Rethinking Keynesian Theory: Debunking Interest Rates and Inflation Myths
2024-01-23
In the realm of macroeconomics, a legion of PhD economists in central banks passionately contends that interest rates are a pivotal policy tool for managing the economy. Simultaneously, these economists firmly uphold that the Consumer Price Index (CPI) is an accurate gauge for measuring inflation—a widespread acceptance of this CPI as a valuable metric.
The current theoretical state of macroeconomics should be classified as negative knowledge, akin to asserting that the earth is flat. One should have a better understanding of macroeconomics before delving into the topic.
John Maynard Keynes is to blame for this massive loss of knowledge in macroeconomics. He singlehandedly set macroeconomic theory back to the Stone Age. According to Keynes, interest rates are determined by the supply and
Jacobin Capitalism?
2024-01-19
In his important book The Failure of American Conservatism (2023), the political theorist and philosopher Claes G. Ryn offers some criticisms of libertarianism and free-market capitalism, and in this week’s column, I’d like to examine these.
Ryn is not an opponent of all forms of the free market, but he fears an extreme version of it can be dangerous. He defends what he calls “value-centered historicism,” according to which people’s values stem not from abstract reason but from the concrete particularities of their lives and traditions. From this perspective, he opposes ideologies that propose setting aside existing customs and social practices to remodel all social institutions according to a plan. He argues that the Jacobins of the French Revolution acted in this way; convinced of their