Keynes v Hayek (UPDATED)
VIRAL NOTES: Even though I hate, hate, hate rap music, this is a very entertaining video, and the production value is pretty damned good. It's also funny how they portrayed the bias against Hayek and the unthinking, uneducated, feel-good, knee-jerks that favor Keynesian 'economics'.
Anyhow:
IN THIS CORNER: FRIEDRICH HAYEK!
http://en.wikipedia.org/wiki/Friedrich_Hayek
AND IN THIS CORNER, JOHN MAYNARD KEYNES!
Naturally, I expect you know who I'm putting my money on.
It really bothers me, though, how people, in spite of mounting, mounting evidence, can continue to believe that Keynesian economics has any validity. Like the video states, the markets are not these circular, closed systems that just require a little agitation from the ham hand of Big Brother (government) to keep it fresh. The economy is an open system that we do not truly know the limits of, and is truly guided by the Invisible Hand (http://en.wikipedia.org/wiki/Invisible_hand).
When Keynesian economics is applied, money from government spending (http://michellemalkin.com/2009/02/12/here-it-is-all-1434-pages-of-the-porkulus-conference-report/) is thrown around, and wild claims are made that this will cure everything. Even liberal moguls like Buffet didn't really know if it would work (http://www.huffingtonpost.com/2009/01/24/warren-buffett-nobody-kno_n_160625.html), and, in the aftermath, we know it didn't even come close (http://www.thegreatilluminator.com/blog/?p=5221). Obama's stupid spending binge was like trying to start a tsunami with a fart in a swimming pool...
...or bathtub, in this case.
On the other hand, there's Hayek's wisdom. Government is meant to govern, and the business world is meant to run itself. When business is cut loose, this is when you see improvement. Had WW2 been followed by massive slashing of taxes, as well as the abolition of several forms of taxation (such as payroll tax, capital gains tax, progressive income taxation, in favor of a flat-fee tax, etc.)...
...then we really would've gotten to see what the best solution was. During WW2, we had government wealth redistribution and subsidies powering industry. If in the post WW2 era, we'd immediately broke the chains of over-regulation off industry and let it fend for itself, free to make profits, invest and expand, I think the differences would've been stark. When WW2 was over, a lot of people lost their jobs. Had they done it the Hayek way, a lot of people wouldn't've had to go through that, as business would've had the money to justify keeping a lot more people on the payroll.
UPDATE: VIRAL NOTES: I believe this may actually be the first (preceding) video:
Anyhow:
IN THIS CORNER: FRIEDRICH HAYEK!
http://en.wikipedia.org/wiki/Friedrich_Hayek
AND IN THIS CORNER, JOHN MAYNARD KEYNES!
Naturally, I expect you know who I'm putting my money on.
It really bothers me, though, how people, in spite of mounting, mounting evidence, can continue to believe that Keynesian economics has any validity. Like the video states, the markets are not these circular, closed systems that just require a little agitation from the ham hand of Big Brother (government) to keep it fresh. The economy is an open system that we do not truly know the limits of, and is truly guided by the Invisible Hand (http://en.wikipedia.org/wiki/Invisible_hand).
When Keynesian economics is applied, money from government spending (http://michellemalkin.com/2009/02/12/here-it-is-all-1434-pages-of-the-porkulus-conference-report/) is thrown around, and wild claims are made that this will cure everything. Even liberal moguls like Buffet didn't really know if it would work (http://www.huffingtonpost.com/2009/01/24/warren-buffett-nobody-kno_n_160625.html), and, in the aftermath, we know it didn't even come close (http://www.thegreatilluminator.com/blog/?p=5221). Obama's stupid spending binge was like trying to start a tsunami with a fart in a swimming pool...
Click to view...or bathtub, in this case.
On the other hand, there's Hayek's wisdom. Government is meant to govern, and the business world is meant to run itself. When business is cut loose, this is when you see improvement. Had WW2 been followed by massive slashing of taxes, as well as the abolition of several forms of taxation (such as payroll tax, capital gains tax, progressive income taxation, in favor of a flat-fee tax, etc.)...
...then we really would've gotten to see what the best solution was. During WW2, we had government wealth redistribution and subsidies powering industry. If in the post WW2 era, we'd immediately broke the chains of over-regulation off industry and let it fend for itself, free to make profits, invest and expand, I think the differences would've been stark. When WW2 was over, a lot of people lost their jobs. Had they done it the Hayek way, a lot of people wouldn't've had to go through that, as business would've had the money to justify keeping a lot more people on the payroll.
UPDATE: VIRAL NOTES: I believe this may actually be the first (preceding) video: