The Plutocrats And Their Economists ( aka Mercenaries Dressed As Economists )

Paul Krugman’s The Smith/Klein/Kalecki Theory of Austerity:

Noah Smith recently offered an interesting take on the real reasons austerity garners so much support from elites, no matter hw badly it fails in practice.


Elites, he argues, see economic distress as an opportunity to push through “reforms” — which basically means changes they want, which may or may not actually serve the interest of promoting economic growth — and oppose any policies that might mitigate crisis without the need for these changes:

I conjecture that “austerians” are concerned that anti-recessionary macro policy will allow a country to “muddle through” a crisis without improving its institutions. In other words, they fear that a successful stimulus would be wasting a good crisis.

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If people really do think that the danger of stimulus is not that it might fail, but that it might succeed, they need to say so. Only then, I believe, can we have an optimal public discussion about costs and benefits.

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And the lineage goes back even further. Two and a half years ago Mike Konczal reminded us of a classic 1943 (!) essay by Michal Kalecki, who suggested that business interests hate Keynesian economics because they fear that it might work — and in so doing mean that politicians would no longer have to abase themselves before businessmen in the name of preserving confidence.

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Not Naming … The Dishonest Old Big Mouth, Famous On the Portuguese TV

Paul Krugman’s Disco-era Macroeconomics ( just scroll down, you know. ):

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Needless to say, I get this all the time. But it usually comes from people who have some excuse for not knowing either what Keynesianism means or what actually happened in the 70s.

So, what people like me have been calling for is a temporarily relaxed attitude toward deficits as long as the economy remains depressed and monetary policy is up against the zero lower bound. What does that have to do with the 70s?

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No, i am not an economist, but you need NOT to be one to read about or to decipher a liar/dishonest economist, like the old gentleman who likes to insult people on TV.