Where do they get their ideas from?

Nikos Konstandaras writes “Supply, demand and protection’ in Kathimerini, Greece’s international English language paper on 20 March:

“Lately, no economic theory has established itself as the successor to the those of Adam Smith, Marx and Keynes, who taught us that governments must spend (creating deficits) in order to fight unemployment and keep as many people as possible inside the cycle of work and consumption. Today, most governments have already run up huge deficits while unemployment remains at dangerous levels; in other words, they don’t have much room to manoeuvre’.

Comment
Smith didn’t leave a ‘theory’ in the 18th century to be applied in the 21st century. He left a report on the millennia following the Fall of Rome. In it were several ideas and a methodology for analysing socio-economic change; not a prescription for policies in today’s vastly different economies and the two hundred years of history that separated his world from ours.

As for Karl Marx, he is no model for the 21st century – he caused enough problems in the 20th century through his successors efforts to replace markets with central direction. And Keynes has politely withdrawn from the scene following the high-tide failures of his policies.

I would have thought that Nikos Konstandaras would have drawn the connection between his assertion that ‘most governments have already run up huge deficits while unemployment remains at dangerous levels’ and his assessment of the consequence that ‘they don’t have much room to manoeuvre’. Unfortunately that is not the case.

Among his suggests he recommends that ‘unemployed graduates’ go from Europe to Third World to help them grow; that a new ‘Global Bureau’ be set up at the UN (obviously he is oblivious to the bureaucratic monstrosity that would create, plus the sheer expense) to supervise what he calls the ‘benevolent cycle’ from the presence of these unemployed graduates in Third World countries (doing what?); worse he slips in a proposal for official ‘islands of protection’ in Europe for ‘certain industries and farming’, ‘monitored and taxed’ to prevent countries ‘abusing’ the system, with the money collected going to a ‘fund’ ‘European professionals’ going to Third World countries that invite them in!

As Mr McEnroe used to say: ‘you can’t be serious!’ Unfortunately I fear he is.

In a separate page of Kathimerini, there is an editorial quoting: ‘Meanwhile, former PASOK public works minister Vasso Papandreou — evidently counting upon those with short memories who have forgotten the performance of the previous government during its eight-years in office — maintains that PASOK would have given workers’ double the wage hikes the current government has approved, that is increases of around 7 percent.’

It beggars belief.

As I have often asked my relatives in Greece: How did Greece get into the European Union?’ Partly, recent events have answered me: ‘Because at heart they are totally in tune with France, German, Italian and Dutch interventionist states, i.e., if there is any problem anywhere they believe the best answer is to get the State to tax and spend money on it.

You don’t need a new theory to deal with these problems. Just rely in examining their history and don’t repeat it.

Read the article at: http://www.ekathimerini.com/4dcgi/_w_articles_columns_100028_20/03/2006_67661