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Originally Posted by Brucelee
Given that I teach Economics and Finance, that would be a mistake on my part, no?
Actually, Keynes initial work has some merit as far as it went. Subsequent observations and of course, the misuse of his THEORIES, have called most of his assumptions and conclusions into dispute among reputable economists.
I think the US' recent experience with Stimulus and such will put the final nail in the coffin except for of course, the true believers.
The question isn't really whether the government can contribute to aggregate demand in the short run (it can given the method). Rather, the issue is whether this is the best way (among alternatives) for the government to act.
That I think, is very much in question.
My last comment is to the "economics as a field." In truth, economics is not a science as traditionally defined. It is much more a bunch of theories about aggregate human behavior with money as a signal.
One can prove almost nothing in economics. That is why it is so much fun to teach.
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We're on the same page now. I wholeheartedly agree that the spending over the recession has been wasteful. I suppose what we have to figure out is, which would be the better spend of money: tax cuts or government spending. I think at the moment it would have to be government spending, as tax cuts are not going to directly encourage anyone to spend.
I would like to know where you think Keynes' original theories stop and bad assumptions begin, and perhaps this is more of an opinion than a fact but either way I'm curious.