8th January 2011
Keynes the incompetent economist
Apart from being a very devious and perverted person (see this blog post) who misrepresented other economists and took credit for things that others had done, he was simply wrong. He was a VERY BAD ECONOMIST.
Indeed, after the Philips curve controversy in the 1970s, the resurgence of the Chicago school (Keynesians were operating primarily from Harvard and the London School of Economics), and Lucas's work on rational expectations that explored the micro-economic foundations of the economy, Keynes was basically dumped from most advanced course work in the major universities.
But he seems to re-emerge from the corners in the kitchen, just like a cockroach comes out when the house owner (government in this case, with the GFC) makes a mess.
Nevertheless it is important that we continue to disprove the theses of these failed economists. Marx's theses must be disproved because the academia continues to be full of old fogies who blindly teach Marx. Similarly there are Keynesians across the world, particularly in the government, whose ideas must be disproved, since they will revert to bad form at the slightest opportunity ("opportunity" that they would have created themselves through bad policy). The fight for freedom is not easy. It can only be won if its detractors are continuously challenged, else their ghosts will emerge in each generation to haunt us.
And so it is important that we continue to disprove Keynes's theses.
In the meanwhile, below is a short video by Hayek (on Keynes) and an extract from Murray Rothbard – to keep you thinking, and to prove that Keynes was basically incompetent as an economist. I'll put out more stuff in the coming days/weeks. My main task in the next two days is to finish my next article for Freedom First.
(Btw, through the link provided inside this video – on Youtube – I've discovered a treasure trove with leads to many interesting things. These days one thing leads to another, and yet another. These are the times when mankind's ignorance should dissipate rapidly – if only we put in the effort to acquire the knowledge we need to ensure our freedom and prosperity).
Hayek on Keynes
- Bruce Caldwell's "Why Didn't Hayek Review Keynes's General Theory?" for many more insights.
- F. H. Knight, "Unemployment: And Mr. Keynes's Revolution in Economic Theory", The Canadian Journal of Economics and Political Science, Vol. 3, No. 1 (Feb., 1937), pp. 100-123 [JSTOR]
- "Hayek on Keynes" – a blog post by Don Bourdeaux.
- Y = C+I+G+(X-M)