5 thoughts on “Hayek v. Keynes, Round Two

  1. As another contender to Keynes, in the same league as Hayek, and in the same generation, may I suggest Jacques Rueff. A co-founder of the Mont Pelerin Society with Hayek, he is best known for his views on monetary policy.

    He coined the phrase: “… a deficit without tears” to characterize what the reserve currency role of the USD in today’s international monetary system allows. It is the central point of the recent OpEd piece Lewis Lehrman contributed to the WSJ: Monetary Reform: The Key to Spending Restraint – Paul Ryan’s plan won’t succeed without legislation to prevent the Federal Reserve from monetizing the national debt. Its significance is fully developed in testimony Lehrman gave some six weeks ago to the House Subcommittee on Domestic Monetary Policy & Technology: The Monetary Problem and its Solution in Historical Perspective.

    A full account of Rueff’s challenge to Keynes is told in Christopher Chivvis’s The Monetary Conservative: Jacques Rueff and Twentieth-Century Free Market Thought. The differences between them first emerged when as young officials in their respective government delegations, they participated in the Paris Peace Conference after WW I and those that followed in the 20s to rebalance the international monetary system. Citing Chivvis’s book, a comment to a column on David Warsh’s Economic Principals site: “Now the Real Work Begins” relates these differences to the “competitive devaluations” that characterize today’s international economy.

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