How Karl Marx Foresaw Bernanke and Krugman
by Gary North
Hegel remarks somewhere that all great world-historic facts and personages appear, so to speak, twice. He forgot to add: the first time as tragedy, the second time as farce.
So wrote Karl Marx in the opening lines of The 18th Brumaire of Louis Bonaparte (1852).
In modern economic theory, the tragedy was the tag-team of John Maynard Keynes and his interpreter, Paul Samuelson. The farce is the tag team of Ben Bernanke and his interpreter, Paul Krugman – Princeton University’s two most famous economists.
Ben Bernanke is the first classroom economist to be Chairman of the Board of Governors of the Federal Reserve since the pipe-smoking Arthur Burns. There have been no others.
PROFESSOR BURNS GOES TO WASHINGTON
Burns took over at the FED in early 1970. He held the position until early 1978. It was under him that Nixon experienced the 1969-70 recession and then killed the last remains of the 1922 gold exchange standard on August 15, 1971.
Burns had begun his years in Washington in early 1953, when he took over as the third Chairman of the Council of Economic Advisers. In that capacity, he oversaw the 1953 recession, the first recession since 1937. He held that position until 1956.
In 1975, he oversaw Ford’s recession.
So, he was a major adviser in four recessions, a feat unmatched by any other academic figure. Burns was the president of the National Bureau of Economic Research from 1957 to 1967. This non-profit research organization is the agency that officially decides when a recession began and ended. It got to do this four times when Burns was a senior economic adviser to the Presidents involved.