IMF’s Disastrous Neo-Keynesianism Is ‘Groovy Idea,’ Says TNR
Wednesday, February 15, 2012 – by Staff Report
How the IMF Got Its Keynesian Groove Back … Two events in recent years put the IMF back on the Keynesian track: The 2008 financial meltdown, and the arrival of a new fund director, Dominique Strauss-Kahn. Under Strauss-Kahn’s leadership, the IMF grew into a bulwark against German caution and orthodoxy. “DSK really did change things,” Boorman tells me. “He is a brilliantly gifted politician and a very good economist. That allowed him to insert himself into the G20 process in November 2008. He seized the moment in a brilliant fashion. Any decisions that were going to be taken, the IMF was moved right into the center of them.” Some of Europe’s orthodox leaders argued for austerity. But, according to Kirkegaard, “the IMF got countries to put their feet on the Keynesian pedal.” – The New Republic
Dominant Social Theme: Keynes lives, and a good thing, too. Let statists celebrate everywhere.
Free-Market Analysis: The socialist John Maynard Keynes is once again having an impact on world finance, according to The New Republic, a leftist “thought” magazine. The New Republic is yet another mouthpiece for the Anglosphere power elite, like the Economist, New Yorker and Weekly Standard (to name a few).
Actually, Keynes, a favorite state economist of statists everywhere, never left. He is the patron saint of the modern, ruinous, central banking economy that has collapsed economies around the world. He was a covert and sometimes overt member of the socialist/fascist Bloomsbury Group and, even worse, the Fabian Society.
Keynes was an elitist, an economic trigger man for the small group of powerful families (and their enablers and associates) that runs the world’s central banks and are attempting to create global governance.
This tiny, inordinately powerful group is increasingly blatant and ruthless in its attempts at installing their New World Order. But throughout the past century or so, they’ve been inordinately careful to present the world with so-called intellectual justifications for their globalist plans.
Within this context, John Maynard Keynes, a man with obvious contempt for the world-at -large, was a valuable individual indeed. A math-o-phile, he had an uncanny knack for marrying absolutely turgid and incomprehensible prose to econometrics in order to come up with justifications for the most logically bankrupt economic conclusions.
He once met with Franklin Delano Roosevelt to go over his General Theory and so befuddled FDR with equations that the president later confessed he’d hardly understood a word that Keynes had said. And yet without further thought, FDR and his administration put Keynes’s theories into play. They basically became the economic law of the land, even though FDR may not have understood them.
FDR and his socialist minions used Keynes’s meretricious and complex theorems because they justified massive government and central banking interference in the marketplace. Keynes never explained how recessions and depressions came into being, so far as we can tell, but he knew the solution: Print lots of money is how his prescriptions have been applied in the modern era.
This was the “genius” of Keynes. When an economy’s “animal spirits” slowed, the government had the right – nay, the duty – to step in and manufacture employment. In Keynes’s view, the government could pay people to dig holes and fill them back up, anything that put people to work.
What Keynes was after was getting money to circulate again. He wanted the government to pay people so that they would be able to avoid poverty and to buy goods and services that would reignite the economy.
Keynes believed that the state should save for a “rainy day.” But in practice, what this has meant is that the state’s central banks have printed the money that the state has then used to “stimulate” the economy by paying people for make-work jobs.
In the case of the Obama administration – a regime with an institutionalized Keynesian bias – tens of TRILLIONS have been disbursed to prop up the central banking economy and its commercial and merchant banks and also to favored “green” industries, infrastructure boondoggles and other inefficient or useless enterprises.
It’s been estimated in some cases that a single job may cost hundreds of thousands of dollars of government money. Under Obama, the national debt has expanded dramatically and the amount of inflationary dollars that the Fed has printed is literally incomprehensible.
But all of this is “good” and “groovy” according to The New Republic. This is a magazine that promotes government activism on numerous levels. The staff of such thought magazines invariably argue for SOME sort of state involvement in the economy or in people’s lives generally.
This is because these publications have been set up to promote power elite points of view. They are part of a larger dialectic that must always advocate state power within some ambit. Without state power, the power elite has no mercantilist levers to pull and cannot hide behind the democratic process.
The power elite absolutely needs state activism and needs to create vehicles that advocate for state power. The International Monetary Fund is one such example of a facility that forcefully promotes interference in the marketplace as a way of ameliorating economic difficulties.
Ironically, as we pointed out yesterday, the more “right wing” publications like the Weekly Standard often argue for expanded military and civil policing authority while not paying too much attention to economic issues or the welfarist state.
But The New Republic is bad enough. And its defense of Keynesianism is intellectually bankrupt. There is no way round the larger issue of price-fixing when it comes to government interference in the marketplace.
The only entity that can determine how much money an economy needs is the market itself. Money must be privately circulated and subject to the laws of supply and demand. But Keynes’s anodynes have been utilized by government econo-crats as a justification for central bank management of the money supply.
These days, around the world, central banks determine the amount of money that an economy needs. The results have been an absolute disaster. As free-market Austrian economists have long pointed out, the overprinting of money leads to booms and disastrous busts.
Keynes’s prescription, reigniting the economy by injecting yet MORE money into the economy, merely prolongs the problems. But it suits the power elite just fine.
That’s because it gives the power elite the justification to print trillions of new dollars to prop up its failing and bankrupt financial entities. These entities NEED to fail so that people can differentiate between bankrupt facilities and healthy firms. But that’s not how it works anymore.
Thanks to Keynes – or the way that Keynes has been interpreted – the elites have used his General Theory as a justification for printing money, ruining economies, bankrupting honest businesses and propping up hundreds of failed and failing banking entities.
Keynes’s theories have been an unparalleled disaster. They have allowed the power elite to print money with impunity and to justify propping up its corrupt financial system. Today, the world reels from depression and economic inefficiency. This is a direct result of the justifications that Keynes provided the power elite via his crackpot econometrics.
The article in The New Republic lauding the IMF’s use of Keynesianism discusses none of the above of course. It doesn’t grapple with Keynes’s Fabianism, his contempt for ordinary people or the obvious failures of his general theory.
The IMF itself is a bankrupt institution with a deserved reputation for making bad economies worse and literally starving people to death in the process. The idea that one can marry the illegitimate monetary science of Keynesianism to the thuggery of the IMF and come up with something better than either of the two parts is in our view nothing but wishful thinking.
These articles are empyrean intellectual creations. They have little or nothing to do with real life. They pile on one fantasy after another of the way the world is supposed to work. But it doesn’t work that way.
Keynes was wrong in almost every aspect of his “General Theory.” The IMF has been a plague among impoverished nations for most of its existence. The best thing that could happen would be that both Keynes and the IMF would be erased from the annals of history.
Conclusion: Either one is horrible. Together, they are a terrible poison, responsible for misery and economic mayhem worldwide.
A young group of English intellectuals whowere active as writers, artists, art critics and economists made a huge impact on English society when they met for discussions in the Bloomsbury area of London after their college years in the early part of the 20th century.
The Bloomsbury Group shared a socialistic worldview and was in some sense an adjunct to the Fabian Society. However, the Bloomsbury focus on pleasure did, perhaps, put them at odds with the Fabians, who believed in active political subversion to bring socialism into society.
The best-known members of the group, John Maynard Keynes, Virginia Woolf, Lytton Strachey, and E. M. Forster, made numerous contributions to the literary world as well as the world of economics. In 1927, Woolf wrote a classic in gay fiction. The book argued that love and passion ignore gender.
Almost everything about Bloomsbury appears to be controversial, including its membership and the name. It is now generally accepted that the lives and works of the group members show an interconnected similarity of attitudes and ideas that helped to keep the relatives and friends within the group together.
They had firm convictions about the nature of human consciousness and its relationship with nature, and shared a fundamental belief about the separateness of individuals, which involves love as well as isolation. The 1920s were the golden years of the Bloomsbury Group. E. M. Forster completed A Passage to India, still the most highly regarded novel on English imperialism in India. Virginia Woolf wrote and published her most widely-read modernist essays and novels.
Art and philosophy would seem to be a “good.” But the elitism of the Bloomsbury Group and the high social position of its members helped make Britain into the chaotic and authoritarian society that it is today.
John Maynard Keynes virtually reinvented central banking, with all the destruction that it brings through its boom and bust cycles. Virginia Woolf, with her exquisite prose, provided an artistic endorsement for fundamentally totalitarian ideas. For those who believe in freedom and free societies, there is nothing much positive to say about the heritage of the Bloomsbury Group.
Much has been written about the Bloomsbury Group’s sexual idiosyncrasies, but these are merely a distraction from the real issue. The social and economic subversion performed by the Bloomsbury Group on behalf of the Anglosphere power elite and its central-bank dominated families continues to play out destructively today.
by the_IRF on 02/16/12 04:54 AM
Iraq War Will Untie Israel’s Hold On The World
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Posted by Danny B on 02/15/12 11:08 PM
“The wealthy and their advisers always act to preserve the status quo” NOT true.
Look at Argentina. The wealthy worked to preserve THEIR status quo. Fornicate the rest of the people.
Look at Hegel, Marx and Keynes. The world created in the mind of Marx did NOT include human motivation or other trifling influences.
Keynes may have been a mathophile but, he stupidly believed that a socialist GOV would save up during the good times.
The bonehead Hegel believed that the state would be your mother and your father and your god and your religion. He too was clueless about human nature. Now, the masses believe that the state is your rich-uncle and your sugar-daddy. Since you have a rich uncle, why even bother to push yourself,,, for anything. Why push your kids?
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That should work out REAL well in the long run.
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Hell yeah !! a groovy idea.
“Co-head of M&A at ROTHSCHILD NORTH AMERICA INC.”
Mergers and acquisitions,,, North America ??????????
Is there a subtle message here?
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Posted by seer on 02/15/12 03:01 PM
Partial truths are always disturbing to me, especially in Journalism; although I do not view this biased diatribe as journalism in its purist form in any sense of the word. Perhaps I am wrong as the DB clearly is biased towards one form of economic theory that is ignored by the mainstream economists. Keynes would have disagreed with the way the world economies have been handled; particularly the USA. In practice today there are no pure forms of communism, socialism or capitalism or Keynesian economics or any economic unit for that matter. The wealthy and their advisers always act to preserve the staus quo which obviously benefits them the most an unfortunately this happens at all levels of government to varying degrees.
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Reply from The Daily Bell
Free-marke Austrian economics is not a “partial truth” in our view. Maybe in yours …
Posted by Bischoff on 02/15/12 02:43 PM
“Either one is horrible [IMF and Keynesianism]. Together, they are a terrible poison, responsible for misery and economic mayhem worldwide.”
So why can “The New Republic” with a straight face call Keynesianism at the IMF to be “groovy”… ???
As the article explains, Keynesianism supports to power dreams of authoritarians. It appealed to FDR and to all those “bright” young staffers that flooded the FDR administration.
The real consequences of applying the Keynsesian hair-brained schemes installed by the FDR administration, such as the Federal Reserve central bank, are only now being felt in full force.
Keynes, an elitist, emotionally unstable, though mathematically brilliant individual, hardly believed in the validity of his own General Theory. At the beginning of WW I, he entertained bets at his college that the war wouldn’t last more than 6 month, as by then all the gold reserves of the warring parties would be exhausted, and the war would have to stop.
Of course, he was wrong. WW I was fought largely by fiat currency foisted upon the masses, and by European allies borrowing large amounts of gold from the United States.
Seeing the ability to dupe the masses with fiat money, it must have given Keynes the idea to suggest such effort could work to operate a peaceful economy. When someone pointed out that his theories could not possibly work in the longrun, Keynes replied that, “we all die in the long run”.
Groovy retort, indeed. Yet, most people find it funny, despite the fact that by following Keynesian and Friedmanite (“Keynes light”) theories, wholesale misery has been created for countless numbers of people.
Isn’t it astounding that those who seek power by propagandizing people, and by controlling their means of exchange and their savings responsible, can also manage to have the people think it all is “groovy”… ???
Are people happy to be treated just like mushrooms by being kept in the dark and feed lots of BS… ??? I conclude sadly that they are. It’s pitiful… ..!!!!
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Posted by Bob in Dallas on 02/15/12 02:34 PM
It is rather ironic that Obama and Romney accused China of being money manipulators. If that’s not the pot calling the kettle black…
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Posted by Ichabod on 02/15/12 02:00 PM
Time for me to update the Bloomberg watch because it speaks directly to this article which hasn’t caught on to the newest. First, let me say it comes directly from the mouths of some of the major Keynesians.
Larry Summers: “There two kinds of economists in Washington these days; those who don’t know and those who don’t know that they don’t know.” (Laughter)
Robert Schiller (Yale): (Paraphrase) “It’s disconcerting to find everything you’ve study during your life isn’t true.”
Olivier Blanchard (Chf Economist IMF) “It is so beautiful to focus on just one thing (CPI), but it does not work. It is also beautiful to focus on two things (cpi + unemployment), but it also does not work. We must focus on many, many things.”
David (Danny on Bloomberg) Blanchflower (Dartmouth Booth School) “We are now teaching Behavioural Finance at Dartmouth.” Note: He was recently announced as an adviser to the a major bank in England. (BOE I think)
So here we have it. Keynesianism is dead. Long Live Keynes taught as Behavioural Finance. That means we’re the best and the brightest. We don’t know yet how to do it but we’re the only ones who can figure it out and make it work. So here we have it: Perception Management will be used to create optimism in the minds of the public because the citizens’ spending accounts for about 70% of GDP and without confidence it will come crashing down.
Fools! It will come crashing down anyway when the truth comes out about the serious manipulation of the currency coming out of the Fed, the Central Banks of the World and the primary dealers who get preferred treatment.
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Reply from The Daily Bell
Your point about behavioral finance is well taken. Something definitely going on there ….
Posted by Abe Froman on 02/15/12 01:10 PM
ok… on The New Republic. Please take note… this is the same publication that published Trilateral Commission member Peter Orzag’s essay titled “We Need Less Democracy” shortly before his fellow Trilat members Monti and Papademos conducted their trilateral coups in Italy and Greece respectively. So a little background on The “New” Republic. The Chairman/Founder is Laurence Grafstein. Who is he? Oh… he is just Co-head of M&A at ROTHSCHILD NORTH AMERICA INC.
IT ALL FITS… IN BROAD DAYLIGHT.
Alan Watt & Brian Gerrish on Sovereign Independent Radio – Part 1 of 2
KARL MARX EU- UN- ETC ALSO A FAR EAST BLOC..AFRICAN BLOC…EUMED..WW1…WW2
IMF-BANKS …COMPANIES FOREIGN OWNED- SELECTED BUYERS. YUGOSLAVIANIAN WAR 1990s
IRELAND- WILL BE TAKEN DOWN…
MASS IMMIGRATION TO DESTROY BRITISH CULTURE FOREVER…..BLAIRS MOB
HannibaltheHerbivore on 19 Jul 2011
This interview is from July 18, 2011. Watt explains the severity of what we are facing. Brian Gerrish makes a few contributions but Watt does most of the talking, having understood the agenda for far longer.