Ernest Hancock
Letters to the Editor • Philosophy: Socialism
Free Market Needs Keynes Law Just As Civilized Society Need The Government And World Order
Free Market contortionists comprising of the militant anti-government right, anti-globalists and Christian fundamentalists attack Keynes’ economic principles, the Government and World Order relentlessly as if there is no tomorrow when they mouth their passion on fire. It would not have been disquieting for me or to anybody as tolerant as I am if the basis for this mounting hostility is not false or maliciously distorted to ventilate the rising anger of the frustrated public against Obama’s socialist dictatorship.
My point of concerns is simply this: We fry on our lard without any regulatory intrusion into our free market system. Greed is in the System that heats up competition. Something has to cool it off or we get burned. We badly need market intervention just as how bad we need rain in summer.
I have many times written this before -- in the academe, in my newspaper columns and in several online publications -- and I must write it down again to meet the demand of the present disturbing situation: The hallmark of our free enterprise society is the freedom to freely compete. If propelled by greed the strong insists on bullying the weak out of existence, the strong must face the consequences of not abiding by the rule. That’s when the Government becomes a force or authority that intervenes. So the required advice of the day is Don’t call the Government your enemy when you are forced to face the consequences of your meanness or bigotry. Only nincompoops think that way.
Adam Smith, the father of our free enterprise system, recommends “government regulatory intervention” when monopolists or market bullies driven by greed are controlling our free enterprise economy or society. Without the participation of Government, our free market system cannot survive. This is part of the two different economic systems in the world – the Centralized Economy versus the Free Market Economy -- where Karl Marx in his Das Kapital and Adam Smith in his Wealth of Nations are at convergent point. The agreeable meeting point at that crossroads is Government.
I noticed that hardly participants in this discussion – especially the anti-Government panel – understand the role of Government in our free enterprise society. That the market should be left alone to rule or govern on its own without a regulatory stick to protect the right of everyone to compete against the greed of powerful bullies shows total ignorance of how our market system works. “No government intervention” should have been the ideal rule, if we have a “perfect market” system. Unfortunately, there is no such thing as “perfect market” or “perfect pricing” of commodities in the free market system. You have to sweat it out in graduate school to get your doctorate to be able to really dissect and understand this mysterious and at times cryptic puzzle.
Keynes like Smith is an interventionist in our free market system. Attacks on Keynes, question, among others, his economic principles, as false or misleading, frequently calling them the work of a capitalist conspirator.
There is nothing wrong about “Keynes law” in economics. Public spending will stop recession. This Keynesian “law” is as un-modifiable as the law of supply and demand. It is just wrongly applied and the bad result blamed on Keynes by politicians whose abrasive or destructive political agenda must have a scapegoat to survive.
For example, take Obama’s massive financial bailouts. This is not Keynes’ economic concept of public spending to pump-prime a declining economy – it is a corporate rescue of massive debts gone bad [mad]. Paying up huge foreign debts with national savings [known to the laypeople as their tax money] is not the same as massive spending for public works, a good example of pump-prime spending for a depressed economy. Government borrowing for this purpose is totally different from sub-prime loans or borrowing that leads to nowhere but financial disaster or economic debacle. This distortion is blamed on “Keynes’ law” on how the receding economy can be pulled out of depression.
Another example of the “Keynes law” that vultures take advantage of is with regards to galloping inflation. Government spending can only intentionally create so much rate of inflation in order to respond to a certain level of unemployment when the depressed economy is rapidly losing so much jobs. Thus the “Keynes law” has a corresponding precise curve in the graph – the ascending rate of inflationary spending reflects the equivalent of the declining rate of unemployment. When the arrow is going up for inflation, the arrow is going down for unemployment.
But this did not happen in the 1970s. Inflation was up and unemployment did not go down but up. To us economists, this is better known as “stagflation”. A pumped-prime economy is not supposed to be stagnant, and employment should have increased when consumer spending is up [the Philips’ Curve Paradox]. The distortion of rising prices was oil-based created by OPEC. It was not generated by the “Keynes law” on inflation that spurs employment.
Thus faulting the Keynesian economic principles in this manner makes me yawn with such a revolting indifference that I cannot help but expose the ignorance of those who pretend to know everything but knew nothing.
Again, I have also to write this down for the benefit of our reading public being misled by the passionate criticisms of anti-globalists or by the published critiques of those who fear that World Order will make their world more horrifying than Hitler’s Holocaust. Truth of the matter is, there has to be a World Order for the survival of mankind. Find it here:
http://www.globalresearch.ca/index.php?context=viewArticle&code=20100613&articleId=19706
Indeed, World Order is one of those conspiracy theories. But Order is what civilized societies need. My all time advice: Don’t be disorderly. You don’t look great without Order. There has to be a World Order, new or old. Think of a world without order. Only a rebel without a cause or whose thinking lacks commonsense or whose thought process is disorderly, is against it. Order is a way of life… the way things have to be outside of the cave we used to live in.
Order could be in any world. Don’t laugh, but even in smorgasbord restaurants, you cannot eat unless you pay for your own “self-ordered” food. Force your own way into it without observing this procedure or order, and see what happens and know for yourself what I mean. To eat at home, you can’t cook in your kitchen either unless there is a way of doing it. You can’t eat anything in anyway you want unless you are from another planet or not human living on President Obama’s handouts or a bed-ridden creature with medical condition forced into his healthcare plan.
The problem of sociopaths banging their head against World Order is that they think the post-war New World Order is a frightening Monster under their bed ready to jump on them and gobble them alive. They would rather prefer to live in a world of chaos and anarchy without order where they can monster everyone anytime they want. To them Government is a World Order that makes their life miserable, rather than makes life livable in an orderly fashion.
To make life miserable is not what we create Government for, or what World Order is for. Try to study a little bit more what the United Nations is all about, and understand what it is for. Don’t even try to pretend that the World doesn’t exist or should not exist in your life – it is always on top of your shoulders, if you know my meaning, or in free expression, understands euphemism that deflects a direct statement of my outrage over such insulting ignorance.
Nations that survived WWI and WWII understand what the New World Order is all about. We knew and supposed to understand it better than the rest of the world because we were not only involved in global conflicts but also one of the most active participants in many wars of attrition. Only a hillbilly who has not gone out of the woods all his life or a retarded [brain-damaged] revolutionary in rage or a bunch of spoiled brats who need a government spanking would kick in tantrum because they think Government is Hell which to them our “stupid” forebears had created for America’s future generations. That’s why in a civilized society, these bucket-kickers prefer to live life that their individual self wants, not what everybody wants under the rule of the majority.
Now, are there people who run the Government or the UN-created World Order taking advantage of the “power” that makes life miserable? Like those “celebrated” [in one hand] and “condemned” [in another] LPD officers that love to bash Rodney King’s skull because those rogue authorities think they are the Government addicted to kicking blacks’ ass? Of course there are. Let’s not argue that there are no criminals in uniform mixing with LPD’s finest. If we argue that there are none, this stupidity becomes a blinder that would lead us to misunderstand what the Government or the World Order is for. I am four-square against bigots that think they are the Government, and out of pure joy would love to be one of the pallbearers for their demise or exit out of this world. But they are not “the” Government itself, nor are they “the” World Order itself. Only a cross-eyed mentality that could hardly see an arm’s length away would mistake one for the other.
Let’s not forget that it is “we, the people” who put those scoundrels in the Government and only “we, the people” can take those rascals out. Only the retarded or with poor if not impaired judgment would rise in arms and incite others to fight and destroy as the only way out they know. We read a lot of those nuisance paper revolts or anti-government dagger-throwing everyday; it is like an on-going conspiracy to foment hatred against the Government because they erroneously think the Government is Obama. The Government is the song Obama loves to sing about which we hate to hear. The song is the Government, and Obama is the singer. You may hate the singer, but not the song. That’s because the song can be sung by a singer much better than Obama who is so far the worst politically correct singing canary that ever graced the stage.
I am tired of hearing discordant singers sing cacophonous diatribes against the Government or World Order as a “Conspiracy” with capital letter “C”. They have no clear idea at all what they mean when they talk about “Conspiracy”. They think that it only meant a sinister “plot” to annihilate them or destroy someone or something. In Literature, Shakespeare used the meaning of “Conspiracy” with eloquence in his masterpieces Macbeth and Othello – immortal stories of betrayal and treachery that red-flagged mankind of human compassion which the mean-spirited consider a weakness or the negative virtue of the weak. What they are hardly aware of is that the term also meant a strategic “plan” of a body of conspirators that address a problem, or a “strategy” to overcome a sinister plot directed against them. In the 1970s for example, the world economy was threatened by the sinister plot of the greedy Oil Cartel, and a “plan” for the New International Order” was hatched up by the global community against the baleful design of OPEC better described as an international organization of conscienceless opportunist oil profiteers.
Let’s talk some sense into the minds of those hateful anti-order spoilers. Those of us who argue for the abolition of the Government or World Order like spoiled brats have to grow up. This debate is important. But let’s not try to be silly.
It is not the least funny to me when the intelligence of the American public is insulted by this kind of kindergarten posturing against the Government or World Order or by the presentation of those poorly argued Austrian School of economics. Those faulting and faltering hate-based arguments do not do justice to the great exponents of “marginalist revolution in economic analysis” like Carl Menger and his associates William Stanley Jevons and Leon Walras. When extolled by emotionally deranged street economists in their anger against free market intervention they hardly understand, the reputation of those great Austrian philosophers are damaged beyond repair.
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4 Comments in Response to Free Market Needs Keynes Law Just As Civilized Society Need The Government And World Order
Tocomment #24677: You said “Your premises are often incorrect.” You didn’t say why it is incorrect. There are more conclusions like this coming from you that have no legs to stand on. It means your comments are shots from the dark that hit nothing.
I am interested of what you know about Keynes that I don’t. I am about to believe that you are even better than Keynes, which the tone of your intervention purports to be.
In my “lawyering” days, I once handled a case of defamation where my client, a reputable businessman, was publicly slandered that among others that had been said about him, he was a “bastard”. When I cross-examined this slanderer in court, he couldn’t support his sworn statement that my client was a “bastard”. It was just his conclusion.
By the way, on the subject of “Order” that I wrote about, what “redistribution of wealth is failing” … are you talking about? I was talking about putting “regulatory intervention of the Government” or “order” into our free market system when it is controlled by powerful corporations and free competition is going kaput. You seemed to be talking about something else you did not explain and therefore you alone understand.
But I think comment #05338 below beats your legless comments, because the latter seems more pretentious of knowledge where there was none, when it says “Unemployment and inflation are different issues caused by different things.” He doesn’t get it or cannot understand what I wrote about “stagflation” which simply means that the rate of Unemployment rises correspondingly with the rate of rising Inflation, a violation of the Keynesian economic law where when the Government increases the rate of inflation by pump-priming the economy to create more jobs, the rate of Unemployment decreases.
Keynes Law has help to put the U.S., from a socio-economic standpoint, back to where it was prior to the American Revolution. Some of your assumptions and therefore your conclusions are wrong. We are not a free market society nor have been for many years. Unemployment and inflation are different issues caused by different things. Like Keynes your a good author but your understanding of how the world really works is sadly also wrong.
Where do I start. Your premises are often incorrect, thereby leading you to the wrong conclusions. You have a very tough time staying on subject matter and often times use a premise from one issue to draw a conclusion for another. I hope your readership is limited as many, like Keynes readers, where not able to cut through all the malarky. Your arguments on "order" do not even go into the specifics of the level of order, therefore are vague and meaningless. The redistribution of wealth is failing us miserably and you write of "order" as if it has some relevence in the context of your position. Like Keynes you write well, but say little of anything truely meaningful whiles drivng home your positions without true support.
Most people prefer to believe that their social leaders are just and fair, even in the face of evidence to the contrary, because once a Citizen acknowledges that the government under which he lives is fraught with corruption, the Citizen has to choose how he or she will live. To take action in the face of corrupt government entails risks to life, liberty and the pursuit of happiness. To choice to do nothing is to acquiesce to apathy, thus destroying one’s self-image as a supporter of basic humane principles by allowing iniquitous results to continue. Most people do not have the courage to make that choice. Hence, most propaganda is not designed to fool the critical thinker and dissenter, but to give moral cowards an excuse not to think or take appropriate actions to improve the human experience.
Such a good letter. It nails that fundamental, crucial Achilles heal of radical libertarianism. If you remove all cops and government, within weeks you are ruled by biker gangs under a regime that is ten times worse. If not, why not? In market terms, if you remove regulators, the larger corporations own the whole market within years. Don't think so? Tell me why not.
Seems to me, we have to sneak up on the problem from a side-long flanking position. Does it matter whether corporatist overlords manipulate the market via an absence of regulation vs. an overabundance of regulation? If it does, then why? I don't think it does. Now, abolish corporate personhood and the problem is solved. Solved under Keynes, solved under Hayek! It virtually doesn't matter.
When the day comes in which every employee (private or government) is fully, personally accountable for their every personal action, it's game over for the bad guys. If, as an employee, you have that signed memo from above, then the litigation goes straight past you and upstream to the exec who wrote the memo. If you are not covered by such a memo, then you acted alone and YOU go to court with YOUR personal treasure on the line. This will mean no exec will write an evil memo that launches anything that could be litigated against in the future, and no employee will do jack-squat without first having such a memo in their hands. Problem solved at the root. The economic schools, to me, leave little to choose between unless and until this fundamental problem is resolved.