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Why Keynesian Economics Is A Failure

Written by | October 23rd, 2010

Keynesian Economics, which derives from The British economist John Maynard Keynes’ 1936 book, The General Theory of Employment, has had a recent resurgence in The United States, as well as in several other countries around the world.

Historically, in The United States, these economic theories were employed in The Franklin Roosevelt Administration, during The Great Depression, in the 1930s. And, most recently, starting with The Bush Administration, and increased, exponentially, during The Obama Administration.

I could begin listing a host of reasons why, economically, I don’t believe Keynesian economics is a viable system, however, there are 1000s of books on this subject, and tons of information on the Internet. I would prefer to take a more philosophical approach:

Our founders, in The United States, created a Constitution which clearly limited the powers of The Federal Government; as evidenced by the enumeration of (explicit) powers to Congress, in Article 1, Section 8. And, to The President, in Article 2, Section 1.

Keynesian economics presupposes that our Federal Government can tax the citizens of The United States for any amount they like, and spend it in any way that they see fit! This presumption is not only a subversion to our free-market system, as set fourth by our founders, but it’s also an abridgement to the freedoms of The American people! Every dollar that our Federal Government taxes away from the citizens, is one less dollar the citizens have to feed their families, pay their bills, and create, or invest into, their own businesses – which provides sustainable capital, and employment, for more citizens! There is also a presumption that they, The Federal Government, can mandate and manage the very goods and services that The American people are to acquire!

If our founders were so certain that The Federal Government could solve all problems, they certainly would not have limited it’s powers! And, most certainly, they would not have created a Republic that allowed “free-people” to pursue their own lives, and their own happiness. Clearly, our founders fought a war because of the same style of top down, heavy-handed, government, that made them feel oppressed by Great Britain in the late 1700s!

For anyone who believes a central government can solve all the problems of the it’s citizens, then Keynesian economics may work for you. But, for those who still believe in individual liberty, and the pursuit of happiness, as declared by our founders, then we must see that this growing Federal Government is reduced, exponentially! And, bound by the chains of The Constitution, as conceived by our founders!

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