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George Selgin Profile picture
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3 May, 5 tweets, 1 min read
What Nathan dismisses as a @m
What Nathan dismisses as a myth here was accepted by scholars and observers of all persuasions at the time and long since. It is he who is promoting a myth of near complete recovery before the ‘37 crash.
Relief and recovery were very distinct objects. The New Deal programs were successful in one. Less so in the other. No toying with statistics will change that reality.
More here: alt-m.org/2020/06/16/the…
Not sure what happened here. But I meant to say that FDR stresses the distinction between recovery and relief, and that the older “unemployment” numbers, though better called “unemployment plus relief employed,” serve as a better measure of the progress of recovery.

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More from @GeorgeSelgin

George Selgin Profile picture
5 May
In the Spring of 1941, @zachdcarter observes in his excellent book, _The Price of Peace_, Keynes's "marked emphasis on inflation surprised some of the economists, who, after so many years of depression, were still focused on employment as the topic national economic concerns. ...
"But with the war orders coming in on a massive scale, Keynes insisted that is was only a matter of time until rapid price increases took effect. Americans would need to prepare to have a battle plan ready when they did."
The most recent stats then available (for March 1941) put the 12 month CPI inflation rate then at 2.26%--its highest level since 1937. This March the 12 month CPI inflation rate was 2.6%--its highest level since August 2018.
Read 8 tweets
George Selgin Profile picture
3 May
My sincere desire (and I think Nathan will agree) is that we go beyond both sweeping celebrations and sweeping condemnations of the New Deal to better understand both its successes and its failures.
Too much “mythologizing” infects both extreme views. Take one simple myth both sides subscribe to: that the New Deal was inspired by Keynes’ ideas. One side celebrates it for this foresight; another confirms it as it does Keynesianism writ large.
In fact, Keynes had little influence on the New Deal; while he praised some aspects of it, he was highly critical of others as impeding recovery. FWIW, my own view is that, had his advice actually been heeded, we’d have seen a much more rapid and complete post-1933 recovery.
Read 4 tweets
George Selgin Profile picture
21 Apr
This is...it's...I mean...ah, what's the use?
Still I'll try: monetary expansion DOES create wealth when it prevents what would otherwise be a shortage of exchange media. Such a shortage can result in recession and unemployment. That is, it can destroy wealth. Monetary expansion adds to wealth by preventing that outcome.
Economists of practically all schools have long understood this exception to the rule that monetary expansion only causes inflation. I mean economists going back to G. Poulett Scrope and John Stuart Mill! It is not just a "Keynesian" idea, though he shared it.
Read 7 tweets
George Selgin Profile picture
13 Apr
Thread: I have great respect for @dandolfa. But I think that here he, like many other proponents of CBDC, too readily assumes that it can be viewed as a "public option," that is, something costless to a public that doesn't have to use it if it doesn't wish to.
That perspective is misleading for several reasons. First, and most obviously, it overlooks the fact that CBCD is seen by many of its advocates as a substitute for official paper currency, not a supplement to it. Rogoff famously views it so. amazon.com/Curse-Cash-Lar…
So do many central bankers who view the switch as a means for assisting negative interest rate policy, among other things.theblockcrypto.com/post/84516/deu…
Read 21 tweets
George Selgin Profile picture
2 Apr
Thread: Goodness knows, I've tried!
My first, and most complete effort to explain why a stable NGDP path is better than a stable P path is here: amazon.com/Less-Than-Zero…
Don't let the title mislead you: when I write it in the 90s I was responding to the then-popular Monetarist ideal of a stable price level. So I compared it to a policy that had NGDP grow steadily with weighted factor input. That would mean deflation roughly = -TFP growth rate.
Read 10 tweets
George Selgin Profile picture
1 Apr
Some fun facts you probably didn't know about the gold standard:

(1) It's heyday was the the middle ages:
(2) It was abolished by the Federal Reserve Act:
(3) That was in the 70s:
Read 12 tweets

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