Let us clear from the ground the metaphysical or general principles upon which, from time to time, laissez-faire has be founded. It is not true that individuals possess a prescriptive “natural liberty” in their economic activities. […] Nor is it true that self-interest generally is enlightened; more often individuals acting separately to promote their own ends are too ignorant or too weak to even attain these.
—  John Maynard Keynes, The End of Laissez-Faire (1926)

anonymous said:

I think you're great, but your view of economics is so twisted, it makes me sick. This experiment with Keynesian economics and central planning has sent the country trillions of dollars into debt. And you think handouts will help this? People respond to incentives, so why would people contribute to society when they can get things for free? And the minimum wage? I hoped you'd be smart enough to realize how horrible it is for low-skilled workers.

It was nice to receive this ask because the rest of tumblr thinks I am such a proletariat-hating capitalist. 

But anyway:

1. The question of whether a minimum wage is bad for low-skilled workers is far from settled, and anyone who claims that it is either unambiguously good or bad just hasn’t done much reading on the topic.

2. Why would people contribute to society when they can get things for free? Well, people are slightly more complicated than you’re giving them credit for, but no matter. Welfare is not a rational alternative to work in the United States or anywhere else in the industrialized world, and instituting a minimum income would not make it a rational alternative to work, because those checks would go to people who have jobs as well as those who don’t.

3. Just as a general point, I think there is a habit among a lot of people (myself included) to take one economics class in college and think that we are experts, but generally it’s better just to do some research and understand that even economists who do this stuff for a living disagree all the time. Economics is not a science like other sciences: No one is definitively right. (That said, Keynes came out of the Great Recession looking pretty damned good, even according to his detractors.)

Economics Joke

Keynes and Krugman are walking. Keynes says, “I’ll pay you $5,000 to eat a dog turd.” Krugman does it. Keynes doesn’t have any evil savings and didn’t think Krugman would do it: The next day he begs for the money back. Krugman says, “I’ll give it back if you eat a turd.” Keynes does it. Krugman says, “That was stupid: No one made money and we’ve both eaten sh*t.” Keynes says: “But we boosted GDP by $10,000.”

Watch on man-hastam.tumblr.com

omg please watch this. this girl was my roommate during the FEE (Foundation for Economic Education) seminar i attended over the summer.

Watch on garethalteran.tumblr.com

'Fear the Boom & Bust' : Hayek vs Keynes rap anthem.

Watch on moralanarchism.tumblr.com
Fight of the Century: Keynes vs. Hayek Round Two

Whenever I see this come up on tumblr or on my youtube feed I always have to watch it.

If there is no change in the propensity to consume, employment cannot increase… The economic system may find itself in stable equilibrium [though not necessarily a socially desirable one] with N [volume of employment] at a level below full employment, namely at the level given by the intersection of the aggregate demand function with the aggregate supply function.
—  John Maynard Keynes, The General Theory of Employment, Interest and Money
Recovery: A question of Supply or Demand

“The way out of this circle is to recognize that we only have the power to consume if we have produced and sold something in order to acquire the means to engage in consumption.  Starting the analysis with consumption assumes one has already acquired means.  Contrary to that analysis, wealth is created through acts of production that rearrange resources in ways people value more than alternative arrangements. These acts are financed with savings that come from households refraining from consumption.

If we want real stimulus, we need to free up producers by creating a more hospitable environment for production and not penalize the saving that finances them.”

I am not an expert, by no means on this issue. All I have to go by are my personal beliefs and my self-educated efforts and research. I do believe, however, that a supply sided plan will help recover the economy when compared to a consumption sided plan. Look at most “Stimulus” projects, they spend billions with little effect. Now compared the those outcomes to the rare times we have followed a supply sided recovery and we can see the effects of supply driven policies lead us out of recovery faster. Like I said though, just my opinion and not an export on the issue. 

Source: http://www.thefreemanonline.org/headline/consumerism-is-keynesianism/

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