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“JUNE 26, 2010
The Keynesian Dead End
Spending our way to prosperity is going out of style.

“Today's G-20 meeting has been advertised as a showdown between the U.S. and Europe over more spending "stimulus," and so it is. But the larger story is the end of the neo-Keynesian economic moment, and perhaps the start of a healthier policy turn.”

Many people are writing articles on Keynesianism without understanding economics, or Keynes.

The linked article is interesting, mostly for the lack of understanding of Keynes.

There is, at the heart of the situation, much confusion between money and work. In fact, several confusions.

Keynes was a pragmatist, not a dogmatist.

Before real progress is made, you first have to decide just what you wish to achieve.

The approach of Obama or Brown the Clown is clearly ludicrous. Not even a donkey would be able to stop guffawing at the notion of “spending our way to prosperity”. Certainly Keynes would never have fallen for such nonsense.

managing employment

Do you want more work? Then bury bottles with money in and pay people to dig them up, as Keynes advised in satire.

Do you want the unemployed to have money to spend? Then give it to them for free and stop the pretence.

Do you want some work done that the lazy shirkers will not do? Then try Hitler’s approach - point guns at them.

Alternatively, with more sense, make the handouts dependent on the recipients doing the jobs you want done. Of course, the unions will not like what they will then call cheap labour.

But do not become muddled between these various objectives.

Now what if you have no work you want done? Then, if you want to be Nero or a pharaoh, and believe the unemployed should be kept busy and out of trouble, you bury bottles or build pyramids, or even motorways. But but but .... what you most definitely do not do is use huge modern machinery. You issue the ‘workers’ with pickaxes, or even with tooth picks.

Returning to money. The money printing in the UK was sensibly used to wipe out debt and give the government banking system more tokens to play with. That bit has damn-all to do with work or ‘unemployment’. So don’t be confused!

related material
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the mechanics of inflation: The great government swindle and how it works

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cynical analysis of the eussr debt

2:35 mins

and the European economic madhouse grows...

“The big three credit ratings agencies were threatened yesterday with fines and the creation of a new state-backed competitor, only weeks after European leaders attacked them for exacerbating Greece’s problems with downgrades.

“The agencies will be subject to a new European supervisory body with the power to hand out fines and suspensions under plans unveiled in Brussels.”

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http://www.abelard.org/news/economics062010.php#eussr_debt_030610

poor old adam - working for the uk socialist state

From the TaxPayers’ Alliance:

1:59 min.

Burning our money’s Wat Tyler calculated that “our typical worker is still working for the government right up to 3.10pm (assumes 30 mins lunch break).”

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