In response to:

Is Anybody Surprised that Krugman Was Wrong about U.K. Fiscal Policy?

Timgabz Wrote: Jan 24, 2013 8:59 AM
Keynesian policy is very valid. But people are blaming it like a person blaming a car whose engine fails rather than lack of maintenance. You can't cherry pick like politicians have been doing and not expect a vicious flashback that we are sitting with. Now they are trying to repeate the process and we are in deep trouble like a man trying to put out a fire with petrol. This thing called MMT , modern monetary Theory is crude justification of the current print their way out of problem...
George257 Wrote: Jan 24, 2013 5:05 PM
He did remark that he 'Wasn't a Keynesian', meaning that what was already being called Keynesianism, was not what he intended at all.
latebloomer Wrote: Jan 24, 2013 10:52 AM
I have heard some anecdotal evidence that Keynes belatedly recognized the flaws in his theory and was getting ready to refute or modify it at the end of his life, but ran out of time.
latebloomer Wrote: Jan 24, 2013 10:50 AM
Keynesian policy is valid IN THEORY. To oversimplify quite a bit, the basic idea is that government can smooth out the peaks and valleys of normal economic activity with public sector spending in the low points, building up surpluses during the boom periods to hold until needed. Unfortunately (and inevitably), this is completely at odds with both political reality and human nature- public sector spending never decreases, as politicians must use the funds to their advantage in order to remain in the public sector.

This is also why the well-intentioned (but myopic) on the left- as opposed to the venally cynical who like the system- think that it can work, if only "the right people" are put in charge.
FletchforFreedom Wrote: Jan 24, 2013 10:14 AM
On what planet is Keynesian policy "valid"? It has failed miserably as an economic predictor; it's prescriptions for economic recovery have never worked; it consistes of the same inflationary policies rejected long before Keynes came on the scene and couldn;t survive Hazlitt's critique more than 50 yeras ago to which a cogent response has yet to have been offered.

According to Keynesians, 1946 was to be a disaster greater than that of the Great Depression ... yet, of course, the opposite occurred.
VigilantWingnut Wrote: Jan 24, 2013 10:08 AM
I dunno, sounds to me a lot like the excuse that Socialism hasn't worked just because the right person hasn't been in charge yet, or Hitler's assertion that the Soviets were doing Socialism wrong. Socialism is simply unsustainable. You always run out of other people's money. Period.

Any system that relies on government as the car, the gas, the road, and the driver where citizens are just mere passengers on the State's Magical Mystery Bus will never be workable or sustainable.

johnm h Wrote: Jan 24, 2013 9:35 AM
You need to read Hayek on Keynes and on monetarists. His criticisms and contributions were lost when Keynesianism became a profitable fad for economists and politicians alike, but after 80 years of failure here and everywhere else Keynesian economics has been tried, folks are rediscovering the Austrians and finding that they nailed it 80 years ago.
upside22 Wrote: Jan 24, 2013 9:06 AM
But *REAL* Keynesian policy includes establishing pro-growth policies for the private sector as well as using government spending as a replacement for private demand. The Marxist Democrats have morphed this into a psuedo-Keynesian policy of -- "the government spending *is* the pro-growth policy".

Keynes would be mortified to see what the Marxist Democrats have done to his policy prescriptions!!!

Just like in the United States, politicians in the United Kingdom use the deceptive practice of “baseline budgeting” as part of fiscal policy.

This means the politicians can increase spending, but simultaneously claim they are cutting spending because the budget could have expanded at an even faster pace.

Sort of like saying your diet is successful because you’re only gaining two pounds a week rather...