>Former Fed Gov. Lawrence Lindsey, a fervent supply-sider, for arguing for an >across-the-board 10% tax cut to "put $70 billion in the hands of consumers," to spur >them to keep buying more while saving less ( The Wall Street Journal, December 9), >notwithstanding consumer debt and defaults being at all time highs. It sounds like >a typical Keynesian idea to me. >Are we seeing dialectics at work? Are these traditional labels >inoperative in a new conceptual synthesis? Is this postmodern >Monetarism or deconstructed Keynesianism? This is standard supply-side economics of the sort that Reagan pushed, with a regressive tax cut being touted as somehow unleashing supply-side growth. In practice, however, it would have a demand-side (Keynesian) effect, just as Reagan's tax cut did in the 1980s. (The rising government deficit, along with easing monetary policy promoted recovery from the 1982 recession.) Also, the supply-siders claim that the 1964 tax cut was successful for supply-side reasons. But the weakness of the Reagan-Laffer-Kemp supply-side mechanism means that in practice, it's Keynesian economics, with a more regressive tilt. >There is a lot of rumbling in the globalized Street that the major >reason the Asian, Russia, Brazilian crises did not caused a sustained >panic in the stock market was that practically all government economists >have turned Keynesian. Is that an accurate assessment? I don't know about the government economists, but the IMF sure isn't Keynesian. I think that this refers to Alan Greenspan taking the lead in pushing down interest rates, to be followed by W. Europe, along with Japan's weak expansionary policies and the like. I guess Greenspan is a Keynesian (broadly speaking), because he's a fine-tuner with faith in his own power to steer the economy. As usual, the answer depends on what you mean by "Keynesian." .... >There was a c-span program on the 1968 election moderated by Kevin Phillips on New >Years eve, with Pat Buchanan, Nixon's press secretary in the campaign and others. >The consensus was the Nixon was a liberal, with Keynesian economics and abandoning >the gold standard, opening to China, Detent, arms control, free trade, etc. Nixon was definitely more liberal than Clinton. Jim Devine [EMAIL PROTECTED] & http://clawww.lmu.edu/Faculty/JDevine/jdevine.html
