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Funny that. Not exactly surprising. How many years will it take to debunk Friedman I wonder? Or at least to fall from fashion. It's a pity Bretton Woods only l

Funny that. Not exactly surprising. How many years will it take to debunk Friedman I wonder? Or at least to fall from fashion. It's a pity Bretton Woods only let the world try a watered down version of Keynes.

Diederich 9y ago
If you have a few minutes, I wonder if you could translate these proper names, and what you're saying here, for the non-economists out here? (: I've seen Keynes mentioned here and on reddit with some frequency, but that's about it. Thanks.
- oldcynic 9y ago
  I'll try - it's a huge topic, and I'm only an interested amateur! [This will be too condensed and no doubt inaccurate in many places.] Keynes was a famous British economist who advocated saving a proportion of income during a surplus and using it to smooth out the worst of a downturn. In short he was in favour of intervention, but on the back of saving some during times of surplus. What's taken for Keynesianism today is usually just the spending on infrastructure during a downturn. Which is what he advocated at the height of the great depression after years of failed austerity. Crucially, perhaps, he didn't advocate intervention in every case. He was highly critical of the UK govt austerity response to the Great Depression. That criticism led to communications with Roosevelt and they met at the height of the depression. The build up to war turned out to be the largest test of "Keynesian" ideas rather than policies. Toward the end of the war Bretton Woods was an agreement of the major nations to set rules for trade and finance. The USSR attended too but declined to ratify. It led to the formation of the IMF, and World Bank. I say watered down as the Keynesian vision was to provide incentives to return to mean for both surplus and deficit countries. What we got put the responsibility on the deficit country only as a result of American pressure. Keynes was overruled by the US representative Harry White on many points, but later events often proved him correct. Keynes died in 1946. Interestingly Harry White turned out to have been a Soviet agent from at least mid-war on. Milton Friedman, Fredreich Hayek and the Chicago School of economics, believed in the free market and a hands off approach. He was an adviser to both Thatcher and Reagan. His ideas are more of the "let the market sort it out". What we got under Thatcherism and Reaganism is not a fair reflection of Chicago School ideas either as Hayek was quite comfortable with the idea of a welfare state and healthcare. They also seemed comfortable with strong regulation to ensure the fairness of the market. That seems somewhat at odds with the government policies that resulted "in their name". Friedman was a US academic at the University of Chicago who, along with Hayek, was part of the Chicago School of economics. A little known fact, thanks to the association with Thatcherism/Reaganism, is Friedman advocated a negative income tax to give all citizens a basic minimum income! There does seem to be, to me, to be too much of a mission against Socialism especially in Hayek he hammers the point so often that it really detracts from his point. Keynes, however, was certainly not a Socialist. Aside: it was Keynes who nominated Hayek for membership of the Royal Academy. TL;DR We've seen a partial implementation of both schools of thought but neither completely or accurately.
jackhack 9y ago
As a student of the Austrian economics model, I say thank God Keynes' heavy intervention model was never fully adopted. Meddling in markets makes for more volatile reactions when the markets finally correct -- and they always do. market forces are intrinsic and can only be ignored (or papered over) for so long. https://seekingalpha.com/article/2826066-keynesian-vs-austrian-economics https://seekingalpha.com/article/2826066-keynesian-vs-austri... Bonus topic: For those who are not aware, the Federal Reserve is not a branch of government. It is a cabal of international banks, formed in a secret meeting of world banking leaders travelling under false names, at Jekyll Island, South Carolina, and voted on in a christmas-eve session of congress in 1913 when many members had already left for home (so a majority was easier to achieve). They are absorbing the wealth of the world through inflation. Andrew Jackson was right -- a den of vipers and thieves, indeed. https://en.wikiquote.org/wiki/Andrew_Jackson https://en.wikiquote.org/wiki/Andrew_Jackson
- oldcynic 9y ago
  Austerity and letting the markets get on with it is far from always successful. Look at the UK's economy since '08. It didn't get us out of the Great Depression either. Agree more fully on your den of vipers topic - but that rather reinforces that markets are not fully free or fair. Homo Economicus is, after all, very different from Homo Sapiens. :)

Diederich 9y ago

If you have a few minutes, I wonder if you could translate these proper names, and what you're saying here, for the non-economists out here? (: I've seen Keynes mentioned here and on reddit with some frequency, but that's about it. Thanks.

oldcynic 9y ago
I'll try - it's a huge topic, and I'm only an interested amateur! [This will be too condensed and no doubt inaccurate in many places.] Keynes was a famous British economist who advocated saving a proportion of income during a surplus and using it to smooth out the worst of a downturn. In short he was in favour of intervention, but on the back of saving some during times of surplus. What's taken for Keynesianism today is usually just the spending on infrastructure during a downturn. Which is what he advocated at the height of the great depression after years of failed austerity. Crucially, perhaps, he didn't advocate intervention in every case. He was highly critical of the UK govt austerity response to the Great Depression. That criticism led to communications with Roosevelt and they met at the height of the depression. The build up to war turned out to be the largest test of "Keynesian" ideas rather than policies. Toward the end of the war Bretton Woods was an agreement of the major nations to set rules for trade and finance. The USSR attended too but declined to ratify. It led to the formation of the IMF, and World Bank. I say watered down as the Keynesian vision was to provide incentives to return to mean for both surplus and deficit countries. What we got put the responsibility on the deficit country only as a result of American pressure. Keynes was overruled by the US representative Harry White on many points, but later events often proved him correct. Keynes died in 1946. Interestingly Harry White turned out to have been a Soviet agent from at least mid-war on. Milton Friedman, Fredreich Hayek and the Chicago School of economics, believed in the free market and a hands off approach. He was an adviser to both Thatcher and Reagan. His ideas are more of the "let the market sort it out". What we got under Thatcherism and Reaganism is not a fair reflection of Chicago School ideas either as Hayek was quite comfortable with the idea of a welfare state and healthcare. They also seemed comfortable with strong regulation to ensure the fairness of the market. That seems somewhat at odds with the government policies that resulted "in their name". Friedman was a US academic at the University of Chicago who, along with Hayek, was part of the Chicago School of economics. A little known fact, thanks to the association with Thatcherism/Reaganism, is Friedman advocated a negative income tax to give all citizens a basic minimum income! There does seem to be, to me, to be too much of a mission against Socialism especially in Hayek he hammers the point so often that it really detracts from his point. Keynes, however, was certainly not a Socialist. Aside: it was Keynes who nominated Hayek for membership of the Royal Academy. TL;DR We've seen a partial implementation of both schools of thought but neither completely or accurately.

jackhack 9y ago

As a student of the Austrian economics model, I say thank God Keynes' heavy intervention model was never fully adopted. Meddling in markets makes for more volatile reactions when the markets finally correct -- and they always do. market forces are intrinsic and can only be ignored (or papered over) for so long. https://seekingalpha.com/article/2826066-keynesian-vs-austrian-economics https://seekingalpha.com/article/2826066-keynesian-vs-austri... Bonus topic: For those who are not aware, the Federal Reserve is not a branch of government. It is a cabal of international banks, formed in a secret meeting of world banking leaders travelling under false names, at Jekyll Island, South Carolina, and voted on in a christmas-eve session of congress in 1913 when many members had already left for home (so a majority was easier to achieve). They are absorbing the wealth of the world through inflation. Andrew Jackson was right -- a den of vipers and thieves, indeed. https://en.wikiquote.org/wiki/Andrew_Jackson https://en.wikiquote.org/wiki/Andrew_Jackson

oldcynic 9y ago
Austerity and letting the markets get on with it is far from always successful. Look at the UK's economy since '08. It didn't get us out of the Great Depression either. Agree more fully on your den of vipers topic - but that rather reinforces that markets are not fully free or fair. Homo Economicus is, after all, very different from Homo Sapiens. :)