Stimulus spending after structural changes have already taken place and aggregate supply has fallen isn’t Keynesianism. I don’t know what it is. Politically-motivated opportunism? Ignorance?
Stimulus spending after structural changes have already taken place and aggregate supply has fallen isn’t Keynesianism. I don’t know what it is. Politically-motivated opportunism? Ignorance?
“Never let a good crisis go to waste”
Uhhh, there is no crisis. Keynes advocated for public spending in a crisis to support demand. The current stimulus (cutting taxes) is taking place at a time when the economy is doing well and demand is not really an issue. I have held off being too critical of this as there just isn’t much history of this happening. I don’t think anyone knows what will happen. My guess is that we see some growth, but we also see our debt continue to rise. This will be hard to sort out as we are in a global growth phase right now and the tariffs will be a confounder. On top of that it has also been a long recovery already.
Steve
It’s also known that debt itself is an impediment to growth.
steve,
Keynes was thinking in terms of fixed exchange rates when he made that countercyclical argument.
And if public debt is actually a problem, we can easily (as a matter of monetary operations) cancel the liabilities.
From a monetary operations standpoint, it’s trivial. It’s probably politically impossible.
Two years ago I would have agreed with you. But I have since seen political change at a scale and speed that I’m not sure has precedent in American history, and I think we’re still at the beginning.