Thursday, July 19, 2012

Quotation of the Day: Rearden Steel

“He didn’t invent iron ore and blast furnaces, did he?” 

“Who?” 

“Rearden. He didn’t invent smelting and chemistry and air compression. He couldn’t have invented his Metal but for thousands and thousands of other people. His Metal! Why does he think it’s his? Why does he think it’s his invention? Everybody uses the work of everybody else. Nobody ever invents anything.” 

She said, puzzled, “But the iron ore and all those other things were there all the time. Why didn’t anybody else make that Metal, but Mr. Rearden did?” 

~Atlas Shrugged, Chapter 9, page 1


51 Comments:

At 7/19/2012 8:06 AM, Blogger Jon Murphy said...

Have you seen the movie? It was actually pretty good.

 
At 7/19/2012 8:33 AM, Blogger givemefreedom said...

Obama saw the movie as well but unfortunately he got the protagonist and antagonist completely reversed.

 
At 7/19/2012 8:55 AM, Blogger Che is dead said...

"You didn't do that, somebody else made that happen."

 
At 7/19/2012 9:08 AM, Blogger Krishnan Chittur said...

A novel written 50 plus years ago - It is eerie how the events have unfolded recently. From Obama and his team blaming Bush for everything - to Obama (Elizabeth Warren) claiming that our country was not built by individuals with vision.

I do hope that to the majority of voters, there is indeed no doubt that Obama is indeed a Marxist - At heart, a tyrant who seeks control over other people's lives while living the good life as a parasite. Obama may indeed be so steeped in his ideas that he does not care what may have happened in the Soviet Union or China or Albania or ... He is the ultimate narcissist who imagines that HE can do anything that the world failed at.

 
At 7/19/2012 10:01 AM, Blogger VangelV said...

A novel written 50 plus years ago - It is eerie how the events have unfolded recently. From Obama and his team blaming Bush for everything - to Obama (Elizabeth Warren) claiming that our country was not built by individuals with vision.

Bush was not exactly a supporter of free market capitalism. He used tariffs to protect inefficient producers, handed out government contracts to rent seekers, and increased regulations that protected producers from competition from domestic and foreign sources.

 
At 7/19/2012 10:37 AM, Blogger sethstorm said...

Unfortunately for that book, technology and capability has caught up in wonderful ways.

That Gulch you have there - no longer hidden thanks to the aerospace industry. Sensors of various types would not only out the place, it would even tell what people are coming and going.

Strikes of capital - they can easily be broken as strikes of labor. While there are various forms of withholding already present, laws exist on the books to handle the more extreme cases - where the nation can do something before it is too late.

In addition, various terrorists of the book would find themselves outmatched by the military of the top superpower - the US. The pirates from the book would end up dead or as residents of various prisons like Colorado's supermax, GITMO, or various blacksites across the world. Even with potential sedition within the ranks, there would be more than enough to handle the problems in the US.

The reality is that such a concerted action would become a small even that was put down.

 
At 7/19/2012 10:43 AM, Blogger morganovich said...

"Obama saw the movie as well but unfortunately he got the protagonist and antagonist completely reversed."

sounds like seth did too...

 
At 7/19/2012 10:53 AM, Blogger Ken said...

Krishnan,

It is eerie how the events have unfolded recently.

It's because this is not the first time events like this have unfolded. These events are entirely predictable.

 
At 7/19/2012 11:08 AM, Blogger Jon Murphy said...

In the movie (not sure about the book), they pass a low to "encourage economic growth" that prevents a person from owning more than one business. "Who would pass something like that?!" I though to myself. Then i found out Framingham, Massachusetts as that law.

 
At 7/19/2012 11:21 AM, Blogger Paul said...

And so, of course, the Obama spin team is saying he's been taken "out of context." Funny how that always happens when he goes off teleprompter, and he never screws up on the side of freedom. Here's James Taranto blasting the Obama spin doctor's rationale:

"That's bunk, and not only because "business" is more proximate to the pronoun "that" and therefore its more likely antecedent. The Truth Team's interpretation is ungrammatical. "Roads and bridges" is plural; "that" is singular. If the Team is right about Obama's meaning, he should have said, "You didn't build those."

Barack Obama is supposed to be the World's Greatest Orator, the smartest man in the world. Yet his campaign asks us to believe he is not even competent to construct a sentence."

 
At 7/19/2012 11:23 AM, Blogger bart said...

"Obama saw the movie as well but unfortunately he got the protagonist and antagonist completely reversed."

Although I'm far from a Romney fan, if his marketing people have some smarts, this could hugely blow up in Obama's face. A TV spot like LBJ's nuclear bomb blast one or Apple's Mac intro one, both of which only ran once... one can hope.

 
At 7/19/2012 11:38 AM, Blogger VangelV said...

That Gulch you have there - no longer hidden thanks to the aerospace industry. Sensors of various types would not only out the place, it would even tell what people are coming and going.

Perhaps, but access to technology works both ways. It is easy to hide right in the open if you know what you are doing. And with the growth of private communities it is quite easy to move a lot of people off shore and still have them access the same information and entertainment networks that the parasites can access.

Strikes of capital - they can easily be broken as strikes of labor. While there are various forms of withholding already present, laws exist on the books to handle the more extreme cases - where the nation can do something before it is too late.

Laws can't force you to be active. And governments cannot confiscate production that does not take place.

In addition, various terrorists of the book would find themselves outmatched by the military of the top superpower - the US.

Really? What war has the US military won recently? If a smart group really wanted to do damage there are many ways without bringing any attention to its actions. The US government has been lucky that the current batch has quite a few screws lose and is not all that disciplined.

The pirates from the book would end up dead or as residents of various prisons like Colorado's supermax, GITMO, or various blacksites across the world. Even with potential sedition within the ranks, there would be more than enough to handle the problems in the US.

Actually, a bankrupt nation that is trying to control riots in the streets would have a hard time trying to find pirates who have access to technology. Do you know how many soft but critical targets are accessible to even the dumbest terrorist?

This is one of my fears about the whole DHS thing. From what I see the people running it are idiots and are not doing what needs to be done to protect critical infrastructure from harm.

The reality is that such a concerted action would become a small even that was put down.

How do you figure that? People have the right not to produce for parasites. They can simply take their capital, move off shore somewhere and play golf until after the country collapsed.

 
At 7/19/2012 11:40 AM, Blogger VangelV said...

Although I'm far from a Romney fan, if his marketing people have some smarts, this could hugely blow up in Obama's face. A TV spot like LBJ's nuclear bomb blast one or Apple's Mac intro one, both of which only ran once... one can hope.

The problem is that Obama and Romney are not very apart on issues that matter. They are both pro-war, anti-liberty and favour big government and deficit spending.

 
At 7/19/2012 11:44 AM, Blogger bart said...

The problem is that Obama and Romney are not very apart on issues that matter. They are both pro-war, anti-liberty and favour big government and deficit spending.

Generally true, but there are differences. Maybe I'm putting words in your mouth, but if you *had* to vote and Obama and Romney were your only choices (yes, I know neither of us would vote for either in reality), I can't imagine you voting for Obama... and apologies if I'm wrong.

 
At 7/19/2012 12:00 PM, Blogger givemefreedom said...

"Unfortunately for that book, technology and capability has caught up in wonderful ways."


The book has absolutely nothing to do with technological capabilities. It is about ideas, freedom and human advancement. It is incredible that someone would miss that point but I guess it is inevitable that some people do.

All this is beside the point. What is truly incredible is that Ayn Rand basically wrote Obama's speech 50 years ago!!!

 
At 7/19/2012 12:01 PM, Blogger Jean-Paul said...

I read this novel without much enthusiasm but this quote makes me appreciate it more.

Thanx!

 
At 7/19/2012 12:21 PM, Blogger Paul said...

"The problem is that Obama and Romney are not very apart on issues that matter. They are both pro-war, anti-liberty and favour big government and deficit spending."

The usual VangeIV nonsense when it comes to politics. I really wish he'd stick to the areas like energy and economics where he usually shines.

It was hoping the GOP would get a better candidate, but as it is there's such a vast difference between Obama and Romney, only a fool would say they are the same. Just look at their life experience. Romney is a phenomenally successful businessman who grew the economy. Obama was an Alinskyite community organizer parasite who sued banks to force them to give out loans to people who couldn't pay them back. They are remarkably different.

 
At 7/19/2012 12:36 PM, OpenID Sprewell said...

I can't believe Obama is dumb enough to parrot the Elizabeth Warren line, that was so controversial for her. But it really does show what the liberals believe, that the govt is what makes everything possible so when the politicians and bureaucrats come calling for their pound of flesh, they deserve to extract their taxes in return. One wonders if Obama and Warren rationalize it to themselves as they're using that money to help the poor and middle class, or if they honestly do believe that Al Gore invented the internet and therefore everything that comes out of it belongs to them. Delusional or stupid, that truly is the question.

 
At 7/19/2012 12:55 PM, Blogger Paul said...

Sprewell,

" One wonders if Obama and Warren rationalize it to themselves as they're using that money to help the poor and middle class,"

Watch this latest video from James O'Keefe and you be the judge. They know all about the corruption, and they don't care because it keeps their coalition together.

 
At 7/19/2012 1:54 PM, Blogger juandos said...

"He used tariffs to protect inefficient producers, handed out government contracts to rent seekers, and increased regulations that protected producers from competition from domestic and foreign sources"...

Well vangeIV do you something credible to back that statement up?

 
At 7/19/2012 3:50 PM, OpenID Sprewell said...

Paul, thanks for the link, spent some time watching other O'Keefe videos from his feed. Amazing how openly these people will talk about their schemes and biases, when they think they're talking to somebody on their side.

 
At 7/19/2012 5:25 PM, Blogger sethstorm said...


Watch this latest video from James O'Queef and you be the judge. They know all about the corruption, and they don't care because it keeps their coalition together.


That guy should be surprised to be alive, much less kicked out. If I worked in an industry that might see his presence, I'd require a background check, including fingerprints, of any new partners as a measure of security.

Worst case, I'd know who they really were and could unmask them. Done enough times, they'll run out of people to grab, becoming more vulnerable to infiltration.



He doesn't tell the truth, he just goes for something that can be misrepresented. I'd think that he's the guy that tried to smear Sherrod Brown(through contacting his wife) and failed miserably.

 
At 7/19/2012 5:44 PM, Blogger Paul said...

Sethstorm,


"That guy should be surprised to be alive, much less kicked out. If I worked in an industry that might see his presence, I'd require a background check, including fingerprints, of any new partners as a measure of security."


Well, first you need to get out of your mother's basement and get a job. Then maybe you can start fantasizing about your tough guy measures you'd implement with the other goons.

 
At 7/19/2012 6:42 PM, Blogger Craig Howard said...

Bush was not exactly a supporter of free market capitalism. He used tariffs to protect inefficient producers, handed out government contracts to rent seekers, and increased regulations that protected producers from competition from domestic and foreign sources.

Of course, that's all very true but no one is talking about Bush. He was a great friend of big government, but he didn't hate entrepreneurs, either.

 
At 7/19/2012 7:26 PM, Blogger sethstorm said...


7/19/2012 5:44 PM, Blogger Paul said...

It is not unreasonable to do a comprehensive background check on potential business partners, when your industry has infiltrators and espionage working against you.

Since the guy had his prints run collected, it would be easy to match him. In addition, this would make it hard for others to commit the fraud required in these "out of context" smears.

Such a background check would enhance the value of legitimate relationships while discouraging smear merchants.

 
At 7/19/2012 7:55 PM, Blogger VangelV said...

Generally true, but there are differences. Maybe I'm putting words in your mouth, but if you *had* to vote and Obama and Romney were your only choices (yes, I know neither of us would vote for either in reality), I can't imagine you voting for Obama... and apologies if I'm wrong.

The lesser of two evils is still evil. I would never vote for either of them.

 
At 7/19/2012 7:56 PM, Blogger VangelV said...

All this is beside the point. What is truly incredible is that Ayn Rand basically wrote Obama's speech 50 years ago!!!

Sadly, it is not all that incredible. Human nature does not change much and public 'intellectuals' are just as stupid and unprincipled as they always have been.

 
At 7/19/2012 8:03 PM, Blogger VangelV said...

It was hoping the GOP would get a better candidate, but as it is there's such a vast difference between Obama and Romney, only a fool would say they are the same.

Have you looked at their platforms? Both lead to deficits over the next decade, more war, and less individual liberty. Romney would 'cut' the increase in spending a bit over Obama but not in any meaningful way. And Romney is far more likely to nuke some country than Obama is.

Just look at their life experience. Romney is a phenomenally successful businessman who grew the economy.

He is good at playing the game that the Fed has nurtured but pretty ignorant of economics and is incapable of seeing what the future holds.

Obama was an Alinskyite community organizer parasite who sued banks to force them to give out loans to people who couldn't pay them back. They are remarkably different.

The fact that Obama may be an International Socialist while Romney is a National Socialist does not mean that they are very different. In fact, I would say that both men are National Socialists who want a partnership between corporations and government. That means more government and less liberty and that is not good for anyone.

Compare the ignorance of both men with the foresight of one of their opponents.

 
At 7/19/2012 8:07 PM, Blogger VangelV said...

"He used tariffs to protect inefficient producers, handed out government contracts to rent seekers, and increased regulations that protected producers from competition from domestic and foreign sources"...

Well vangeIV do you something credible to back that statement up?


The steel tariffs are a good start.

You can move on to the contracts handed out in Afghanistan and Iraq are another.

Or the regulatory oversight of the financial system and bailouts.

You can also take a look at ethanol subsidies and mandates.

The fact is that Bush was one of the biggest spenders and one of the worst presidents in your history. The fact that Obama is not much better is no consolation.

 
At 7/19/2012 8:09 PM, Blogger VangelV said...

Of course, that's all very true but no one is talking about Bush. He was a great friend of big government, but he didn't hate entrepreneurs, either.

No, Bush did not hate entrepreneurs. But he certainly propped up inefficient businesses, subsidized producers, and used mandates to force consumers to buy more expensive products. Romney is not much better and is clueless about the very factors that got the country into the mess that it found itself in.

 
At 7/19/2012 9:24 PM, Blogger Itchy said...

You were a lazy slacker in highschool, but somehow managed to get into Columbia. No one was all that impressed by you, not even your composite girlfriend. You spent time as a community organizer, stirring up the underclass by promising the other people's money. You showed up a few times in the Senate before running for President, and you are such a brilliant speaker that you can't manage to do it without a teleprompter. Yet, somehow you became President of the United States...You didn't do that someone else did that for you.

I guess G.W. has a similar storyline too.

 
At 7/19/2012 9:58 PM, Blogger bart said...

The lesser of two evils is still evil. I would never vote for either of them.

Fair enough.

 
At 7/20/2012 10:30 AM, Blogger Paul said...

Sethstorm,

"It is not unreasonable to do a comprehensive background check on potential business partners, when your industry has infiltrators and espionage working against you."

Fascinating that's what you got out of the video.

 
At 7/20/2012 10:34 AM, Blogger Paul said...

Vange,

"Both lead to deficits over the next decade, more war, and less individual liberty."

That's such generalized blather I don't really have any interest in unpacking it.

"He is good at playing the game that the Fed has nurtured but pretty ignorant of economics and is incapable of seeing what the future holds. "

So you can't even give him any credit for his stewardship over Bain Capital? God, your Ron Paul cult really has you by the nutsack.

 
At 7/20/2012 11:34 AM, OpenID Sprewell said...

Vangel, I just watched that Ron Paul video you linked above for the first time and wow, it's amazing how much he got right in 2002. That took some balls to trot out so many negative predictions one after the other, 7 months after 9/11 in front of Congress, and then to be proven right on almost every one? Amazing. I'm not as negative on a market and monetary collapse as he is, but I do despair that the growth of govt and damage to the US Constitution over the last 10 years is irreversible.

 
At 7/21/2012 1:38 PM, Blogger VangelV said...

So you can't even give him any credit for his stewardship over Bain Capital? God, your Ron Paul cult really has you by the nutsack.

Where do you get this idea? I gave him credit for using the corrupt system to enrich himself and his investors. I merely point out that he does not even understand that the corrupt system is robbing savers and workers of purchasing power and that unless the government goes back to a currency that is backed by PMs or something tangible the economy will continue to deteriorate as it has been since the early 1970s.

 
At 7/21/2012 1:41 PM, Blogger VangelV said...

Vangel, I just watched that Ron Paul video you linked above for the first time and wow, it's amazing how much he got right in 2002. That took some balls to trot out so many negative predictions one after the other, 7 months after 9/11 in front of Congress, and then to be proven right on almost every one? Amazing. I'm not as negative on a market and monetary collapse as he is, but I do despair that the growth of govt and damage to the US Constitution over the last 10 years is irreversible.

That is the strange part. I did not find it that amazing because anyone who has knowledge of human nature and the Austrian School could (and many did) make the same predictions. The problem is that the system is run by people who are Keynesians, Monetarists, and Straussian 'B' types. They cannot see what is inevitable and are content to keep going with the flow and using short term uncertainty to cloud the much bigger picture.

 
At 7/21/2012 2:08 PM, Blogger bart said...

Vangel, amongst all the non Austrian economists out there, do you have a relative favorite or two?

I'm pretty much certain that none of them meet your full requirements, but I also recall you recommending some non Austrian's name instead of Bernanke many years ago before Bernanke was chosen. I was also leaning mildly in favor of the Canadian Robert Mundell at the time, in case that helps jog your memory

 
At 7/21/2012 6:09 PM, Blogger VangelV said...

Vangel, amongst all the non Austrian economists out there, do you have a relative favorite or two?

I'm pretty much certain that none of them meet your full requirements, but I also recall you recommending some non Austrian's name instead of Bernanke many years ago before Bernanke was chosen. I was also leaning mildly in favor of the Canadian Robert Mundell at the time, in case that helps jog your memory .


I am not a big Mundell fan because he knows so little about monetary theory and got so many things wrong even though he was supposed to be an expert. My favourite economists are quite radical but I can tolerate a few of the George Mason types even though I have serious problems with some of the things that they write about. That said, I have changed my own mind on a number of issues so some of those economists may yet convince me.

My biggest problem is that I think that what is really needed is some to integrate some of the Straussian teaching with that of the Austrian School, which seems to be in total opposition to it. I was hoping that Paul Cantor, the literature professor who knows Mises' teaching so well but writes Straussian interpretations of Shakespeare plays might inspire some young man or woman to bring in a new theory that incorporates praxeology and rationality with thymos.

Of the GMU guys I have a lot of time for Russ Roberts, Donald Boudreaux, Peter Leeson, Peter Boettke (who is an Austrian), Bryan Caplan, and (at times) Tyler Cowen. I have referenced Daniel Klein's work on the early turnpikes in American history when arguing with the lefties on this site so he would be recommended.

 
At 7/21/2012 6:44 PM, Blogger bart said...

Thanks Vangel.

Mundell sure beats dorks and political hacks like Krugman, but yes - I wouldn't have chosen him then if I had known what I know now.

I certainly do admire the portion of the Straussian view that brings more of the other social sciences into economics, but I also confess to having not studied it much.

I'm still pretty much behind Galbraith's "Economics exists to make astrology look respectable.", since the field is so shattered by so much poor work, crappy understanding & (sometimes ignored) education and of course vested interests and their stupid models.

The amount of blame that Keynes gets today remains a good example. If all of Keynes would have been followed (as in pay it back during the good times, which has almost never been done), we couldn't be in the place we are. Don't get me wrong either, I'm not trying to defend all of Keynes since there's plenty of doofus things in his work.
I was just trying to give an example of how macro economics is so very full of ID 10 Ts with vested interests and poor or ignored educations.

I've moved more off into the bigger issues in the other social sciences, specifically the real psycho- and socio-paths that populate so many of the big banks, corporations and even government.
"They" are the ones that have basically caused what we have, at root.

 
At 7/21/2012 6:49 PM, Blogger VangelV said...

I certainly do admire the portion of the Straussian view that brings more of the other social sciences into economics, but I also confess to having not studied it much.

You really have to pay attention and be careful because not all Straussians seem to have been taught the same things. I recall a conversation with a professor that I used to argue with when he admitted that Strauss used to tell some of his students far less than he told the rest because not all were capable of understanding and some became useful propagandists for the cause. That said, it was the best course I ever took, although I was never actually registered, in university. Once you get certain insights you can predict and laugh what the empty suit 'experts' on the Sunday morning political shows will wind up saying. That helps as much as using Mises and Rothbard to see where the inevitable path will lead because it helps shelter oneself from the way the crises are handled.

 
At 7/21/2012 6:55 PM, Blogger VangelV said...

I'm still pretty much behind Galbraith's "Economics exists to make astrology look respectable.", since the field is so shattered by so much poor work, crappy understanding & (sometimes ignored) education and of course vested interests and their stupid models.

Isn't it amusing that Galbraith, who was an arrogant fool who knew very little about real world economics, could make such a statement when it describes him far more than it does those that he opposed?

The amount of blame that Keynes gets today remains a good example. If all of Keynes would have been followed (as in pay it back during the good times, which has almost never been done), we couldn't be in the place we are. Don't get me wrong either, I'm not trying to defend all of Keynes since there's plenty of doofus things in his work.
I was just trying to give an example of how macro economics is so very full of ID 10 Ts with vested interests and poor or ignored educations.


1. The Keynesians do not really say the same things that Keynes did.

2. That said, if you look at General Theory you find so much muddled thinking and contradictions that you can't take Keynes seriously. He was a very intelligent man who happened to be mistaken for an economist even though he was a very bad economist. To explain the success of Keynes it helps to understand Strauss. Those in power do not care about truth or logic. They care about power and an excuse to stay in power. Keynes was accepted and honoured because he gave the central planners what they wanted; legitimacy for their hunger for power.

 
At 7/21/2012 6:59 PM, Blogger VangelV said...

I've moved more off into the bigger issues in the other social sciences, specifically the real psycho- and socio-paths that populate so many of the big banks, corporations and even government.
"They" are the ones that have basically caused what we have, at root.


But they were enabled by the Keynesians, monetarists, and all the other panderers to power. There is a symbiotic relationship between the parasitic bureaucrats and their parasitic sponsors as they live off the efforts of productive individuals in society. If the Straussians are right, when they break society and destroy the economy, they will seek even more power than they had before and will try to steal from those that could see what was happening to appease the ignorant who supported them without question.

 
At 7/21/2012 7:04 PM, Blogger bart said...

Of the GMU guys I have a lot of time for Russ Roberts, Donald Boudreaux, Peter Leeson, Peter Boettke (who is an Austrian), Bryan Caplan, and (at times) Tyler Cowen

I'll have to check out some of their writings, although I'll probably leave out Caplan since he's too extreme in the anarchist vein for my taste. I'm hoping the GMU school isn't much into anarchism.

Mundell is too much of an "elite" for my taste too, although he does have the ears of many elites, especially on a global "NWO" currency area.

I continue to hope for more of a melding of the "total" money concept, which should include measures like M3 but also credit and debt and pretty much anything else that's actually used as a medium of exchange. Limited money measures like TMS or AMS are fine, as long as it is clearly understood that they are limited in scope.

 
At 7/21/2012 7:09 PM, Blogger bart said...

You really have to pay attention and be careful because not all Straussians seem to have been taught the same things.

Yep, I always have my "splatter shields" up and try to dig until I either hit pay dirt, or just that brown smelly stuff.

My prior example of the horrific implementation of Keynes (not paying it back in good times, and then blaming Keynesianism) sounds quite similar.

 
At 7/21/2012 7:17 PM, Blogger bart said...

Isn't it amusing that Galbraith, who was an arrogant fool who knew very little about real world economics, could make such a statement when it describes him far more than it does those that he opposed?

It appears that we still mildly disagree about him. Although he was certainly not stellar, I find that much of what he said rings true. For me, he frequently brings economics down out of the clouds and out of the ivory towers.


"Genius is a rising stock market."


"To see economic policy as a problem of choice between rival ideologies is the greatest error of our time."
-- "Money: Whence It Came, Where It Went", 368

"Faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy on the proof."


"The privileged have regularly invited their own destruction with their greed."
The Age of Uncertainty

"For a long the the New York Stock Exchange looked with suspicion on the investment trusts; only in 1929 was listing permitted. Even then the Committee on the Stock List required an investment trust to post with the Exchange the book and market value of the securities held at the time of listing and once a year thereafter to provide an inventory of its holdings...
It is difficult not to marvel at the imagination which was implicit in this gargantuan insanity. If there must be madness something may be said for having it on a heroic scale."



"A point must be repeated: only the pathological weakness of the financial memory...allows us to believe that the modern experience of....debt...is in any way a new phenomenon."
"A Short History of Financial Euphoria"


"The process by which banks create money is so simple that the mind is repelled."

 
At 7/21/2012 7:25 PM, Blogger bart said...

1. The Keynesians do not really say the same things that Keynes did.

2. That said, if you look at General Theory you find so much muddled thinking and contradictions that you can't take Keynes seriously. He was a very intelligent man who happened to be mistaken for an economist even though he was a very bad economist. To explain the success of Keynes it helps to understand Strauss. Those in power do not care about truth or logic. They care about power and an excuse to stay in power. Keynes was accepted and honoured because he gave the central planners what they wanted; legitimacy for their hunger for power.


We pretty much agree, especially on how he (intentionally or not) brought tools to the elites and psycho type power/control freaks.


But again, he did have some good points and truths like Galbraith, especially in his earlier works.



"There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million can diagnose."
-- "Economic consequences of the peace"- Unseen Hand, page 57



"A sound banker, alas, is not one who foresees danger and avoids it, but one who, when he is ruined, is ruined in a conventional way along with his fellows, so that no one can really blame him."
-- "Consequences to the Banks of a Collapse in Money Values", 1931



"The market can stay irrational longer than you can stay solvent."





Even this one (from "The General Theory of Employment, Interest, and Money"), while inadvertently skewering himself, shows that he understood that on very the long term, ideas trump vested interests.


"The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas... [S]oon or late, it is ideas, not vested interests, which are dangerous for good or evil."

 
At 7/21/2012 7:27 PM, Blogger VangelV said...

I'll have to check out some of their writings, although I'll probably leave out Caplan since he's too extreme in the anarchist vein for my taste. I'm hoping the GMU school isn't much into anarchism.

Actually, as you get older and do more reading you will find, as JRR Tolkien did, that anarchy, in the American sense rather than the European men-in-beards-throwing-bombs fashion, is the best and most moral of political philosophies. If you have the time you might want to listen to Jeff Riggenbach's talk about that. I recommend it highly. My kids certainly enjoyed the lecture and the knowledge that it gave them.

I continue to hope for more of a melding of the "total" money concept, which should include measures like M3 but also credit and debt and pretty much anything else that's actually used as a medium of exchange. Limited money measures like TMS or AMS are fine, as long as it is clearly understood that they are limited in scope.

I just want governments to get out of the way and let the markets choose whatever they want to use as money.

 
At 7/21/2012 7:35 PM, Blogger VangelV said...

It appears that we still mildly disagree about him. Although he was certainly not stellar, I find that much of what he said rings true. For me, he frequently brings economics down out of the clouds and out of the ivory towers.


I take it that you never met Mr. Galbraith. He was the most arrogant and vile asshole that I have ever had the displeasure to deal with in a university setting. He was full of himself even though he knew that his narrative, which sounded reasonable, was totally wrong. He flew into a rage when I asked him at a talk why it is that the Keynesians missed the possibility of stagflation when other economists explained and predicted it. And he humiliated some idiot student who seemed to worship him but managed to get one of his ideas a bit mixed up.

"Genius is a rising stock market."


"To see economic policy as a problem of choice between rival ideologies is the greatest error of our time."
-- "Money: Whence It Came, Where It Went", 368...


The fact that he could turn a phrase and had a nice way with words did not make him a very good economist. For most of his life he was just an activist much like Krugman is now and even Milton was for a chunk of time. But when choosing between Galbraith and Friedman it is no contest even though I have trouble with some of Freidman's ideas about money and detest his methodology and moral relativism.

 
At 7/21/2012 9:29 PM, Blogger bart said...

... that anarchy, in the American sense rather than the European men-in-beards-throwing-bombs fashion, is the best and most moral of political philosophies.

It certainly may be better in a philosophical sense, but it has been tried in many forms and many ways over the millennia and has never worked other than in small groups.

I did download the lecture and will listen to it within the next few days.



I just want governments to get out of the way and let the markets choose whatever they want to use as money.

I'd settle for much fewer psychopath types, since it would likely produce similar or even better effects.

 
At 7/21/2012 9:43 PM, Blogger bart said...

I take it that you never met Mr. Galbraith. He was the most arrogant and vile asshole that I have ever had the displeasure to deal with in a university setting.

My father did, and had a very different and positive impression and opinion of him.


The fact that he [Galbaith] could turn a phrase and had a nice way with words did not make him a very good economist.

I never said that he was some stellar economist, but he certainly wasn't awful. I much prefer Friedman.

His various books do have much that rings true, and he brings in much more of the humanities than economists of his day, and those before too.

I've found that many find him way more readable and actually educational, and that they come out of it with a way better overall understanding of economics - and much more willing to tackle books like "The road to serfdom".

 

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