The New Deal Was Not Keynesian

Discussion in 'Economy' started by Agnapostate, Feb 15, 2009.

  1. Agnapostate

    Agnapostate BANNED

    Sep 19, 2008
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    The Quake State
    It's grown aggravating to hear the New Deal constantly referenced as "Keynesian" or even more deplorably, as "socialist."

    As Renshaw illustrates in Was there a Keynesian Economy in the USA between 1933 and 1945?, the New Deal cannot accurately be described as "Keynesian."

    Indeed, Stein's summary was remarkably accurate. As he noted, “It is possible to describe the evolution of fiscal policy in America up to 1940 without reference to [Keynes]...y the outbreak of the war a large part of the fiscal revolution had already occurred. It was accepted policy that we would run deficits in depressions, that we would not raise taxes in depressions in an attempt to balance the budget.”

    Hence, I would hope that the educated free marketer would re-evaluate that analysis of the New Deal as Keynesian, instead of relying on the Mises Institute to provide economic analysis. The "talking points" free marketer will simply continue to blather on that all government participation in the economy is necessarily Keynesian, or worse, that it is "socialist."

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