He seems to be suggesting here that fiscal policy is better for achieving certain policy aims:
"In the first place, all the aims of inflationism can be secured by other sorts of intervention in economic affairs, and secured better, and without accidental effects. If it is desired to relive debtors, moratoria may be declared or the obligation to repay loans may be removed altogether; if it is desired to encourage exportation, export premiums may be granted: if it is desired to render importation more difficult, simple prohibition may be resorted to, or import duties levied. All these measures permit discrimination between classes of people, branches of production, and districts, and this is impossible for inflationary policies.'
"Inflation benefits all debtors, including the rich, and inures all creditors, including the poor; adjustment of the burden of debt by special legislation of differentiation. Inflation encourages the exportation of all commodities and hinders al importation; premiums, duties, and prohibitions can be employed discriminatorily."
Mises "The Theory of Money and Credit." pg. 120.
http://www.amazon.com/Theory-Money-Credit-LvMI-ebook/dp/B004GHNMT4/ref=sr_1_1?s=digital-text&ie=UTF8&qid=1390409325&sr=1-1&keywords=mises+the+theory+of+money+and+credit
I'm not saying he was a Keynesian-he certainly ascribed to be anything but However, he does sound more Keynesian than Monetarist here does he not? This passage also gets me thinking about something else Austrians believe in: Cantillion effects-that it makes a difference where in the economy money is injected-Monetarists think it's irrelevant.
Here he sounds like he's saying that fiscal policy does less harm and has an actual chance at achieving it's stated aim.
UPDATE: Mises goes on to say that 'inflationism'-that is to say monetary policy is bad policy, "because it's incapable of fully attaining its goal and because it leads to consequences that are not, or at least not always, part of its aim. The favor it enjoys is due solely to the circumstance that it is a policy concerning whose aims and intentions public opinion can be longest deceived. It's popularity, in fact, is rooted in the difficulty of fully understanding its consequences.'
"In the first place, all the aims of inflationism can be secured by other sorts of intervention in economic affairs, and secured better, and without accidental effects. If it is desired to relive debtors, moratoria may be declared or the obligation to repay loans may be removed altogether; if it is desired to encourage exportation, export premiums may be granted: if it is desired to render importation more difficult, simple prohibition may be resorted to, or import duties levied. All these measures permit discrimination between classes of people, branches of production, and districts, and this is impossible for inflationary policies.'
"Inflation benefits all debtors, including the rich, and inures all creditors, including the poor; adjustment of the burden of debt by special legislation of differentiation. Inflation encourages the exportation of all commodities and hinders al importation; premiums, duties, and prohibitions can be employed discriminatorily."
Mises "The Theory of Money and Credit." pg. 120.
http://www.amazon.com/Theory-Money-Credit-LvMI-ebook/dp/B004GHNMT4/ref=sr_1_1?s=digital-text&ie=UTF8&qid=1390409325&sr=1-1&keywords=mises+the+theory+of+money+and+credit
I'm not saying he was a Keynesian-he certainly ascribed to be anything but However, he does sound more Keynesian than Monetarist here does he not? This passage also gets me thinking about something else Austrians believe in: Cantillion effects-that it makes a difference where in the economy money is injected-Monetarists think it's irrelevant.
Here he sounds like he's saying that fiscal policy does less harm and has an actual chance at achieving it's stated aim.
UPDATE: Mises goes on to say that 'inflationism'-that is to say monetary policy is bad policy, "because it's incapable of fully attaining its goal and because it leads to consequences that are not, or at least not always, part of its aim. The favor it enjoys is due solely to the circumstance that it is a policy concerning whose aims and intentions public opinion can be longest deceived. It's popularity, in fact, is rooted in the difficulty of fully understanding its consequences.'
There's a PDF of that book at this link:
ReplyDeletehttp://mises.org/books/tmc.pdf
Those quotes are on page 230 of that pdf/translation.
TK for the link
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