I have expressed my feelings about how our country is suffering from a failure in economics many times. We have a monopoly in Keynesian economists being taught in America. The result of this is that every economist in Washington is a Keynesian economist. Keynesian economists allow politicians to spend a lot of money.

This is the way it should work: During a high-growth period the government should put aside some money to be spent to stimulate the economy in the low-growth period. What really happens is that no money is put aside, but when a low-growth period occurs the government borrows money to spend on a stimulus package. The problem is, it never works.

Austrian School economists believe in balancing the budget, so no money is ever borrowed. They follow Ludwig von Mises, who mentions in his book, “ Economic Freedom and Interventionism,” that you can’t have a stimulus package paid for by debt. This statement is more direct than Keynes’ statement above. When our government tries a stimulus package what they are trying to do is have a short-time growth spurt (gain), at the expense of a long-term liability (pain). I disagree with our government doing this, because this is similar to kicking the can down the road, causing the next generation to pay for the package.

It’s a shame that Americans can’t vote on our economic policy, as it is so important. In fact this policy is going to destroy America, and our divided government is going to be finger pointing. No one will take any blame for this lousy policy.

Don Crook

(1) comment


Be careful, Donny-Boy, the Von Mises Institute in Alabama, which so many of these libertarians and Tea Party folks (like Michelle Bachman) like to cite, was founded by a bunch of racist holocaust deniers.

They don't believe in democracy, and in the 1980's openly used racism to recruit adherents.

They defend the South in the civil war and despise Abraham Lincoln.

These are not nice people.

As for Von Mises himself, he comes from the Austrian School, not the other way around, as you state. Those guys reject math and statistics and prefer to just think about how they'd like stuff to work.

Economics with no empirical evidence? Every school of economic thought has some valid points, but that seems….more like a cult.

They should call themselves the Church of Wishful Thinking.

Here's a personal anecdote, and I know I'm simplifying things.... 60 years ago or so Eisenhower built the interstate freeway system.

Years later, the government funded research that led to the internet, where you're reading this now.

I work in tech. Thanks to government investment, I have a job, and other people have jobs delivering goods bought on the internet. Buy local when you can, of course.

But remember that next time you order one of those anti-government bumper stickers from Glenn Beck's website or watch The Blaze TV. The government made that possible.

So I owe my job to investments my grandparents and parents made in America. So does Glenn Beck.

That's how we grow. We borrow, invest, and grow. Every single company I've worked at, including very successful NASDAQ 100 and Dow listed corps have huge amounts of debt.

But they still make tons of money. If you want the government run like a business, then the government is going to borrow.

I love it when some Tea Partier tells me that it wasn't FDR's spending that got us out of the Great Recession, they tell me it was WW2.

Well, what's a war if not massive government spending? And I don't think we ever paid that money back, we just grew out of the debt.

Not that we shouldn't be careful how we invest, and I wish the federal, state, and local governments would think about those rainy days and plan, but to say the government should never borrow ignores history and reality and how capitalism works.

A "balanced budget" does not mean no debt, it means you have the revenue to pay the bill.

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