Keynesian Economics VS The Austrian School Of Economics

Who wins?

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[cyborganic99]

you dont read much of keyens's work do you? not much of what you label as keynesian economics is not keyensian economics. do your homework before you label all regulation as keyensian style economics.

[Premier112]

@lubicuslatinae "the negative consequences of the free market that we have seen in the Industrial revolution, such as child labor,"

What do you mean, such as child labor? Do you mean to  suggest child labor was less before the industrial revolution and grew as it continued?

I think you mean, thank you Industrial Revolution, for creating a social/productivity environment where kids could go to schools.

"dangerous working conditions"

Do you mean, people having work? And thus, work conditions?

[witzerdog]

@lubicuslatinae I believe the government regulation Austrian Economist is against are not safety/social regulations, but regulations revolving subsidies, bailouts and unnaturally incentivizing industry though tax benefits and government spending.

[lubicuslatinae]

I have a question. If the best way to have an economy is to use Austrian free market systems, with no governmental regulations, then how can people in such a system be protected from the negative consequences of the free market that we have seen in the Industrial revolution, such as child labor, dangerous working conditions, and how can people be protected from negative effects of corporations, such as power being concentrated on a small group of individuals

[H2J0E]

@jjrglobal I am curious as to why you would choose 1947? In 1948 our GDP actually got worse (from 269.2 to 267.3) and unemployment rose from 3.8 to 5% over the next three years. '47 seems like a strange year to pick as the end of the depression considering you have an entire decade of tremendous growth.

[jjrglobal]

@H2J0E

GDP is a piss poor measure to determine the well being of a nations citizenry because it includes government spending. The USSR had GDP growth too, so what? Were the people better off because of high GDP numbers?

[H2J0E]

@jjrglobal From 1938 to 1945 the GDP grew every, let me repeat "every", year from 86.1 billion in '38 to 223.1 billion in '45. That's a 259.1% increase!!! Unemployment dropped "every" year during that same period from 19% to 1.2% (btw, lowest in US history) and taxes were raised from 63% to over 90%.

You call massive economic growth like that a "depression"? That is very interesting logic you are using for your economic argument. LOL

[jjrglobal]

@H2J0E

The depression didn't end until 1947, the stock market didn't reach 1929 level until 1952

[H2J0E]

Thanks for the video WorldTravler. Couldn't it be argued that we are having our current economic problems because of Austrian style economics"AE" and our departure from Keynesian econ "KE"? Most would agree that the housing bubble was caused, at least in part, by the Gramm-Leach-Bliley Act. This deregulation of banking falls right under the philosophies of AE. Add in the tax cuts that created a massive wealth concentration (Keynes argued would cause bubbles) and we have today's economy.

[H2J0E]

@jjrglobal Problem with your 3 points. 1) FDR was alive. Died in 1945, depression over by 1939 (ok, some say '33) 2) See #1 and facts below 3) Taxes raised (not cut) during GDP growth and fast drop in unemployment Year = GDP / Unemployment Rate / Top Tax Rate: 1933 = 56.4 / 19% / 63% 1938 = 86.1 / 19% / 79% 1939 = 92.2 / 15.5% / 79% 1940 = 101.4 / 14.6% / 81% 1941 = 126.7 / 9% / 81% 1942 = 161.9 / 4.7% / 88% 1944 = 219.8 / 1.2% / 94% (top tax stayed above 91% until 1963)