been exposed to).

Dave Albin October 4, 2010 at 2:31 pm

You guys touched on this – economic “science” has no control group, so it really is not science at all. Praxeology treats it like medical case studies, which is at least correct for each particular case.

Stephon Smith October 4, 2010 at 2:50 pm

Good question. I wondered the same thing.

David October 4, 2010 at 3:14 pm

Yes if they’re so sure of their model why don’t they tell us what things will look like in a year or two.

Walt D. October 4, 2010 at 3:42 pm

A Keynesian Economist is somebody who will tell you tomorrow why what they forecast yesterday did not happen today.

Andrew October 4, 2010 at 9:48 pm

lol

Chris October 4, 2010 at 7:09 pm

That block quote about the $300 billion creating 3m new jobs is stunning. That is the type of analysis I would expect from a first year undergraduate. The fact that this guy is a professor at Princeton is breathtaking. I can’t imagine a more obvious example of propaganda.

Lord Keynes October 4, 2010 at 9:51 pm

Robert P. Murphy says:

“But if the model itself is completely bogus, then this ex post fine-tuning wouldn’t reveal the fact. In the Blinder and Zandi study, the “fact” that real GDP responds positively to government spending is built right into the model.”

There is no proof that Murphy’s “model” of the economy works at all. If it’s based on Misesian praxeology, it’s pretty much irrelevant to the real world:

http://socialdemocracy21stcentury.blogspot.com/2010/10/mises-praxeology-critique.html

Moreover, postdiction/retrodiction – and not just prediction – is an entirely valid approach if one accepts a Popperian methodology for one’s discipline.

Murphy also conveniently ignores the fact that a large number of Keynesian economists predicted that stimulus would bring the economy out of recession and that it would prevent a depression. They are vindicated.

Murphy asks:

After all, what would the world look like, if the stimulus had been a failure?

Easy. It would look much like the catastrophe in Ireland:

http://socialdemocracy21stcentury.blogspot.com/2010/09/irelands-sham-recovery-gnp-versus-gdp.html

In Ireland, the unemployment rate has soared from 4.3% (2007) to 13.8% (2010), which is a rise of 220.93% since 2007. In the US, by the more accurate estimate of John Williams of Shadowstats, the US unemployment rate rose from about 12% in 2007 to about 22% today, an increase of about 83.33%, which is bad, but not nearly as bad Ireland which had no stimulus.

Daniel October 4, 2010 at 10:32 pm

In Ireland, the unemployment rate has soared from 4.3% (2007) to 13.8% (2010), which is a rise of 220.93% since 2007. In the US, by the more accurate estimate of John Williams of Shadowstats, the US unemployment rate rose from about 12% in 2007 to about 22% today, an increase of about 83.33%, which is bad, but not nearly as bad Ireland which had no stimulus.

WTF is wrong with your brain?

Inquisitor October 5, 2010 at 5:09 am

“There is no proof that Murphy’s “model” of the economy works at all. If it’s based on Misesian praxeology, it’s pretty much irrelevant to the real world:”

Unproven assertion. Your paper sure as hell doesn’t prove it as outlined above, because you never once bother to show which of praxeology’s axioms or subsidiary axioms is false.

“Moreover, postdiction/retrodiction – and not just prediction – is an entirely valid approach if one accepts a Popperian methodology for one’s discipline.”

Why must one? But it doesn’t save the work mentioned from Murphy’s critique – it’s still using a model to prove a model correct.

“Murphy also conveniently ignores the fact that a large number of Keynesian economists predicted that stimulus would bring the economy out of recession and that it would prevent a depression. They are vindicated.”

Ipse dixit.

“Easy. It would look much like the catastrophe in Ireland:”

Prove it. Just linking alleged stats from Ireland will not prove that the recession was prevented from worsening due to the stimulus. Not only is Ireland a separate economy but also you need to provide theoretical reasons as to why one should expect a stimulus to do so. You need a comparison between the US with the stimulus and without it. But for this you will need to run simulations (and I am not conceding this is a valid methodology for economics) like the one critiqued in the paper. Which will have to be based on a correct model. Which you’ve not shown in the slightest.

Bob Murphy October 4, 2010 at 10:08 pm

Actually, the standard GDP equation does NOT say that “boosting G will boost Y.” That is a trick that the Keynesians use. According to the equation itself, boosting G could just as well lead to a fall in C or I.

I spell this stuff out in this article:
http://mises.org/daily/3945

(I think you guys are probably aware of this. I’m just trying to not concede more to the Keynesians than they deserve. The GDP equation is very misleading and lulls you into thinking G per se “boosts the economy,” but strictly speaking that’s not true.)

Brett in Manhattan October 4, 2010 at 11:46 pm

Murph,

I read this on Henry CK Liu’s page, but, I don’t quite have the economic chops to tackle his argument. What do you think?

“In recent decades, an intuitive myth has been pushed on the unsuspecting public by Supply Side economists that low taxes encourage corporations, employers and entrepreneurs to create high paying jobs. But the counterintuitive historical truth is that a progressive income tax regime with over 90% for top bracket incomes actually encouraged management and employers to raise wages. The principle behind this truth is that it is easier to be generous with the government’s money.

In the past, when top corporate income tax rate was at over 50% and personal income tax rate at over 90%, both management and employers had less incentive to maximize net income by cutting cost in the form of wages. Why give the government the money when it could be better spent keeping employees happy. “

Matthew Swaringen October 5, 2010 at 6:53 am

If employees are paid more nominally, why does that lead to a better standard of living when you are talking about the same amount of goods and services? This only serves to increase inflation in prices for those same goods and services.

The money is diverted away from purposes that business could have chosen such as expanding operations and production.

I’m also not really convinced that they would truly pay more, but it won’t have a real world effect because money isn’t magic. It doesn’t produce real wealth. Real savings and capital accumulation produces more wealth.

Troy Camplin October 5, 2010 at 1:49 pm

Here’s a few comments I made on Peter Smith’s takedown of Keynesianism:

http://zatavu.blogspot.com/2010/10/is-macroeconomics-nonsese.html

http://zatavu.blogspot.com/2010/10/economies-are-driven-by-supply.html

Keynesians literally have things backwards.

J.D. October 5, 2010 at 4:03 pm

Isn’t coming onto this site with the handle “Lord Keynes” and linking to a blog with “social democracy” in the title kinda like being a troll named Satan on a Christian message board?

The fact that Blinder’s from Princeton explains everything. It simply adds more confirmation to what I already know about arrogant, condescending, self-important, ivy league, academic intellectuals with a sense of superiority whose ego is invested in their academic credentials… They’re idiots.

Joe October 7, 2010 at 12:24 am

I think Lord Keynes is really Michael. I haven’t heard of him lately.

raspberryketoneplus July 29, 2011 at 7:15 am

The GDP equation is rather mis-leading and can be applied differently in different situations.

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