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Monday, December 15, 2008

Do stimulus packages work, or why the heck is anyone a Keynesian?

Terence Corcoran, Editor of the Financial Post is on a mission to put an end to the Keynesian "craziness" en vogue in the worlds' capitals, including Ottawa; he writes:

As the Keynesian revival sweeps the policy establishment, here's a fine antidote. It's a video on the Keynesian myths behind the global push to crank up government spending and the size of government to stimulate the economy. In less than 8 minutes, Dan Mitchell, a Senior Fellow at the Cato Institute, explains why it hasn't worked in the past, and won't work now. Complete with graphs, but best of all is Mitchell's crisp, clear and steady delivery. See it here.

And then send it to everyone you know in any country. Every government and politician, from America's Obama to Canada's Harper to France's Sarkozy to the leaders of China, Japan, the United Kingdom - is rushing to implement Keynesian policies. This video could help stop some of the craziness.

Check after the break for the video from Dan Mitchell and the Center for Freedom and Prosperity assessing the logic of Keynesian policies and their record in the 20th century.

Last week Western Standard editor Peter Jaworski pointed to two new empirical studies identifying "anomalies" which seem to fly in the face of the standard Keynesian theories. They conclude, like Mitchell, that tax cuts are better at improving the state of the economy than increased government spending.

Posted by Kalim Kassam on December 15, 2008 | Permalink


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Kalim, so the free market is NOT failing? Thanks for an excellent post. Corcoran's suggestion to spread the word is also excellent!

Posted by: TM | 2008-12-15 9:37:40 PM

Do stimulus packages work?


And we're going to see this whole thing fall squarely on its face over the next couple of years.
I hope everyone is ready to weather that storm, because its definately on the way.

Posted by: JC | 2008-12-16 6:31:37 AM

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