Keynesianism Is Dying
A Double-Dip Recession
by Gary North
Promoting a revamped Keynesian economic theory – one without any guarantee of job growth – is the equivalent of selling a lifetime subscription to a revamped Playboy: one without any photos. It’s a tough sell. Yet this is what Keynesians are facing today. This will be fun to watch.
In the last few days, we have begun to see reports from mainstream Keynesian forecasters and economists who are talking about the possibility of a double-dip recession.
For a year, we have been assured by experts that double-dip recessions are rare. They surely are. The last one was in Carter’s final year, 1980 – which is why it was his final year – and Reagan’s first year, 1981. As far as the National Bureau of Economic Research has reported, that was the only double-dip recession. The NBER is the unofficial arbiter of each recession’s chronology.
A few forecasters a year ago predicted the ever-popular V-shaped economic recovery. They are all hoping that no one remembers. There is no one left standing who predicts anything like this. The economy has barely grown over the last year, and the most recent report from the government is that growth was slower than initially reported for the second quarter of this year.