From Russ Roberts:
Seems to me that there is no evidence that having the federal government borrow lots of money and spending it has been very effective. Certainly, the predictions of the effect of that spending by its proponents have been very inaccurate.
From Brad DeLong:
The situation cries out for aggressively expansionary monetary and fiscal policy.
Appropriately, even though he wasn’t responding to DeLong, Roberts titled his blog post, “When Dogmas Collide.” So who’s dogma has the upper hand? I tend to side with Roberts, finding the Keynesian approach that DeLong calls “macroeconomics 101,” but I’ll admit that the current situation, coupled with my own incomplete understanding of macroeconomics, makes me nervous enough that I don’t hold great confidence in my position.
Unfortunately, Roberts is correct to write of “dogmas”–I’m not finding much in the economic blogosphere that approaches good direct thoughtful consideration, analysis, and rebuttal of each others’ sides on this issue. One without rancor (or at least minimal rancor), but where each side tries to explain very clearly where they think the other side is wrong.
I wonder if I could get Roberts and DeLong to do that here?