Sunday, April 13, 2008
Say's Law
Isn't it sad to see our elected officials falling all over themselves, trying to be the first to "fix" the economy in this election year?.
When I read articles like this, I think about the education of our children. Shouldn't they be taught some mix of history and economics that would prevent them from being fooled into thinking that the government can actually fix things?...
When I read articles like this, I think about the education of our children. Shouldn't they be taught some mix of history and economics that would prevent them from being fooled into thinking that the government can actually fix things?...
In the Wall Street Journal, George Melloan discusses the issue:
"Say hello to that old ghost from the past we thought banished by Ronald Reagan in the 1980s. It's called 'Keynesian Economics.'
Ironically, even the brilliant John Maynard Keynes disowned it. After meeting with a group of Washington 'Keynesians' in 1944, he said he was the only non-Keynesian in the room. His brainchild, government spending to stimulate demand, had been converted from its originally intended limited application to an all-purpose economic panacea by politicians, academics and journalists.
The fundamental principle of the Keynesians, one that Lord Keynes would have scoffed at, is that government can deliver something for nothing. To be sure, government does transfer income and wealth to favored constituencies, such as rice farmers or ethanol producers, from people who pay taxes. Washington calls that economic stimulus."
