Let me take you to the article by Ross Gittens today displaying his typically ignorant views on the economy. But if he is going to invoke Keynes to explain anything, let me remind you that no one who uses Keynesian economics to explain anything ever gets it right. Evil Lord Keynes flies to rescue of disbelieving Liberals. This is what Gittens wrote:
When we entered lockdown in March this year, many people (including me) pooh-poohed Scott Morrison’s assurance that the economy would “snap back” once the lockdown was lifted. Turned out he was more right than wrong.
We could, of course, compare what I wrote on March 26 on the AIER website: A Classical Economic Response to the Coronavirus Recession.
That is why when I hear discussions of the need for a stimulus I am even more than usually amazed at how beyond sense economic policy has become. What is needed, and what is largely being done, are measures to hold both capital and labour in place until the closures are brought to an end. There are businesses that will open the moment the law allows. There are millions of jobs that will be immediately filled again the moment these businesses reopen, which will see their customers flooding back. The aim of policy is therefore to maintain a holding operation on business and to ensure workers who are being temporarily displaced can purchase necessities.
Back in March, as Gittens himself emphasises, he had no idea that the economy might “snap back” once the lockdown was lifted, but that’s precisely because he is a Keynesian who has no idea how a market economy works.
BTW have I ever mentioned the book I published this year: Classical Economic Theory and the Modern Economy. It is unbelievable how ignorant of economics a modern economist is.