Paul Krugman has this perfunctory way of dismissing the Nobel Laureate economist Milton Friedman and his monetary economic analysis when espousing exclusively Keynesian solutions. China for example has pretty much followed the big government directed spending dictum prescribed by Keynes since the financial crisis of 2008 and yet now find itself in a recession where too much was invested in unwanted assets and a leadership that appears to be at its wits’ end as what to do about it. They need an expertise to best allocate resources to provide the maximum public good. It's the missing element in Keynes’ theory and it will take a catharsis for China’s authoritarian government to understand that their few experts don’t hold a candle to the swarm of individual players trading freely among themselves in a system with a rule of law that protects property rights. It already exists in Hong Kong but Xi Jinping's assertion of his power is strangling the golden goose that all of China should emulate.
No comments:
Post a Comment