Speaking of Hitler-as we did in the last post
Sumner likens MMT to Hitler
http://diaryofarepublicanhater.blogspot.com/2014/03/sumner-throws-some-cold-water-on-tom.html
his name came up in Richard Koo's The Macroeconomic Holy Grail where he made the quote in the aobve title in reference to Hitler in the 30s.
http://www.amazon.com/Holy-Grail-Macroeconomics-Lessons-Recession-ebook/dp/B006ES4UX0/ref=sr_1_1?s=books&ie=UTF8&qid=1395138649&sr=1-1&keywords=richard+koo pg. 4929 of 7542
I actually find the subject of the Nazi economy very interesting and actually bought a book about this just last week.
http://www.amazon.com/Wages-Destruction-Making-Breaking-Economy-ebook/dp/B008DR6YXO/ref=sr_1_1?s=books&ie=UTF8&qid=1395139068&sr=1-1&keywords=nazi+economy
I can imagine Sumner if he saw this: 'Aha I told you they're Hitler!' However, for me it really does touch on a very vexing topic that isn't discussed too much because of just how malign the Hitler regime was-calling it the 'wrong political agenda' as Koo does is kind of an understatement! For that matter I don't know that we can say he had the right economic policies-as one policy was forced labor-those who didn't work were simply executed-for whatever reason.
Still there's no question that the economy got well under Hitler after a terrible economy under Chancellor Bruning-he believed in fiscal austerity in the middle of a recession too. So there-if Sumner must play this gotcha game, there's something he and Bruning agree on and this led to Hitler. Incidentally one of the biggest fallacies out there-I've heard it from Internet Austrians-is that hyperinflation led to Hitler-yet this was 7 years earlier than the brutal German depression. Actually I saw Major Freedom us a more sophisticated version of this argument recently-he admitted that it was the deflation that led to Hitler but that the necessity of this deflation was the previous hyperinflation which somehow made austerity inevitable.
Koo's reference to 'the Holy Grail' is I believe an allusion to Bernanke who calls explaining the Great Depression as the HG of economics. I think that's right but I also would say that explaining the Nazi economy as a research project of considerable consequence for econ as well.
P.S. I just published this post and then thought of Tom Brown when'I looked at my title. Yes, I made another typo and this one not a minor one either that I could laugh off. I had put in 'the Right Economic Policies but the Right Political Agenda. Tom says he notices typos in the title mostly because he feels bad for the author. I have to agree with him this time: this particular typo would have been embarrassing!
Sumner likens MMT to Hitler
http://diaryofarepublicanhater.blogspot.com/2014/03/sumner-throws-some-cold-water-on-tom.html
his name came up in Richard Koo's The Macroeconomic Holy Grail where he made the quote in the aobve title in reference to Hitler in the 30s.
http://www.amazon.com/Holy-Grail-Macroeconomics-Lessons-Recession-ebook/dp/B006ES4UX0/ref=sr_1_1?s=books&ie=UTF8&qid=1395138649&sr=1-1&keywords=richard+koo pg. 4929 of 7542
I actually find the subject of the Nazi economy very interesting and actually bought a book about this just last week.
http://www.amazon.com/Wages-Destruction-Making-Breaking-Economy-ebook/dp/B008DR6YXO/ref=sr_1_1?s=books&ie=UTF8&qid=1395139068&sr=1-1&keywords=nazi+economy
I can imagine Sumner if he saw this: 'Aha I told you they're Hitler!' However, for me it really does touch on a very vexing topic that isn't discussed too much because of just how malign the Hitler regime was-calling it the 'wrong political agenda' as Koo does is kind of an understatement! For that matter I don't know that we can say he had the right economic policies-as one policy was forced labor-those who didn't work were simply executed-for whatever reason.
Still there's no question that the economy got well under Hitler after a terrible economy under Chancellor Bruning-he believed in fiscal austerity in the middle of a recession too. So there-if Sumner must play this gotcha game, there's something he and Bruning agree on and this led to Hitler. Incidentally one of the biggest fallacies out there-I've heard it from Internet Austrians-is that hyperinflation led to Hitler-yet this was 7 years earlier than the brutal German depression. Actually I saw Major Freedom us a more sophisticated version of this argument recently-he admitted that it was the deflation that led to Hitler but that the necessity of this deflation was the previous hyperinflation which somehow made austerity inevitable.
Koo's reference to 'the Holy Grail' is I believe an allusion to Bernanke who calls explaining the Great Depression as the HG of economics. I think that's right but I also would say that explaining the Nazi economy as a research project of considerable consequence for econ as well.
P.S. I just published this post and then thought of Tom Brown when'I looked at my title. Yes, I made another typo and this one not a minor one either that I could laugh off. I had put in 'the Right Economic Policies but the Right Political Agenda. Tom says he notices typos in the title mostly because he feels bad for the author. I have to agree with him this time: this particular typo would have been embarrassing!
Nice... I'm happy you caught that one. :D
ReplyDeleteI came across the following passage in Adam Tooze’s “The Wages of Destruction: The Making and Breaking of the Nazi Economy” recently.
ReplyDelete“What is unmistakable is that in both 1933 and 1934 there was a powerful ‘natural’ recovery in the German business sector. In 1933 investment expenditure-mainly in stock building-was a major driver of the recovery. The first signs of of this upswing had underpinned the strange wave of optimism that befell the Weimar Republic shortly before its demise. After 1933 government left such a deep imprint on the evolution of the economy that talking about the continuation of the ‘natural recovery’ is a degree speculative. We cannot know with any certainty what might have happened if a different government had been in power. However, the signs of continued upswing in German business are there in the statistics…”
He goes on to give specific examples.
Well, Adam Tooze is a very fine historian, but he is clearly not an economist.
Currency controls were imposed in July 1931, effectively taking Germany off the gold standard 18 months before Hitler became Chancellor. This freed the Reichsbank to pursue expansionary monetary policy, which according to Peter Temin, it had started by at least the summer of 1932. The League of Nations Statistical Yearbook states that Germany’s industrial production reached bottom in August 1932 and had already increased 6.8% by January 1933, the month Hitler entered office.
By April 1934, when Germany issued its first MEFO bill, and started running its first “large” deficit (about 5.4% of GDP in FY1934 according Albrecht Ritschl, counting the “shadow” budget), industrial production was already 45.8% above the level it had been in August 1932.
What Adam Tooze calls a “natural recovery” I call good monetary policy. You may not see it, but it’s there.
Well Mark first of all you have me at a disadvantage in that I haven't started it yet. I'm still finishing off Richard Koo-though I am very much looking forward to this book.
ReplyDeleteI can't say I'm surprised that it turns out that Hitler too was a Market Monetarist. Maybe Sumner should rethink likening MMers to Ghandi and MMters to Hitler-LOL.
As I said:
Delete"Currency controls were imposed in July 1931, effectively taking Germany off the gold standard 18 months *before* Hitler became Chancellor."
Still you read me just enough but not too much so that you didn't spoil it for me. I'll see if I take it quite like you do.
ReplyDelete