The thing that has puzzled me throughout the long aftermath of the collapse of Big Shitpile is the willingness to do nothing. The issue isn’t a disagreement over how to reduce unemployment. Instead, there is a general consensus not to try, as Brad DeLong notes:
And we are left with the live macroeconomic theories being those of the 1960s, at the latest. This is embarrassing for those of us who want to belong to a profession that is a progressive science, rather than an analogue of medieval barbering.
So what would the economic theories of the 1960s and before tell us to do?
•Milton Friedman: monetary expansion, and more monetary expansion–quantitative easing as deep and as broad as necessary to get nominal GDP back to its trend.
•John Maynard Keynes (or at least one of the moods of Keynes): have the government borrow and buy stuff, and keep buying stuff until real economic activity is back to some normal trend value.
•Jacob Viner: Why choose? Do both! Print lots of money and have the government use it to buy stuff and hire people.
The odd thing is that none of those three recommended policies–all of which are sponsored by economists with the purest of purebred pedigrees–have been followed….
It is not as though anybody is happy with 9% plus unemployment, is it?
That’s where I think DeLong is wrong: lots of people believe that austerity is the penance for our sins. “We” behaved profligately, and now we must repent through austerity. This is medieval barbering (boldface mine):
People who believe God is very engaged in their everyday life tend to see conservative economic policy as an article of faith, according to a study published Tuesday by Baylor University.
Paul Froese, co-author of the Baylor Religious Survey, says that those who believe in a more hands-off God tend to believe in more than one way to fix America’s economic woes. But those who believe in a more active God tend to believe there is “one truth” when it comes to fixing the economy….
Froese, a sociology professor at Baylor, said conservatives “have so conjoined their religious faith with economic conservatism that economic conservatism has become a matter of faith. It is very hard to sway those people with a counter argument.”
The study also found that 20% of Americans believe God is in control of the economy. According to Froese, those who believe God is in control also tend to believe that a hands-off approach is the economy’s only possible fix.
“Lack of government regulation, low taxation,” he said. ” That kind of conservative economic world view, for people with an engaged God, is almost synonymous.”
This coupling of belief systems began in the 1980’s said Froese, when the Republican Party began to court values voters who selected their candidates based primarily on social issues. Over time, the value voters began to go along with the economic teachings of Republican leaders of the time.
“Those kinds of voters who are driven by their faith tend to think that there are these ultimate truths out there and that everything else is wrong,” said Froese. “If you find a part of a leader you are in agreement with on these faith statements, then their discussion on the economy must also be right.”
…“When Obama is talking, he is always talking about looking at anything that works: ‘I want to make compromise. I want to do things that pragmatically have immediate results,’” he said.
In contrast, Froese said the rhetoric of candidates like Michele Bachmann and Rick Perry is shaped by their belief in an involved higher power.
“’“Have faith in God. Don’t regulate. Lower taxes. There you are seeing a distinction in the almost philosophical outlook and how you understand economic theory,” he said.
The tragedy of this is that ‘we’ haven’t behaved poorly: only some of us have been greedy and avaricious. They, however, are not the ones paying the price for what happened, and, instead, those who can least afford to do so are. Unlike this theopolitical laissez faire-ists, I was taught that justice is something we must actively pursue instead of waiting around for, but then again, I’m a ‘Judeo’, not a ‘Judeo-Christian’, so what do I know?
(God’s will? I think not.)
As always, remember: nothing in movement conservatism makes sense except in the light of creationism.