Fraudulent Keynesian economic measures.
How about some actual economic liberty and unleashing the economy, and getting rid of dead weight in the bureaucracy?
Also, the continued funding of students in universities obtaining multiple degrees for fields such as history and philosophy, are areas where money could be saved, but even that proved too difficult for the current political elite to tackle, they folded like cheap suit.
The outgoing cabinet has agreed on a preliminary framework for next year’s state budget. The blueprint approved by the four government parties on Tuesday includes an estimated deficit of six billion euros. Unless the framework is significantly changed by the next government, the state debt will rise to some 124 billion euros during the next legislative term.
The four-year term is likely to begin with the appointment of a new cabinet in late spring. The opposition Centre Party is now poised to win the general election by a wide margin – bringing it back into government after a four-year hiatus. The Centre was the main governing party between 2003 and 2011.
Hayek and colleagues debunk Keynes economic theories.
Hayek, et al. (Hayek for short), identified three areas of contention. First, they correctly identified Keynes’s argument about the futility of savings as actually being an argument about what has classically been known as the dangers of hoarding, i.e., the potentially pernicious consequences of an economy-wide increase in the demand for money that is not met by a corresponding increase in the supply of money. “It is agreed that hoarding money, whether in cash or in idle balances, is deflationary in its effects. No one thinks that deflation is in itself desirable.”
Second, the London professors disputed that it mattered not the form spending took, whether on consumption or investment. They saw a “revival of investment as peculiarly desirable,” as do today’s proponents of supply-side economics. They distinguish between hoarding of money and savings that flows into securities, and reaffirm the importance of the securities markets in transforming savings into investment.
Their third and greatest disagreement with Keynes was over the benefits of government spending financed by deficits. They demurred. “The existence of public debt on a large scale imposes frictions and obstacles to readjustment very much greater than the frictions and obstacles imposed by the existence of private debt.” This was not the time for “new municipal swimming baths, &c” (Keynes’s example). In our contemporary context, no stimulus.
Finally, and importantly, they offered a way forward. Governments world-wide, led by the U.S. with the destructive Smoot-Hawley Tariff of 1930, had turned to protectionism and restrictions on capital flows. Hayek argued it was time “to abolish those restrictions on trade and the free movement of capital.”
Was Keynes correct that savings become idle money and depress economic activity? Or was the Hayek view, first articulated by Adam Smith in the “Wealth of Nations” in 1776, correct? (Smith: “What is annually saved is as regularly consumed as what is annually spent, and nearly in the same time too.”)
NOTE: Money saved in banks continues to work regardless. The wealth of knowledge within the private sector will always trump that of the cabal of geniuses that crowd the hallowed halls of academia and the White House.