Maynard’s Revenge (On the Keynesians)
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Lot’s of chart porn in this one hour presentation. Lance Taylor, Arnhold Professor of International Cooperation and Development at the New School for Social Research, explains the Great Recession and its causes in a lengthy recap of the sort of myth-making dominant among Keynesian economists. While his data are very compelling, and his accompanying narrative is very convincing, ultimately his explanation collapses on an essential fact: The failed policies he tries to ascribe to others are ultimately the fault of Keynesian policies – since all policies implemented by Washington have merely been a variant of post-war American Keynesian expansionary growth economics. The bubbles that arose since 1980 were made possible by the dominance of this application of Keynes ideas.
The simple truth is Lord Keynes actually argued that his ideas, when applied in this fashion, had a limited shelf-life. Pretty much as he predicted, fiscal and monetary expansionary policies could not be used to avoid reducing hours of work. Mr. Taylor does not want to recognize this fact, and so he instead tries to place the blame on deregulation of the banking industry, when he knows – or should know – deregulation itself was made necessary by the policy of continuous economic expansion in Washington.