“Fear the Boom and Bust”: Hayek vs. Keynes Rap Video
By David J. Theroux • Tuesday January 26, 2010 1:21 PM PST •
Here is a splendid and insightful, new rap video pitting the ideas of Nobel Laureate, Austrian School economist Friedrich A. Hayek against those of Lord John Maynard Keynes. As Hayek has shown, economic crises of boom and bust are created by governments that expand credit through central banks, creating unsustainable bubbles that ultimately crash. Unfortunately, based on Keynes’s theories, governments have foolishly then further intervened with bailouts and “stimulus” spending measures of pork and war that only prolong the recovery (e.g., Great Depression as well as the current economic malaise). Our Senior Fellow Robert Higgs has shown the folly of Keynesian policies since 1930 in his acclaimed book, Depression, War, and Cold War. The choice is clear, Hayek’s free markets vs. Keynes’s corporatism.
Tags: aggregate demand, American History, and Cold War, animal spirits, Bailouts, Books, broken window, bubble, Budget and Tax Policy, Business, Corporatism, Depression, economic stimulus, Economics, Federal Reserve, Free Market, Friedrich A. Hayek, General Theory, government spending, Government subsidies, Great Depression, Inflation, John Maynard Keynes, Labor, liquidity trap, macroeconomics, malinvestments, Money and Banking, no free lunch, Obamanomics, paradox of thrift, public works, real savings, recession, Robert Higgs, sticky wages, Taxation, The State, underconsumption, Unemployment, Video, War