Keynes vs. Hayek Rap Battle

[Misterveritis]

A good while back I ran across a pretty fantastic video series comparing the arguments of Keynes and Hayek.

I believe the video pretty accurately sums up the arguments on both sides.
Who here supports Hayek, and who Keynes, and why?

Hayek. The extended order occurs even though we do not understand why. I side with people who choose their way for their reasons. I choose against those who take money from one to give it to another.

Thank you for offering this. I will watch the rest of the videos.

 

[Misterveritis]

I'm a Keynesian. The market is volatile and contracycle spending is necessary to minimize the human costs of that volatility.
Of course, when I say I'm Keynesian, that also means I believe in the government actually running budget surpluses during boom years.

But of course, in fairy tales occasionally there is a happy ending. Not so with government.

 

[Misterveritis]

That's a nice assertion, but it's an unfounded one. Markets have always boomed and busted naturally, with or without government intervention.



Agreed. But I don't want a free market, for many reasons including this one.

The free market just means that you get to choose for you and I get to choose for me. I am fine with you giving up your right to choose for you. I am opposed to anyone forcing me to give up my right to choose for me.

 

[Misterveritis]

What you call "free" markets often collapse with disasterous results. We have learned how to control those disasters with regulation, so the majority don't suffer consequences they had no part in.
Not using our brains is not an option.

I really, really want to say, "It seems to work for...". No. I am not going to say it. You cannot make me say it. I refuse to say it!

 

[Misterveritis]

The Road to Serfdom. Educate yourself.

http://www.cblpi.org/ftp/Econ/RoadtoSerfdom_ReadersDigest_and_Cartoon_Versions.pdf

 

[Misterveritis]

I read that a while back. Probably, there are many smart ideas in it, but I disagree with his big picture. The claim that anything that's not a laissez-faire free market system will inevitably lead to totalitarianism is way too steep, IMO.

The term free market is shorthand. It means you get to choose for you and I get to choose for me. Every other path tends to lead to tyranny. When we do not get to choose for ourselves how could there be any other outcome short of tyranny?

 

[samsmart]

A good while back I ran across a pretty fantastic video series comparing the arguments of Keynes and Hayek.



I believe the video pretty accurately sums up the arguments on both sides.

Who here supports Hayek, and who Keynes, and why?

I'm a believer in the monkeysphere

Dunbar's number - Wikipedia, the free encyclopedia

I think that as businesses get larger, they should be required to submit to greater and greater legislation in order to regulate their impact on society and the environment because what such businesses do has greater and greater consequences for society and the environment.

 

[samsmart]

The term free market is shorthand. It means you get to choose for you and I get to choose for me. Every other path tends to lead to tyranny. When we do not get to choose for ourselves how could there be any other outcome short of tyranny?

Except you don't get to choose for yourself is unethical practices by one business causes it to develop a monopoly on a good or service.

So, in order to have free markets of the kind you mentioned, a government must be about to regulate the markets to ensure that businesses keep them free.

This was the reason for the trust-busting by progressive Republicans and Democrats of the late 19th and early 20th centuries.

 

[German guy]

The term free market is shorthand. It means you get to choose for you and I get to choose for me. Every other path tends to lead to tyranny. When we do not get to choose for ourselves how could there be any other outcome short of tyranny?

You could argue that material inequality can be a worse tyranny than qualifying the right on property.

For example, hunger is a bigger tyrant than a government taxing a few percentages of your income, when you have enough left.

I don't quite understand how people can set the right on property so absolute, and consider any qualification of it, no matter how moderate or reasonable, "tyranny".

 

[RabidAlpaca]

What you call "free" markets often collapse with disasterous results. We have learned how to control those disasters with regulation, so the majority don't suffer consequences they had no part in.
Not using our brains is not an option.

Oh? And how well have the crashes of the last 100 years since the creation of the federal reserve been for us? If I recall, we've had the worst in our history.

Except you don't get to choose for yourself is unethical practices by one business causes it to develop a monopoly on a good or service.

So, in order to have free markets of the kind you mentioned, a government must be about to regulate the markets to ensure that businesses keep them free.

This was the reason for the trust-busting by progressive Republicans and Democrats of the late 19th and early 20th centuries.

Having a base set of rules enforced by the government is necessary for a free market. However, what we're talking about here is the government controlling large sectors of the market.

- Pumping cash into industries it chooses
- Wage controls
- Price controls
- Buying crops that no one else wanted, then letting it sit there and rot

There is a HUGE different between the government setting the rules of the game as the moderator, and jumping in and being a contestant.

You could argue that material inequality can be a worse tyranny than qualifying the right on property.

For example, hunger is a bigger tyrant than a government taxing a few percentages of your income, when you have enough left.

I don't quite understand how people can set the right on property so absolute, and consider any qualification of it, no matter how moderate or reasonable, "tyranny".

You could certainly argue that, but it doesn't hold up under observation. I'd like to see how the government's controlling of the market by pumping in cash where it pleases is helping anybody at all. They pumped funds into the housing market to help create the housing bubble. Government interference in the market is near an all time high, and yet unemployment is still high, bankers are still super rich, and the poor are still unbelievably poor. Except this time around the poor have an underwater mortgage.

 

[German guy]

You could certainly argue that, but it doesn't hold up under observation. I'd like to see how the government's controlling of the market by pumping in cash where it pleases is helping anybody at all. They pumped funds into the housing market to help create the housing bubble. Government interference in the market is near an all time high, and yet unemployment is still high, bankers are still super rich, and the poor are still unbelievably poor. Except this time around the poor have an underwater mortgage.

Of course government interference isn't always good. There are smart and reasonable ways to do it, and stupid ways to do it. I had the successful example of the (West-)German "Social Market Economy" in mind: With this model, you combine economic strength with a moderation of inequality. On the Gini index, Germany doesn't score bad with that model:

Gini coefficient - Wikipedia, the free encyclopedia
(Notice that France, although it arguably has more government interference on the markets, has a lower rating.)

And this model also seemed fit to make Germany the strongest European economy during the economic crisis.

 

[RabidAlpaca]

Of course government interference isn't always good. There are smart and reasonable ways to do it, and stupid ways to do it. I had the successful example of the (West-)German "Social Market Economy" in mind: With this model, you combine economic strength with a moderation of inequality. On the Gini index, Germany doesn't score bad with that model:

Gini coefficient - Wikipedia, the free encyclopedia
(Notice that France, although it arguably has more government interference on the markets, has a lower rating.)

And this model also seemed fit to make Germany the strongest European economy during the economic crisis.

Excellent. I've never seen the gini coefficient before. I'd like to find a chart of gini coefficient vs tax rates to see if there's any clear correlation.

 

[German guy]

Excellent. I've never seen the gini coefficient before. I'd like to find a chart of gini coefficient vs tax rates to see if there's any clear correlation.

My guess is that there is no direct correlation. I could be wrong, but probably the countries with the lowest and highest tax rates score worst.

 

[RGacky3]

Problem is, Obama hasn't been following a Keynsian approach the way Kaynes would have put it, he's feel following the neo-keynsian system that basically just mixes some keynsianism with neo-classical systems.

 

[Ikari]

To be totally honest I heard he was one of those anti government Austrian economic types and I saw no need to seek out anything of his to read. I have read plenty on economics but it is pretty dry stuff to read authors you know you are going to disagree with.

Then again, how many of those libertarian types have read "The Affluent Society"? I mean, it is only natural we seek out things that we already know we are going to agree with.

I think it's important to research these ideas as the actual solution to the dynamic is typically one requiring portions of multiple philosophies. Such as here. While I support Heyek, I do not support the pure laissie faire style economy he envisions. But a lot of his base arguments, I would say is correct and fundamentally his ideals on how the economy works I would say are the most rational and closest to the actual dynamic. What I really don't like about Keynes is that he's a growth sort of guy. Heyek is more employment. Growth is great, but growth doesn't necessarily mean unemployment is going down or that the people are spending more of their money by their choice and driving new demand. Growth is just a number in a list of other numbers. Government can spend, stock market can churn, growth can be "achieved", but the people can still be hurting and not getting the help they need and growth will keep overlooking that.

This is, BTW, why the mandate to the Federal Reserve is to balance Inflation and Unemployment, not Inflation and Growth.

No, I think I am a "min-Heyek-ist". As little regulation as you can get away with in the markets (though it will be greater than zero). The free market, like the free state, requires a small but proper amount of regulation.

 

[pdog]

Are you kidding? Ol' Helicopter Ben Bernanke is part of the hardcore Keynesian school of hard knocks. He's got it tatted across his chest and knows the secret handshake and everything.

Monetary policy is only half of the equation. Keynes would be rolling in his grave if he saw tax breaks and high spending in one half of a cycle and then bitching about deficits in another cycle. Viktyr was right about not following any economic principles - we change economic theories around political cycles, not economic cycles.

 

[pdog]

They have always boomed and busted naturally, but government manipulation tends to prolong them, rather than letting natural cycles happen. The market self-corrects very efficiently, with minimal damage, if it is left alone to work. The only legitimate government needed is to assure fairness in the market, via regulations which are consistent and standard, and do not change in response to the ups and downs.

I'm not sure how you'd arrive at this. Even if markets rose faster with larger surpluses of labor, you'd have to explain a rise with reduced consumption in those same periods. The cycles will always be there, the only question is do we flatten the peaks and troughs with public labor.

 

[iguanaman]

Oh? And how well have the crashes of the last 100 years since the creation of the federal reserve been for us? If I recall, we've had the worst in our history.


Having a base set of rules enforced by the government is necessary for a free market. However, what we're talking about here is the government controlling large sectors of the market.

- Pumping cash into industries it chooses
- Wage controls
- Price controls
- Buying crops that no one else wanted, then letting it sit there and rot

There is a HUGE different between the government setting the rules of the game as the moderator, and jumping in and being a contestant.



You could certainly argue that, but it doesn't hold up under observation. I'd like to see how the government's controlling of the market by pumping in cash where it pleases is helping anybody at all. They pumped funds into the housing market to help create the housing bubble. Government interference in the market is near an all time high, and yet unemployment is still high, bankers are still super rich, and the poor are still unbelievably poor. Except this time around the poor have an underwater mortgage.

Allot of "investors" pumped up the subprime markets not just the Govt. And it wasn't the Fed it was the executive branch that did most of the Govt. work when Bush "pumped" $440 Billion out of Fannie Mae to buy subprimes. Far from being at all time highs, regulations and scrutiny were at 75 year lows because of the repeal of Depression era laws governing banks and insurance companies and the bankers got super richer....on that point you are correct.

 

[RabidAlpaca]

Allot of "investors" pumped up the subprime markets not just the Govt. And it wasn't the Fed it was the executive branch that did most of the Govt. work when Bush "pumped" $440 Billion out of Fannie Mae to buy subprimes. Far from being at all time highs, regulations and scrutiny were at 75 year lows because of the repeal of Depression era laws governing banks and insurance companies and the bankers got super richer....on that point you are correct.

Don't get me wrong, the banks were very largely responsible for the crash. However, the government had it's dirty hands all over the situation as well. Glad we can agree on that.

 

[Geoist]

I support the Henry George side. But if I had to choose it would be Hayek.

 

[Geoist]

What you call "free" markets often collapse with disasterous results.

Land speculation is a huge contributor to those collapses. I am for a free market, when we have the right tax system in place.

 

[Misterveritis]

Except you don't get to choose for yourself is unethical practices by one business causes it to develop a monopoly on a good or service.

So, in order to have free markets of the kind you mentioned, a government must be about to regulate the markets to ensure that businesses keep them free.

This was the reason for the trust-busting by progressive Republicans and Democrats of the late 19th and early 20th centuries.

Monopolies nearly always exist because of government actions. You have it wrong. Completely wrong.

 

[Misterveritis]

You could argue that material inequality can be a worse tyranny than qualifying the right on property.

No. I couldn't. But I am certain you could. And you really want to.

For example, hunger is a bigger tyrant than a government taxing a few percentages of your income, when you have enough left.

No. It isn't. Let to its own devices hunger has a way of motivating people to work or perish. Most will choose to work.

I don't quite understand how people can set the right on property so absolute, and consider any qualification of it, no matter how moderate or reasonable, "tyranny".

If you do not have a right to own property then you are not free. You are an object to be used and discarded by the state. Once the right to own property is a qualified right, meaning the state decides what property you may have, then tyranny has already started and the end will come.

 

[German guy]

No. I couldn't. But I am certain you could. And you really want to.


No. It isn't. Let to its own devices hunger has a way of motivating people to work or perish. Most will choose to work.


If you do not have a right to own property then you are not free. You are an object to be used and discarded by the state. Once the right to own property is a qualified right, meaning the state decides what property you may have, then tyranny has already started and the end will come.

Well, I guess we then just have to agree to disagree.

My point is that freedom does not fill your belly. But I don't think you have to give up freedom to fill your belly. No need to take everything to the extreme.

 

[ecofarm]

everything to the extreme.

Anything to the extreme, moderate.