Dan Walters: Governor becomes a Keynesian

Sacramento Bee ^ | 2/2/9 | Dan Walters

[SmithL]

Arnold Schwarzenegger came into the governorship as a fervent disciple of free market economist Milton Friedman.

When Friedman died in 2006, the governor declared him "one of the great thinkers and economists of the 20th century, and when I was first exposed to his powerful writings about money, free markets and individual freedom, it was like getting hit by a thunderbolt."

Five years into his governorship, however, Schwarzenegger has morphed into an acolyte of Friedman's chief rival in the arcane field of macroeconomics: John Maynard Keynes, who advocated government spending to ease economic recession.

As the New York Times obituary of Friedman put it: "Flying the flag of economic conservatism, Mr. Friedman led the postwar challenge to the hallowed theories of Lord Keynes, the British economist who maintained that governments had a duty to help capitalistic economies through periods of recession and to prevent boom times from exploding into high inflation. In Professor Friedman's view, government had the opposite obligation: to keep its hands off the economy, to let the free market do its work."

Schwarzenegger's shift of allegiance has fully flowered as the state copes with what may be the worst recession since the Great Depression. The governor is pleading with President Barack Obama and Congress for billions of dollars to finance what he says are nearly $30 billion in "shovel-ready" public works projects while pushing the Legislature to speed up highway construction and other infrastructure financed with the $40-plus billion in bonds that voters approved in 2006.

The spending, he said, would slow California's soaring unemployment, now among the worst in the country and headed for double-digit levels. The state had 1.7 million unemployed workers in December, up by more than 600,000 from December 2007.

Philosophy aside, would massive public works spending make a significant dent...

[absalom01]

Arnold and 0 seem determined to repeat all of the economic mistakes of the Roosevelt Administration. Now that’s depressing.

[Trod Upon]

Cheer up—WWIII is probably right around the corner!

[Jaxter]

Isn’t that what 0bama is? Never mind. I thought it said Kenyan.

[Arthur McGowan]

Keynesianism isn’t economics. It’s an elaborate ideological rationalization for what government wants to do anyway: Steal.

[wastoute]

Perhaps the governor should consider moving forwards in his theories instead of backward. What he has done is the equivalent of moving from Copernican astrophysics to Galilean Kinematics. He might want to instead move forward at least to Newtonian Calculus if not Quantum Mechanics. Instead he will go to Zero with his hat in his hand and beg for money. Why do politicians have to be so g-danged stoopid? But I repeat myself when I say stupid politician, I suppose.

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[Amerigomag]

Why, oh why, does McClatchy employ this putz?

Walters drones on for 10 paragraphs, tied to Keyens, and finally admits the one truth in this article ... in the very last sentence of the charade:

Longer-term recovery is utterly dependent on Friedman's markets turning around and producing growth in private sector activity.