"We're All Austrians Now:" Economics on the Campaign Trail
Austrian economists Joseph Schumpeter and Friedrich Hayek lived and worked in the late nineteenth and mid-twentieth centuries. But today's U.S. Republican presidential candidates are citing their free-market ideas on the campaign trail this year: one has cited his abiding faith in "creative destruction;" another says "we're all Austrians now." But what insights can we really derive from long-dead economists? Kojo talks with economist Russ Roberts about the uses (and abuses) of economics on the campaign trail.
Guests
Schumpeter, "Creative Destruction," and "Vulture Capitalism"
Republican presidential candidate Mitt Romney has endured attacks on the campaign trail about his previous career in the private equity industry. In particular, critics have accused him of engaging in a kind of "vulture capitalism," pillaging distressed companies for personal enrichment. Romney and his defenders have evoked the concept of "creative destruction." First popularized by Austrian Economist Joseph Schumpeter (1883-1950), "creative destruction" posits that innovation in a capitalist system often involves painful upheavals as inefficient companies give way to newer companies and business models.
Hayek vs. Keynes: A Hip Hop Battle
The "Austrian School" commonly refers to a group of twentieth century free-market economists including Ludwig von Mises (1881- 1973) and Friedrich Hayek (1899-1992). Hayek's writings, in particular, challenged the influential work of British economist John Maynard Keynes (1883-1946).
John Papola and guest Russ Roberts created a series of "hip hop" videos exploring the competing ideas of Hayek and Keynes:
Are We All Austrians Now?
Republican Presidential Candidate Ron Paul routinely evokes Hayek and the Austrian School. In a speech after the Iowa caucuses, he even claimed that "we're all Austrians now:"
Paul's invocations of the Austrian School have provoked a variety of reactions, both negative and positive.
Comments
Please familiarize yourself with our Code of Conduct and Terms of Use before posting your comments.
Are Mises and Rothbard even going to get a mention?
How can people disregard Austrians when there have been so many great insights by Austrian economists? For example, the marginal theory of value completely destroyed the labor theory of value. But yet Carl Menger is an afterthought among Keynesians and completely unknown among regular folks.
"Ron Paul supporters speak in almost conspiratorial terms about the Federal Reserve." -Kojo
What do you call a meeting on Jekyll Island where legislation for the Federal Reserve was drafted? Why not discuss this (the legislation that created the Fed) in the house of Congress where legislation is supposed to originate? Why pass the bill on Christmas eve when Congress was on recess? Come on Kojo, report on the true history, don't make comments that play off the conspiracy stereotype.
"the Federal Reserve Act passed Congress on a Sunday two days before Christmas when most of Congress was on vacation." Come on Kojo, why does an listener have to call you out on the facts.
Allowing your guest characterize Ron Paul's ideas as creepy is low for your show. I really thought that your show was a neutral venue where ideas could be expressed openly. Now I see that you utilize the same simplistic arguments to malign Ron Paul as biased news outlets like the Washington Post, Times, Daily Bull, I mean Beast.
I appreciate your effort to elucidate the issues being discussed on the campaign trail, but please don't bias your audience with childish arguments like someone's ideas being creepy. Leave your personal biases off air. You can support whomever you choose off air, but on air you have a responsibility to provide information to the public so they can make an informed decision.
You do good work Kojo. I know you do your best. My comments are in defense of an unbiased discussion of ideas instead of the repetition of stereotypes.