“Fear the Boom and Bust,” Hayek vs. Keynes, a rap-off

NPR’s Morning Edition featured profiles of three figures in American economics this week, Ayn Rand, Friedrich von Hayek, and John Maynard Keynes.

The Keynes piece featured excerpts of the YouTube video below — so I’m reposting my original post of the rap from a year and a half ago.  It’s salient now, more than it was then.  However, a post at the blog of the Center for Economic and Policy Research (CEPR) suggests Keynes’s legacy is much greater than this series lets on.  What do you think, Dear Reader?

This is really good.

It’s a pretty good rundown of the fight between Keynes and Hayek, conducted mostly after Keynes’ death in economics classrooms and central banks world wide.

Watch it, and hope for more soon, at Econstories, the blog of the guys who created the thing, John Papola and Russ Roberts.


10 Responses to “Fear the Boom and Bust,” Hayek vs. Keynes, a rap-off

  1. Black Flag® says:


    So, as long as you become rich, tryanny is just fine!

    Wonderful set of principles you have there, Ed!


  2. Ed Darrell says:

    When the poor of the world become rich, so do I.


  3. Black Flag® says:

    … as if being such a thing is a worthy goal

    Great! You’re the tyrant! Guess that makes you a proud American, huh? …even if it bankrupts you.


  4. dr says:

    Yeah, we find ourselves suffering from being the world’s pre-eminent global power and leader.

    Thank you Mr. Keynes for making that possible.!


  5. […] “Fear the Boom and Bust,” a rap-off (video featuring rap duel between Keynes and Friedrich von Hayek) […]


  6. Black Flag® says:


    What??? Hayek’s has not failed!

    It hasn’t been tried.

    Since 1913, we have been under 100% Keynesian … so I can’t imagine how you might attribute things to Hayekian thought….


  7. Alan Scott says:

    Since 08 we seem to have had a failure of both Hayek and Keynes. Hayek’s free market philosophy failed and allowed Keynesians under Obama to get power. They have also failed and power may swing back to the Hayek free marketers .


  8. Black Flag® says:


    I have read, probably, all of Keynes’ work.

    His other works are clear, concise, well argued (though refutable), like his original “Theory of Money” – Hayek refuted him, and Keynes wrote back “Oh, I discarded that theory a long time ago”.

    But his “General Theory” is totally incomprehensible – it is utter gibberish.

    I mean, read this:

    On the other hand, the detail of his diagnosis, in particular the so-called A + B theorem, includes much mere mystification.

    If Major Douglas had limited his B-items to the financial provisions made by entrepreneurs to which no current expenditure on replacements and renewals corresponds, he would be nearer the truth.

    But even in that case it is necessary to allow for the possibility of these provisions being offset by new investment in other directions as well as by increased expenditure on consumption.

    Major Douglas is entitled to claim, as against some of his orthodox adversaries, that he at least has not been wholly oblivious of the outstanding problem of our economic system. (General Theory, pp. 370—71)

    Total gibberish, Ed.

    Why would an incredibly intelligent man whose previous work is elegant, readable, and understandable, write such gibberish?

    Because he needed it to be gibberish.


  9. Ed Darrell says:

    You should read Keynes sometime, Black Flag. You’ll be surprised, if you’re expecting to find what you describe in Keynes’s writings.


  10. Black Flag® says:

    They do have an update – called “Round Two”

    In the Science of Economics, Keynes is without a doubt the most influential non-economist in history – and probably the most influential person in economics in history as well – up to now.

    His theories are crackpot – based on the platform originally conceived by another economic crackpot, Irvine Fisher (the man who invented the Rolodex).

    Keynes was lucky – his essays came out just at a time government interventionism in the economy was wrecking its terrible consequences, ….and then he died.

    At his death, Hayek stopped refuting Keynes’ work – erroneously thinking such an irrational tome would fade without the personality of Keynes to continually reinforce it.

    But government seized Keynes work as it justified government interventionism at a time the economy was reeling from the wreckage of government intervention.

    Without Hayek refutations, there was no resistance… “You can’t beat something with nothing” and Keynes ideas took quick hold.

    Academia, dependent on government money, became the apologists for government interventions, and quickly embedded Keynesian as essentially the only economics taught.

    We find ourselves suffering the consequences today.


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