Thomas Sowell: Janet Yellen and the return of Keynes
Ms. Yellen, a former professor of economics at Berkeley, has openly proclaimed her views on economic policy, and those views deserve very careful scrutiny. She asks: "Will capitalist economies operate at full employment in the absence of routine intervention?" And she answers: "Certainly not."
Ms. Yellen asks: "Do policy-makers have the knowledge and ability to improve macroeconomic outcomes rather than making matters worse?" And she answers: "Yes."
Her first question, whether free market economies can achieve full employment without government intervention, is a purely factual question that can be answered from history. For the first 150 years of the United States, there was no policy of federal intervention when the economy turned down.
Keynesian economists would say that this was exactly the wrong thing to do. History, however, says that unemployment the following year went down to 6.7 percent — and, in the year after that, 2.4 percent.
Thomas Sowell is a senior fellow at the Hoover Institution at Stanford University. His website is www.tsowell.com.
READER COMMENTS: 1
- Reports: Yankees get Red Sox Jacoby Ellsbury - 0
- Vin Sylvia: Making the case for Carpenter - 0
- Vin Sylvia: Newly retired Chris Carpenter planning to move back to NH - 0
- Gomes hopes Red Sox retain all their free agents - 0
- Carpenter lauded as one of Cardinals' all-time greats - 1
- Amherst's Huntington runner-up to Cherington - 0
- Cherington garners Executive of the Year - 0
- Red Sox extend offers to Elsbury, Napoli and Drew - 0
- Dave D'Donofrio's Sox Beat: Redemption Sox - 0
READER COMMENTS: 8
- Police say man kept suspect at gunpoint in Nashua hospital parking lot - 0
- Rollover backs up traffic on Everett Turnpike - 0
- Shaheen, Ayotte on opposite sides of procedural vote on budget compromise - 3
- Snow slows NH rush hour; cancels many evening events - 1
- Loan company and its officials accused of operating illegally in NH - 3
- Two robberies within 45 minutes in Manchester - 2
- NH ranks first in controlling infectious disease, according to report - 1
- Former Berlin man to be sentenced April 1 for credit union robbery - 0
- Knife-wielding robbers target two stores in Manchester - 2
Blue Jays knuckler may be headed to NH
Most NH hospitals average on measurement of knee, hip surgery; Wentworth-Douglas among worst
Shaheen, Ayotte split on House budget plan
State agrees to delete toll booth photos