Ever since the dying days of the lame duck Bush administration, federal officials and their friends at the Fed have been chanting incantations from the Book of Lord Keynes in a frantic effort to “stimulate” the U.S. economy. Like voodoo priests convinced of their power, these Keynesians aren’t going to let actual results get in the way of their faith in voodoo.
The U.S. government announced this morning that job growth in the country was the worst last month that it’s been since 1945. There were zero net jobs created in the country. The situation is bad and getting worse. Once again, we see that the voodoo economics of Keynes doesn’t work. It never has worked even once, but its practitioners won’t be dissuaded from their faith.
I can almost write the response from people such as Paul Krugman. I haven’t seen a statement from him yet, but it’ll probably be something along the lines of this: “The government hasn’t yet spent enough money to stimulate the economy. It’s not that we’re doing the wrong things. It’s that the Obama administration is kowtowing to Republicans by failing to spend enough. If we would just spend more money — on digging ditches or gearing up to fight off an alien invasion, for instance — there would be no more problem.”
That’s the way these people think. They don’t understand the real world. They don’t understand real people. They only understand mathematical models based on flawed assumptions. The fact that their predictions and prescriptions have been wrong over and over and over (under both Republican and Democratic presidents) and they still won’t question their faith is evidence that there’s something wrong with their thinking.
If you’d like to understand reality, you need to look to the only economic school of thought that has consistently been able to correctly predict what was going to happen with the economy — those of the Austrian school. Take the time to read ideas that go against what you’ve been taught. You might find that there are some people who do know what to do. It’s just that nobody will listen to them — because their ideas would stop politicians from having control.
Get to know the people and ideas of the Ludwig von Mises Institute, for instance. You might be surprised at how much sense economics can make.