Postmodern Monetarism: Supply-sider turning Keynesian

Peter Kilander peterk at
Tue Dec 29 19:36:31 PST 1998

>Some one praised on a earlier post former Fed Gov Lawrence Lindsey, a
>fervent supply-sider, for arguing for an across-the-board 10% tax cut to
>"put $70 billion in the hands of consumers," to spur them to keep buying
>more while saving less ( The Wall Street Journal, December 9),
>notwithstanding consumer debt and defaults being at all time highs. It
>sounds like a typical Keynesian idea to me.

Henry, Apologies for being a couple of days late on this. I had posted the message about Lindsey but didn't praise him. Maybe someone else had. I said he seemed unaware of class issues. Trickle down economics doesn't work as advertised.

In the London Review of Books, Perry Anderson has a piece on what's going on in Germany. In it he says:

Just such a fork in the road has now materialised - and in dramatic circumstances: on the one hand, an unprecedented concert of centre-left governments, with no serious impediment or excuse for inaction from the Right and, on the other, the worst global economic crisis since the Thirties. The new Social-Democratic Europe headed by Germany has an enormous opportunity. But without a real answer to the crisis, disaster could lie in wait. Mere Keynesian solutions - all that have been aired so fair - might meet the Hayekian problem. But they are unlikely to cut the Marxian knot: the underlying over-competition in the productive economy from which orthodox opinion, in search of purely financial explanations of the crisis, still looks away.


>What do Marxist economists and their liberal economists dancing partners
>on this list have to say about this coalition of strange bedfellows.
>Are we seeing dialectics at work? Are these traditional labels
>inoperative in a new conceptual synthesis? Is this postmodern
>Monetarism or deconstructed Keynesianism?
>There is a lot of rumbling in the globalized Street that the major
>reason the Asian, Russia, Brazilian crises did not caused a sustained
>panic in the stock market was that practically all government economists
>have turned Keynsean. Is that an accurate assessment?
>Some even go as far as saying that speculative stock markets completely
>detached from the realities of the global economy, operating like
>gambling casinos in Las Vagas, can themselves be economic stimulants
>that keep the bubble going, that it is good economics to exchange future
>pain with current euphoria, because theoretically, tomorrow will always
>be tomorrow in this Goldilock economy.
>Not being a Marxist, although much indebted to marxist ideas, and not
>being a trained economist, but being in constant need of a better
>understanding of this mercurial discipline, I would like to put the
>following to the specialists or any one who has an informed opinion:
>If Marxist economists were heading up the Council of Economic Advisors,
>what policy measures would they propose in the current situation?
>Henry C.K. Liu

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