Thursday, April 28, 2011

Karl Smith and MattW agree on KvH2

My paraphrase of Smith: "I like that Hayek guy a lot, but I don't really recognize their Keynes - but I do know another guy named Keynes who, like Hayek, has some good ideas that are worth considering along with Hayek's."

MattW, a commenter on the Cafe Hayek post, writes: "I consider myself more Hayekian than Keynesian, but even I see that Keynes’ point of view is presented very poorly. This really bugs me in any arguments because it just makes my side look worse overall; setting up a weak version to argue against only works if you’re trying to convince people who don’t know anything about the argument."

I'm glad I'm not a complete voice in the wilderness on this one. I want to re-emphasize again - I love the video and am truly impressed with what John and Russ have put together. But if you call Keynes a central planner, you ought to expect a few "WTF!!!"s from across the aisle (not "win the future").


  1. The whole socialization-of-investment idea is pretty close to "central planner," just by the way.

  2. I thought this one was more partisan than the last also.

  3. Mattheus -
    I think reading that whole paragraph might lead someone to a different conclusion. He makes no bones about the fact that he is not talking about central planning.

    Gene -
    Yes, probably. I'd be curious to know more about your thoughts on it.

  4. This comment has been removed by a blog administrator.

  5. Remember the new comment policy people.

    If you compare Keynesianism to racism I'm just deleting it. I'm sick of this sort of crap and I like these comments to stay productive.

  6. Let's try this again with amendments which address concerns. No trigger warning needed.

    "For whilst it indicates the vital importance of establishing certain central controls in matters which are now left in the main to individual initiative, "

    less individual initiative and more central planning, check

    "there are wide fields of activity which are unaffected. The State will have to exercise a guiding influence on the propensity to consume partly through its scheme of taxation, partly by fixing the rate of interest, "

    But we just want the commanding heights!

    "and partly, perhaps, in other ways. Furthermore, it seems unlikely that the influence of banking policy on the rate of interest will be sufficient by itself to determine an optimum rate of investment."

    Well maybe not just the commanding heights...

    "I conceive, therefore, that a somewhat comprehensive socialisation of investment will prove the only means of securing an approximation to full employment;"

    what is somewhat comprehensive?

    "though this need not exclude all manner of compromises and of devices by which public authority will co-operate with private initiative."

    We the state will allow private activity if needs be.

    "But beyond this no obvious case is made out for a system of State Socialism which would embrace most of the economic life of the community."

    Keynes' is the Marxists idea of a capitalist. I'll use his greasy locution about other nasty ideas: "no obvious case is made out for a system of adding kittens to ground beef... no OBVIOUS case."

  7. mobsrule,

    This is well worth reading:

    Some of the most important parts deal with Keynes' desire to see Western economies cartelized.

  8. mobsrule,

    One of the things I take away from that paper, BTW, is just how trapped in one of the intellectual fetishes of his time period Keynes was (the need to centralize everything and to constrain most decisions to experts) - not terribly imaginative at all.

  9. Daniel,

    Cf. your misgivings about the Keynes-Hayek video to David Friedman's recent, and much-discussed, post about sustainability:

    The [sustainability] issue was recently brought to my attention when a colleague at a faculty meeting gave a glowing description of all the good things that were being done or planned in support of sustainability, up to and including a future teach in. I asked him one question — whether any part of the plans included presentations of arguments against sustainability. His answer was that any arguments against sustainability would be presented by speakers who were in favor of it.

    That is not how universities are supposed to function.

    Fair enough, universities and edutainment(?) videos are very distinct things, but the point remains valid...


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