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Daniel, I want to respond to your post on your blog about this subject so that the professors here can add it to the discussion if they wish. You state that if we apply the same argument that Zingales, Boettke, and Buchanan use against Keynes, then we should lay at Hayek's feet "Massive military buildups...Large and growing deficits during recessions as well as boom years...A complete lack of will to deal with entitlements or propose a long-term budget solution." So, if I may oversimplify the issue, the argument here is that it is illegitimate to attribute to Keynes the folly of politicians because he did not support to this level the fiscal policies being abused. However, if we are to levy this criticism, then we must also apply it to Hayek and attribute to him the Republican's massive military budget, the resulting deficits, and lack of budget I'm not sure about this. Buchanan is starting his argument with the premise that the ideas espoused by Keynes existed prior to his publication of them. He provided academic and intellectual legitimacy to these ideas. Formally, you can call this theory whatever you may want to call the economics of Keynes. Now, if you want to argue about to what extent we may attribute to Keynes himself the policy prescriptions of those that came after him, I think that is an interesting question. The issue that I see is in the fact that the policy prescriptions that you believe that we cannot attribute to Keynes are considered within the vector that we call Keynesian economics due to the academic and intellectual contributions of economists that consider themselves in the same tradition. I think it is hard to argue that the advances of Keyenes and the Keynesians after him did not provide politicians with modern tools to abuse the strategies espoused by both the man and those considered in his tradition. (Yes, I did use the Leijonhufvud distinction.) What about the other side of the coin? Your argument is that the policy prescriptions stated above can be attributed to Hayek because Thatcher, Reagan, Paul Ryan, Rand Paul, and Glenn Beck said that they were inspired by him. I may be incorrect, but I am not familiar with any of the professional or academic economists which consider themselves within the same tradition as Hayek to have espoused the policies that would have granted politicians the political license for the results you stated.(For example, Hayek criticized Reagan for cutting taxes without cutting spending. Also, I am aware that many of Reagan's advisors were members of the Mont Pelerin Society. However, I don't think that qualifies them as being Hayekians. Reagan's attorney general Edwin Meese stated that Friedman was the more important influence on the administration. If you want to claim that Friedman was pro military buildup, then welp.) In other words, the vector of Hayekian economists relative to Keynesian economists is less dense and contains significantly less cache in the realm of public policy and high institutional academia (I'm ignoring the influences of Hayek on Ostrom, V. Smith, etc. because of the non relevance to the points that you made.) What tools did Hayek provide for what these politicians decided to do? That was a lot so I will summarize if you do not wish to read all of it. I think it is hard to (and after reading your contributions here and on Cafe Hayek, I do not think you will) disagree that Keynes and whatever we may want to define has Keynesian economists, intenionally or not intentionally, provided the modern tools necessary to accomplish and rationalize the abuse of ideas espoused by Keynes and the Keynesians. Therefore, there has been a significantly deeper and stronger influence by the Keynes and the Keynesians on public policy and academia than Hayek and the Hayekians. I am unconvinced of the necessity to make the same argument against Hayek because the evidence is unclear (or non existant) that the man or his followers provided the tools that produced the folly of the Republican party. I mean, I'd like to believe that The Road to Serfdom and The Constitution of Liberty were as influential in economics as The General Theory, but I'm not sure that the RTS should be influential in academic economics, and I'm sure that neither are as influential. I have not really addressed the issue of whether or not we can attribute the work of the Keynesians to Keynes. I will in a later post if needed. Just as a side note, I mean this post in the most cordial manner. I hope you will take it that way.
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Nov 1, 2011