[발췌: some dialogue on] Financial crisis of 2007, stimulus measures, Keynesians

자료 1: This American Life, Chicago Public Media & Ira Grass (Originally Aired January 30, 2009): The New Boss, Transcript.

※ 발췌(excerpts): [Act Four] Fifteen Trillion Dollar Dismal Science Experiment.

Ira Glass: And this brings us to Act Four of our program. Act Four, The $15 trillion Dismal Science Project. Of course, a new boss comes in with a new plan for how things should be run and one of the big parts of Barack Obama's new plan is the economic stimulus package that was passed in the House this week. It's going to be debated next week in the Senate. He's been talking about this stimulus a lot.

Barack Obama: Thank you. Thank you.

Ira Glass: This is from the big speech he gave a couple weeks ago where he explained the economic package. The House's version will cost the government over $800 billion, $800 billion of spending and tax cuts that Barack Obama says is the only thing that can help our economy right now.

Barack Obama: It is true that we cannot depend on government alone to create jobs or long-term growth, but at this particular moment only government can provide the short-term boost necessary to lift us from a recession this deep and severe. Only government can break the cycle that are crippling our economy, where a lack of spending leads to lost jobs which leads to even less spending, where an inability to lend and borrow stops growth and leads to even less credit.

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Ira Glass: In fact, much of the President's plan comes straight out of a very old playbook, a playbook developed before World War II, in fact, in the depths of the Great Depression by a foul-mouthed, slutty British elitist, who was called arrogant, supercilious, unbearably boorish. And that's by his friends. His enemies, man, they really hated him.

He's one of the great economists of the 20th century and you've probably heard his name, John Maynard Keynes. The team that brings us our economic stories here on This American Life-- that's our producer, Alex Blumberg, and NPR economics correspondent, Adam Davidson-- have this story about him and his playbook.

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Alex Blumberg: This is another economist, Alan Blinder at Princeton, who was an economic adviser to President Clinton. A failure of effective demand, he says, is basically that people aren't spending enough money. Maybe they don't have any or they got laid off or they're afraid they're going to get laid off.

Adam Davidson: And if people aren't spending enough money, there's no way for the economy to automatically adjust. And in the 1930s, nobody else had figured out how to get people spending again.

Alan Blinder: The Keynesian prescription is if all else fails, the government can spend the money. So normally we don't say in a free market economy, well, the government. We say, well, people and businesses should do it, but Keynes's idea, which was revolutionary at the time, is if the private sector won't do it, then the public sector can do it as a fill-in, a stop gap.

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Alex Blumberg: FDR did expand the government spending. He started the WPA and the Tennessee Valley Authority and a whole alphabet soup of other programs, but he never spent as much money as Keynes said he should have. And he did all sorts of things that Keynes opposed, like raising taxes and trying to balance the budget, which Keynes said would just cancel out any positive effect from the spending.

FDR sort of drove Keynes crazy, actually, and prompted at least one scolding letter. But then geopolitical events took over and forced FDR to spend as much money as Keynes wanted.

Alan Blinder: The huge dose of massive Keynesian stimulus came in the buildup to World War II. We started spending titanic amounts of money.

Adam Davidson: And was the way we ended the depression Keynesian? Was it--

Alan Blinder: Yeah, it was Keynesian, but it was not for that reason. I mean, it was to fight Hitler and to fight Tojo, but it was Keynesian.

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Alex Blumberg: Back in the 1940s, nobody was listening to that argument. For about 30 years after World War II, Keynesianism was mainstream economic theory, but during that time Keynes's theory morphed into something that Keynes himself wouldn't have recognized.

Keynes's mantra was always uncertainty, what he once called the dark forces of time and ignorance which envelop our future. But his disciples came to believe that his theories could be used in a much more precise way to control the economy than Keynes ever believed.

So Keynes's disciples thought if the economy needs a little boost, you cut just enough taxes and increase just enough spending. If the economy is heating up, you do the opposite. You raise taxes by a couple of percentage points and cut government spending.

Alan Blinder, the Keynesian economist at Princeton, says that there was a triumphant sense among Keynesians, that by carefully tweaking taxes and spending this way, they could overcome booms and busts. They could permanently eliminate recessions.

Alan Blinder: There was a view that developed in the 1960s-- and developed excessively, one must admit in retrospect-- that we could steer the national economy pretty well. Not perfectly, but pretty well. If you pick up Walter Heller's book that was written in the 1960s-- Walter Heller was the head of the Council of Economic Advisers for Kennedy. The amount of optimism exuded there seems almost laughable. This was a watch we were repairing.

Adam Davidson: One way the economy is not like a watch, when you repair a watch, politicians aren't involved. Politicians took the Keynesian message that government spending can be good and they kind of went nuts. They paid for the war on poverty, the Vietnam war, they sent a man to the moon, all the time running up the federal deficit, convinced that Keynes gave them a free pass.

For Keynesians this is always a problem. Prescribing Keynesianism to some politicians is like prescribing crack to a coke addict. They like it a little too much. And in the 1970s, the patient hit rock bottom.

We had high unemployment and the Keynesian solution stopped working. We spent and spent and unemployment got worse and we got inflation, something Keynesians had no answer for. After that, it was the Keynesians' turn to walk in the wilderness.

Chris Edwards: When I took macroeconomics in the 1980s and early 1990s, the textbooks explained the basic Keynesian system but then spent a few chapters showing why the Keynesian system did not work.

Alex Blumberg: This is economist Chris Edwards with the avowedly anti-Keynesian Cato Institute, a think tank founded in 1977 near Keynesianism's lowest point.

Chris Edwards: I thought the debate was settled in the 80s and I thought we all agreed that Keynesianism doesn't work. But now with the new stimulus package before Congress all these Keynesians have come out of the woodwork.

Adam Davidson: Did you know there were Keynesians around?

Chris Edwards: Sure, but I thought the sort of kindergarten Keynesianism, as I call it-- the simple idea that the government could spend more money to grow the economy. I thought that really sort of simple Keynesian idea had died in the 1970s, but I was wrong.

Alex Blumberg: Edwards is part of the school of thought that replaced Keynsianism. There are a bunch different groups in this school, the monitarists, the Chicago school, supply side economics.

Adam Davidson: And they use a different set of tools to steer the economy than the Keynesians. The Keynesians, remember, like to use taxes and government deficits. These anti-Keynesians said, never use those tools. All you have to do is have the central bank, the Fed, carefully control interest rates.

If the economy overheats, raise rates. If it starts to sputter, lower them. This is why you've heard so many newscasts in the last two decades about Alan Greenspan or Ben Bernanke raising or lowering interest rates.

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Alex Blumberg: The Keynesians and anti-Keynesians fought some bitter battles through the 1980s, but by the Clinton administration, most economists agreed on the basics. Some of Keynes's ideas are useful, but we're in a post-Keynesian world. The interest rate is the tool we use. This view held pretty much until exactly one month ago, December 16th, 2008, to be precise.

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Alex Blumberg: That's the day the Fed tried to stabilize the economy by lowering interest rates all the way down to 0%. It can't go lower. But the economy kept getting worse. Their main tool seemed to have stopped working.

So economists and policy makers started looking around for some other way to fix things and they found that there's one guy in particular who'd given a lot of thought about how to get out of a situation like this.

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자료 2: Obama Gives Keynes His First Real-World Test (January 29, 2009)
by Adam Davidson, by Alex Blumberg


DAVIDSON: One way the economy is not like a watch - to repair a watch you don't need politicians. Politicians took the Keynesian message that government spending can be good and they basically went nuts. They paid for the war on poverty and the Vietnam War. They sent a man to the moon, convinced that Keynes gave them a free pass for all this spending. For Keynesians, this is always a problem. Prescribing Keynesianism to some politicians is like prescribing crack to a coke addict. And in the 1970s, the patient hit rock bottom. We had high unemployment, and the Keynesian solution stopped working. We spent and spent, and unemployment only got worse. And we got inflation, something Keynesians had no answer for. After that, it was the Keynesians' turn to walk in the wilderness.

Mr. CHRIS EDWARDS (Economist, Cato Institute): When I took macroeconomics in the 1980s and early 1990s, the textbooks explained the basic Keynesian system, but then spent a few chapters showing why the Keynesian system did not work.

DAVIDSON: This is economist Chris Edwards, with the avowedly anti-Keynesian Cato Institute. The think tank was founded in 1977, near Keynesianism's lowest point.

Mr. EDWARDS: I thought the debate was settled in the '80s and I thought we all agreed that Keynesianism doesn't work. But now with the new stimulus package before Congress, all these Keynesians have come out of the woodwork and I'm wondering where all the theorists are that oppose the Keynesian system.

DAVIDSON: Did you know there were Keynesians around?

(Soundbite of laughter)

Mr. EDWARDS: Sure. But I thought this sort of kindergarten Keynesianism, as I call it, the simple idea that the government could spend more money to grow the economy, I thought that really sort of simple Keynesian idea had died in the 1970s, but I was wrong.

DAVIDSON: Chris is part of a school of thought that replaced Keynesianism. That school says government spending causes more problems than it solves. To control an economy, these people think, the best way is to have the Fed, the Federal Reserve, control interest rates. And this view has held pretty much until exactly one month ago, December 16th, 2008 to be precise. That's the day the Fed tried to stabilized the economy by lowering interest rates all the way down to zero percent. They can't go lower. But the economy kept getting worst. Their main tool seemed to have stopped working. So economists and policy makers started looking around for some other way to fix things. They found that there's this one guy in particular who'd given a lot of thought to get out of a situation like this.

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