How the IMF Got Its Keynesian Groove Back … Two events in recent years put the IMF back on the Keynesian track: The 2008 financial meltdown, and the arrival of a new fund director, Dominique Strauss-Kahn. Under Strauss-Kahn's leadership, the IMF grew into a bulwark against German caution and orthodoxy. "DSK really did change things," Boorman tells me. "He is a brilliantly gifted politician and a very good economist. That allowed him to insert himself into the G20 process in November 2008. He seized the moment in a brilliant fashion. Any decisions that were going to be taken, the IMF was moved right into the center of them." Some of Europe's orthodox leaders argued for austerity. But, according to Kirkegaard, "the IMF got countries to put their feet on the Keynesian pedal." – The New Republic
Dominant Social Theme: Keynes lives, and a good thing, too. Let statists celebrate everywhere.
Free-Market Analysis: The socialist John Maynard Keynes is once again having an impact on world finance, according to The New Republic, a leftist "thought" magazine. The New Republic is yet another mouthpiece for the Anglosphere power elite, like the Economist, New Yorkerand Weekly Standard (to name a few).
Actually, Keynes, a favorite state economist of statists everywhere, never left. He is the patron saint of the modern, ruinous, central banking economy that has collapsed economies around the world. He was a covert and sometimes overt member of the socialist/fascist Bloomsbury Group and, even worse, the Fabian Society.
Keynes was an elitist, an economic trigger man for the small group of powerful families (and their enablers and associates) that runs the world's central banks and are attempting to create global governance.
This tiny, inordinately powerful group is increasingly blatant and ruthless in its attempts at installing their New World Order. But throughout the past century or so, they've been inordinately careful to present the world with so-called intellectual justifications for their globalist plans.
Within this context, John Maynard Keynes, a man with obvious contempt for the world-at -large, was a valuable individual indeed. A math-o-phile, he had an uncanny knack for marrying absolutely turgid and incomprehensible prose to econometrics in order to come up with justifications for the most logically bankrupt economic conclusions.
He once met with Franklin Delano Roosevelt to go over his General Theory and so befuddled FDR with equations that the president later confessed he'd hardly understood a word that Keynes had said. And yet without further thought, FDR and his administration put Keynes's theories into play. They basically became the economic law of the land, even though FDR may not have understood them.
FDR and his socialist minions used Keynes's meretricious and complex theorems because they justified massive government and central banking interference in the marketplace. Keynes never explained how recessions and depressions came into being, so far as we can tell, but he knew the solution: Print lots of money is how his prescriptions have been applied in the modern era.
This was the "genius" of Keynes. When an economy's "animal spirits" slowed, the government had the right – nay, the duty – to step in and manufacture employment. In Keynes's view, the government could pay people to dig holes and fill them back up, anything that put people to work.
What Keynes was after was getting money to circulate again. He wanted the government to pay people so that they would be able to avoid poverty and to buy goods and services that would reignite the economy.
Keynes believed that the state should save for a "rainy day." But in practice, what this has meant is that the state's central banks have printed the money that the state has then used to "stimulate" the economy by paying people for make-work jobs.
In the case of the Obama administration – a regime with an institutionalized Keynesian bias – tens of TRILLIONS have been disbursed to prop up the central banking economy and its commercial and merchant banks and also to favored "green" industries, infrastructure boondoggles and other inefficient or useless enterprises.
It's been estimated in some cases that a single job may cost hundreds of thousands of dollars of government money. Under Obama, the national debt has expanded dramatically and the amount of inflationary dollars that the Fed has printed is literally incomprehensible.
But all of this is "good" and "groovy" according to The New Republic. This is a magazine that promotes government activism on numerous levels. The staff of such thought magazines invariably argue for SOME sort of state involvement in the economy or in people's lives generally.
This is because these publications have been set up to promote power elite points of view. They are part of a larger dialectic that must always advocate state power within some ambit. Without state power, the power elite has no mercantilist levers to pull and cannot hide behind the democratic process.
The power elite absolutely needs state activism and needs to create vehicles that advocate for state power. The International Monetary Fund is one such example of a facility that forcefully promotes interference in the marketplace as a way of ameliorating economic difficulties.
Ironically, as we pointed out yesterday, the more "right wing" publications like the Weekly Standard often argue for expanded military and civil policing authority while not paying too much attention to economic issues or the welfarist state.
But The New Republic is bad enough. And its defense of Keynesianism is intellectually bankrupt. There is no way round the larger issue of price-fixing when it comes to government interference in the marketplace.
The only entity that can determine how much money an economy needs is the market itself. Money must be privately circulated and subject to the laws of supply and demand. But Keynes's anodynes have been utilized by government econo-crats as a justification for central bank management of the money supply.
These days, around the world, central banks determine the amount of money that an economy needs. The results have been an absolute disaster. As free-market Austrian economists have long pointed out, the overprinting of money leads to booms and disastrous busts.
Keynes's prescription, reigniting the economy by injecting yet MORE money into the economy, merely prolongs the problems. But it suits the power elite just fine.
That's because it gives the power elite the justification to print trillions of new dollars to prop up its failing and bankrupt financial entities. These entities NEED to fail so that people can differentiate between bankrupt facilities and healthy firms. But that's not how it works anymore.
Thanks to Keynes – or the way that Keynes has been interpreted – the elites have used his General Theory as a justification for printing money, ruining economies, bankrupting honest businesses and propping up hundreds of failed and failing banking entities.
Keynes's theories have been an unparalleled disaster. They have allowed the power elite to print money with impunity and to justify propping up its corrupt financial system. Today, the world reels from depression and economic inefficiency. This is a direct result of the justifications that Keynes provided the power elite via his crackpot econometrics.
The article in The New Republic lauding the IMF's use of Keynesianism discusses none of the above of course. It doesn't grapple with Keynes's Fabianism, his contempt for ordinary people or the obvious failures of his general theory.
The IMF itself is a bankrupt institution with a deserved reputation for making bad economies worse and literally starving people to death in the process. The idea that one can marry the illegitimate monetary science of Keynesianism to the thuggery of the IMF and come up with something better than either of the two parts is in our view nothing but wishful thinking.
These articles are empyrean intellectual creations. They have little or nothing to do with real life. They pile on one fantasy after another of the way the world is supposed to work. But it doesn't work that way.
Keynes was wrong in almost every aspect of his "General Theory." The IMF has been a plague among impoverished nations for most of its existence. The best thing that could happen would be that both Keynes and the IMF would be erased from the annals of history.
Either one is horrible. Together, they are a terrible poison, responsible for misery and economic mayhem worldwide.