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Bully Pulpit

The term "bully pulpit" stems from President Theodore Roosevelt's reference to the White House as a "bully pulpit," meaning a terrific platform from which to persuasively advocate an agenda. Roosevelt often used the word "bully" as an adjective meaning superb/wonderful. The Bully Pulpit features news, reasoned discourse, opinion and some humor.

Tuesday, May 23, 2006

The Myth of Functional Finance: Mises vs. Lerner

Those familiar with the history of twentieth 20th-century economic thought know of the dominance of "Keynesian economics" following the Second World War. While John Maynard Keynes typically receives credit for transforming economics, much postwar Keynesian economics was actually developed by his interpreters and followers.

Perhaps the single most important one of these followers was the Romanian born economist Abba P Lerner. Keynes's book The General Theory of Employment, Interest, and Money popularized the notion that market economies were prone to persistent unemployment. Keynes often receives credit for promoting government deficit spending as a means of combating unemployment. However, Abba Lerner developed this part of the Keynesian program.

Keynes did suggest the socialization of some investment by elected officials. This would solve the problem of unemployment within the framework of a democratic society. Yet Keynes did not work out the details of how this would work. Lerner (1943) proposed a program of "functional finance" to counteract the business cycle.

DW MacKenzie


Blogger RT Miller said...

The way this author treated this topic with relation to different presidents was interesting, and gave us all a peak at his biases.

This author attributes federal budget surplusses &/or deficits of the 20th century to each of the presidents whose term coincinded with them.....except....guess who? Rather than giving Bill Clinton any credit for creating the 1990's budget surplusses, he credits that feat to the Republican congress. Of course when the deficits' return coincided with the end of Clinton's 2nd term and the beginning of Bush II's first term, the author went right back to blaming the executive branch.

Is it that difficult for "conservatives" to admit that Clinton was the most fiscally responsible president we've had in decades?

Tuesday, May 23, 2006 12:49:00 PM  
Blogger Steve Brenneis said...

Leave it to you, Tucker, to impose some jingoist nonsense on this article. Congratulations. The brainwashing committee up at North Stokes would be so proud.

The article is the product of the Mises institute. Ludwig von Mises was a free-market libertarian of the Austrian school, the same group of economists that produced Milton Friedman and F.A. Hayek. The author is of the Mises school as well and the point of the article was to show the inevitable pollution of Keynesian economics that produced the current politically controlled economic climate and how von Mises predicted it. The author is not a Republican or a conservative. He is a libertarian capitalist. He used the word Republican once, as an adjective. It had no partisan context and he didn't even mention Bill Clinton.

Only a spite-filled partisan like you would see this article in terms of a Democrat-Republican dichotomy. Well, at least you're consistent.

Tuesday, May 23, 2006 2:44:00 PM  
Blogger RT Miller said...

Huh....my post only used the word Republican once as well (in the same manor as the author), and didn't use the word Democrat at all. Partisan?

The author may not have mentioned Bill Clinton, but he did use the name of almost every other president of the 20th century when describing the various economic practices used during their respective tenures. That is what makes Clinton's ommission so striking -- considering he was the only president in the last 30 years to run a budget surplus and pay off (a portion) the national debt. It seems like that factoid is definitely relative to the article's subject matter, and should have been mentioned.
To whom does the author attribute the budget surplusses of the 1990's? The REPUBLICAN congress. (the only time the author even mentions congress)

Steve, are you sure I'm the one with the bias?

Wednesday, May 24, 2006 8:45:00 AM  
Blogger Steve Brenneis said...

Nice try, Tucker. You read the article with your standard (and genetic) liberal Democrat bias and when it was revealed that polemics had nothing to do with the article you tried to weasel out.

Your assertion that he mentioned "almost every other president of the 20th century" is as ridiculous as it is pointless. But since you're so anal on the topic of "fact and figures," let's examine:

The article mentions Harding, Coolidge, Hoover, Roosevelt (FDR), Truman, Nixon, and Bush (43). It does not mention McKinley, Roosevelt (Teddy), Taft, Wilson, Eisenhower, Kennedy, Johnson, Ford, Carter, Reagan, Bush (41), or Clinton. Furthermore, Nixon is only mentioned in passing and not with respect to any policy or action. In short, there is nothing more "striking" about the ommission of Clinton's name than there is with regard to the ommission of Reagan's, or even Taft's.

Of course, the executive in charge is completely beside the point here, as is the partisan relationship to deficit spending. The article's assertion is that politicians, regardless of party, will find Lerner's evolution of Keynesian economics too tempting to resist As should be obvious to anyone with post-elementary school reading ability, the thesis of the article is that von Mises predicted this effect in his criticisms of Keynesian theory.

You tried to create a partisan slant to the article where none exists. Come back when your capacity for comprehension escapes the bounds of jingoism ingrained into you from birth and reinforced up at the good old People's Republic of North Stokes.

Wednesday, May 24, 2006 10:51:00 AM  
Blogger RT Miller said...

If reading comprehension is at question here, then Steve, you need focus on your own. When in either of my comments did I ever make assertions -- or even mere mention -- of the author's thesis? I did say that the article was interesting, but did not say that i disagree (or agree) with any of the claims in it.

What i did point out, however, is this:
Not unlike any of the other authors' works that you might post on the BP, this one would never in a million years say anything complimentary about any poltician, statesman, economist, etc., that might be potentially perceived or labeled as a "liberal".

Why go through the trouble of doing such a thing? I don't know who reads the BP, but whoever might stumble across these articles you choose to post should be informed that Steve Brenneis would never post anything that does not share his particulrly peculiar brand of bias.

I never tried to assert that there was any PARTISAN slant in this article, only an IDEALOGICAL slant -- even if this bias is of the subcionscious, it does affect both the author's and Steve's ability to look at, & comment on, ANYTHING objectively.

Wednesday, May 24, 2006 12:03:00 PM  

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