Thursday, September 10, 2009

Barack Obama
Accused Of Making
'Depression' Mistakes

by Edmund Conway - September 6th, 2009 - London Telegraph

Barack Obama is committing the same mistakes made by policymakers during the Great Depression, according to a new study endorsed by Nobel laureate James Buchanan.


The study represents a challenge to the widely held view that Keynesian fiscal policies helped the US recover from the Depression which started in the early 1930s. The authors say: "[Franklin D. Roosevelt's] interventionist policies and draconian tax increases delayed full economic recovery by several years by exacerbating a climate of pessimistic expectations that drove down private capital formation and household consumption to unprecedented lows."

This is another lesson in the great debate between "nanny state empathy" of the left and "tough love sympathy" of the right. Yet the most obvious problem is that neither side in the debate believes anything the other side says because of the gulf between their understanding of how the world works. Friedman adherents have no doubt that most people excel in a free economy. Keynes adherents believe that those few true failures who are helped by government intervention are worth the damage their policies do to everyone else.

The problem is that both sides cannot be correct. One is wrong. And though I believe that side is the Keynes side, I can see no way to ever get them to understand why they are wrong since they will never believe that I am not evil in my views.

This is a good article that I fear will only be read by those who already believe it. I think one expression to explain that is called "singing to the choir."


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