It’s Hayek’s World, the U.S. Government Just Spends in It

As the guilty flee when no man pursueth, so do the statists see
Austrian economists’ cold dead hands trying to take away their
(metaphorical, until they are literal) guns when our country’s
politicians are all too prepared to Keynesian manage their way to
all of our graves.

See
E.J. Dionne in yesterday’s Washington Post:

today’s conservatives are in thrall to Austrian thinking, and
this explains a lot of what is going on in Washington. Broadly
popular measures such as raising the minimum wage and extending
unemployment insurance — normal, bipartisan legislation during the
Keynesian heyday — are blocked on the assumption that people are
better off if the government simply keeps its mitts off the
market.

It is now difficult for Congress to pass even the kind of
spending that all sides once saw as necessary public investment in
transportation, research and education. It’s that “road to serfdom”
again: Anything government does beyond enforcing contracts and
stopping violence is denounced as the first step of a fox trot
toward dictatorship.

So let’s give Ron Paul credit for unmasking the true source of
gridlock in Washington: Too many conservatives are operating on the
basis of theories that history and practice have discredited. And
liberals have been more reluctant than they should be to call the
ideological right on this, partly because they never fully got over
the shell shock of the Reagan years and also because they have a
strange aversion to arguing about theory. When it comes to
government policy, the Austrian economists paved the road to
paralysis.

Hm, what did the Congressional Budget Office say about government
spending last week? “Federal outlays are expected to increase
by 2.6 percent this year, to $3.5 trillion, or 20.5 percent of
GDP—their average percentage over the past 40 years. CBO projects
that under current law, outlays will grow faster than the economy
during the next decade and will equal 22.4 percent of GDP in 2024.”
Is this a government gridlocked, prevented from functioning?

And is asking, as congressional Republicans are, for offsetting
cuts elsewhere before voting for unemployment extensions truly a
sign of embracing Austrian warnings about the bad effects of
messing with free markets and market clearing in a way someone not
desperate for a column hook would recognize?