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The Corner

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Who Are You Calling a Keynesian?



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Dan Mitchell thinks that Michael Strain is a big-government Rockefeller Republican. (I consider both men friends; Strain is also a colleague at AEI.) Mitchell writes:

It’s hard to give Strain the benefit of the doubt when you look at other statements. He claims, for instance, that “government spending can support economic growth during a recession” That Keynesian statement sounds more like Brookings than AEI.

Here’s the full paragraph of the article from which Mitchell is quoting.

However much the left may desire it, another massive short-term fiscal stimulus is politically impossible now, and conservatives are rightly pleased about that. In theory, government spending can support economic growth during a recession, but the practical implementation of short-term fiscal stimulus poses some high hurdles to overcome. It is very difficult to get the timing and composition of such stimulus right, as liberals have frequently found.

So all Strain is saying here is that while there are theoretical reasons to think fiscal stimulus could work during a recession, there are some practical reasons to doubt it. I think Mitchell has just read him a little too fast, which happens to the best of us.

(As for whether I’m a Keynesian: I’d say, definitely no more than Milton Friedman was.) 



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