Tamny is a fierce, well-informed critic of the whole notion of Keynesian economics. He writes, in exposing the illogic of the demand side focus of Keynes, “[O]ur wants are unlimited. We always desire something more, and the exchange of our labor for the food, clothing, and shelter that we do not possess makes economic growth a simple matter of reducing the barriers to production.”
In other words, human wants are insatiable. Therefore, insufficient aggregate demand can never be a problem for economic growth, as Keynesian economics fundamentally claims. Tamny explains further, “At the most basic level, a person must first supply something before he can purchase something else. The path to economic growth, then, is stimulating the supply side of the economy. Government can stimulate the supply side by reducing tax, regulatory, trade, and monetary barriers to production."
Sunday, July 26, 2015
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