Keynesian vs. Austrian economics made simple – Good analogy?

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  • Wed, Jun 23, 2010 - 01:31pm

    #11
    Peak Prosperity Admin

    Peak Prosperity Admin

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    Re: Keynesian vs. Austrian economics made simple – Good …

Keynesian and Austrian economic theories are brothers under the neoclassical belief system.  They have much more in common than differences as both are forms of feudalism.  Neither is a science, both ignore sovereign money and both totally miss the exponential growth of debt as explained in the Crash Course.  They both miss the fact that our current system cannot be sustained, it is inherently flawed as a mathematical certainty. 

Science, math and concerns for humanity left economics early in the 1900’s as wealthy foundations heavily funded the big three neoclassical schools: Mises, Marx, and Keynes.

“Many readers may be surprised to learn the extent to which the Graduate Institute and then Mises himself in the years immediately after he came to United States were kept afloat financially through generous grants from the Rockefeller Foundation. In fact, for the first years of Mises’s life in the United States, before his appointment as a visiting professor in the Graduate School of Business Administration at New York University (NYU) in 1945, he was almost totally dependent on annual research grants from the Rockefeller Foundation.” – Richard M. Ebeling, The Life and Works of Ludwig von Mises

More information can be found direct from the source from Murray Rothbard’s biography of Ludwig von Mises and an article published at the Ludwig von Mises Institute.  The William Volker Fund and Rockefeller Foundation funded people like Ludwig von Mises, Henry Hazlitt, and Murray Rothbard to promote a gold standard so that the bankers could manipulate the supply of currency and easily cause cycles of inflation and deflation to bankrupt the people.

“Because of Mises, Marx, and Keynes, we’ve allowed ourselves to become ignorant and brainwashed masses, losing our understanding of economics, cheerleading the people who enslave us, and losing our understanding of the greats like Moses, Cicero, Jesus, George Washington, Thomas Jefferson, Thomas Paine, Abraham Lincoln, Henry George, Ghandi, and MLK, who worked to free us from the tyrants, the ruling elite, the aristocrats, the slave owners, the monarchs, the robber barons, the monopoly men, the banking elite, and the corporate elite.”

It is very easy to debunk the big three neoclassical schools by asking yourself an easy question…if the people and property of the United States solely backs up our money; why do we as a nation borrow it from private banks that create it for free?

Nichoman, I’m a big fan of Lord Acton as he understood what we are confronted with today when he said “The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.”

Larry

  • Wed, Jun 23, 2010 - 03:39pm

    #12
    Peak Prosperity Admin

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    Re: Keynesian vs. Austrian economics made simple – Good …

[quote=DrKrbyLuv]

<snip>

Science, math and concerns for humanity left economics early in the 1900’s as wealthy foundations heavily funded the big three neoclassical schools: Mises, Marx, and Keynes.

<snip>.

<snip>.

Nichoman, I’m a big fan of Lord Acton as he understood what we are confronted with today when he said “The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.”

Larry

[/quote]

Agreed.  Economics is not a science in multiple ways.  

The most overarching…”Conservation of Mass/Energy”.   Will leave it at that.

Then…lack of following the essence of science:  

1. observation >>> 2. data >>> 3. analysis >>> 4. findings >>> 5. conclusions >>> 6. verification.   Then proceed back to step 1.   

The most profound agreement have always had with CM is facts versus opinion.   Long have held opinion(s) are irrelevant.  Facts/Data along with proven principles and processes are the keys (this may loosely fall into CM’s Beliefs).

Does economics, the so-called “expert”s and most schools do this?   BTW…have rejected being called an expert for over 20 years (opinion and unscientific).  At least Austrian references human behavior.  My take of economics is more akin to “Efficacy Economics” or most bang for the buck.

Mathmatics.  Is incomplete…much less misapplied or not applied at all (as is most obvious in economics)   Example:  By definition…Energy described in a Hamiltonian framework is inconsistent with its properties.  Then we can delve into Quantum aspects and so on.   That’s where I research things like String Theory and Einsteins other theory…often called “Plank-Bose-Einstein Theory of Heat Capacity” as new frontiers.   Seen too many results that we’ve confirmed that can’t explain adequately.   Then consider infamous “Two-Slit Experiment”. 

Lord Acton…was wise in many ways.   Wish more would study him.   His relationship with Gladstone still looking into…then trying to frame in context of the times of mid/late 1800 England, most notably they were still accessing lots of (plentiful) natural resources and a still evolving society.        

 

Nichoman

  • Tue, Nov 09, 2010 - 07:44am

    #13
    Peak Prosperity Admin

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    Re: Keynesian vs. Austrian economics made simple – Good …

Thank you for your info Nichoman. Very admirable areas you are working into.

Let me check on that link you have provided. Anyway, to revive an economy during a downturn, Keynesian financial aspects dictates that government must spend when consumers will not. In Britain, where John Maynard Keynes was born, the government is pulling back in a way that would raise strong objections from its native son. The rejection of Keynesian economics in Britain and a U.S. economy slow to respond to stimulus has conservatives in the United States celebrating the demise of Keynes’ philosophy. I, too, am not a believer that Keynesian economics will alleviate us from our current situation.

  • Tue, Nov 09, 2010 - 07:48am

    #14
    Peak Prosperity Admin

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    Re: Keynesian vs. Austrian economics made simple – Good …

Thank you for your info Nichoman. Very admirable areas you are working into.

  • Tue, Nov 09, 2010 - 12:07pm

    #15
    Peak Prosperity Admin

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    Re: Keynesian vs. Austrian economics made simple – Good …

I’d say confiscating private property (gold) by edict constitutes government intervention.    Executive Order 6102 and Gold Reserve Act are not theories.  The US Treasury  holds title to all gold held by the federal reserve, not some bank.

US Bonds paid in US Dollars which were convertible to gold, as well as bank notes and federal reserve notes.   The tie to gold put a check on government borrowing,and spending (FDRs New Deal programs) but it also left banks vulnerable to bank runs.     Removing gold from circulating as money was the final solution. 

  • Fri, Jun 03, 2011 - 04:18pm

    #16
    CriticalTheory

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    Because of Mises, Marx, and Keynes

Larry, excellent post!

As much as the big three names mentioned have been talked about in the present era. I think most miss the fact that that economic thought and social engineering are fingers of the same glove.

Misess’ book Socialism: An Economic and Sociological Analysis not only delves into how truly free markets are surperior than those of socialism. It even delves into marriage and free sex in how it relates to the aformentioned style policies.

I am a high school drop-out, completely void of any formal education. But in recent years have spent my time reading various opinions and ideals from the French Revolution to present day. And it’s amazing to me how little we as a nation (US) have learned from then to now.

Imagine if Andrew Mellon were the Secretary of Treasury now instead of Geitner? You have to ask yourself, would the current economic situation be nearly as stagnant?

With the economy in it’s current conditions, I find these discussions of Keynes vs. Hayek and the like very infomitive and interesting.

Uncle Ben Parker – “With great power comes great responsiblity”


 

  • Sun, Jun 05, 2011 - 12:17pm

    #17
    pwchinacat

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    Keynesian vs Austrian Economics Rap

You may have seen this but if not it’s pretty good.

 

  • Sun, Jun 05, 2011 - 04:25pm

    #18

    Johnny Oxygen

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    Here is the follow up

  • Sun, Jun 05, 2011 - 06:23pm

    #19

    Mary Aceves

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    fantastic

Love it

  • Sun, Jun 05, 2011 - 09:10pm

    #20
    land2341

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    it’s not an either/or proposition

This is where I keep getting hung up.  Systems are not static.  All systems,  of mechanics, mathematics, politics and thought are ever in motion.  And because all systems are created and applied by human they are inherently flawed.  

Economic systems are among the worst because they ALL are social engineering masquerading as science all the while disregarding the most basic ingredient of social engineering – humans.  Behavioral economics is taking a great step in that direction and helping,  but when will people see?  

You support Keynes when Mises is out of control and Mises when Keynes gets out of control.  They will ALL get out of control and push too far.  Neither one of them are “correct” or “true” or even better or worse.  Deviance defines the norms by forcing us to set them not by being allowed to become them.

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