Friday, November 06, 2009
Over at TNR's The Plank, in response to a Chait post on Obama
(and Ben Nelson), this comment by raylward:
When an entire political party disbelieves Keynes' theory (Nixon, it turns out, was wrong when he said "we are all Keynesians now"), many if not most members of the other political party don't understand the theory, the Democratic leadership let the legislative process regarding the stimulus legislation devolve into an excuse for public funding of the members' favorite pet projects, the public either has never heard of Keynes or believes the General Theory has something to do with evolution, and a tepid president focuses his attention and by extension the attention of the public on give aways to big banks and car companies, is it any wonder there was/is little enthusiasm for more public spending as a way to avoid a high unemployment, low output equilibrium, especially, early in the year, when unemployment wasn't particularly high ...
Repeat after me, "Ben Nelson doesn't believe in Keynes' General Theory
Of course Democrats don't understand the nuances of Keynesian economics. They don't need to understand it. All they need to know is that it provides a rationale for the spending binge they had been craving for years and years. It's like the 300 pound woman who fervently buys into the "all the chocolate you can eat" diet. Whether or not it works is really beside the point. The point is to rationalize an otherwise indefensible indulgence.
what about this version?
When it comes to economic orthodoxy, the Party of the Church is no more consistent with traditional Republican principles. Although the Republicans claim to be devoted to free markets, most of the big economic interests identified with the party are surprisingly dependent on federal subsidies, protectionism, or both. The most obvious examples are southern growers of cotton, sugar, oranges, and peanuts, and midwestern producers of grain. The Administration is so committed to shielding these interests from global competition that it elected to let the Cancún round of trade negotiations collapse—dealing a significant blow to the prospects for expanded free trade—rather than pressure Congress to reduce U.S. agricultural subsidies. In similar fashion, the Bush Administration supports lavish federal subsidies for a wide range of extractive industries (including oil, gas, and coal) and for cattle ranching.