Saturday, February 6, 2010

Keynesian Economics Another Progressive Trojan Horse
  Economics piece by Malcolm T. Hedges

You learn something every day. A piece on WND brought to light valuable previously undiscovered information on Keynesian Economics.

I had always wondered why the method was constantly used and always resulted in economic disaster.  This article: ‘Conservative’ PM embraces global governance points out the “real” Keynesian Economics.

“Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become ‘profiteers,‘ who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.“(1)(2)

“At the height of the Great Depression, in 1933, Keynes published The Means to Prosperity, which contained specific policy recommendations for tackling unemployment in a global recession, chiefly counter cyclical public spending. The Means to Prosperity contains one of the first mentions of the multiplier effect. While it was addressed chiefly to the British Government, it also contained advice for other nations affected by the global recession. A copy was sent to the newly elected President Roosevelt and other world leaders. The work was taken seriously by both the American and British governments, and according to Skidelsky, helped pave the way for the later acceptance of Keynesian ideas, though it had little immediate practical influence.“(3)

“In late 1965 Time magazine ran a cover article with the title inspired by a possibly tongue-in-cheek comment from Milton Friedman, a comment later echoed by U.S. President Richard Nixon, that “We are all Keynesians now”. The article described the exceptionally favourable economic conditions then prevailing, and reported that “Washington’s economic managers scaled these heights by their adherence to Keynes’s central theme: the modern capitalist economy does not automatically work at top efficiency, but can be raised to that level by the intervention and influence of the government.“(3)

“the intervention and influence of the government”. is the key.  Early Progressives I loved the statist aspect of the Keynesian methods and theories.

“Keynesian economics were officially discarded by the British Government in 1979, but forces had began to gather against Keynes’s ideas over 30 years earlier. Friedrich von Hayek had formed the Mont Pelerin Society in 1947, with the explicit intention of nurturing intellectual currents to one day displace Keynesianism and other collectivist influences.“(3)

Now we have “the Keynesian resurgence of 2008–2009” used by Progressives and Socialists that has resulted in “The Raw Deal” and our to be endless recession and economic repression.(3) 

Malcolm T. Hedges
http://malcolmhedges.com/

1) http://en.wikiquote.org/wiki/John_Maynard_Keynes

2) http://www.gutenberg.org/etext/15776

3) http://en.wikipedia.org/wiki/John_Maynard_Keynes

Posted by Malcolm T. Hedges on 2/6/10

Email Author  [Email Article To Someone.]  (Permalink) Print This Page

UPSSA United Progressive Socialist States of America