Little or nothing - from Warren Meyer writing at Coyote Blog:
Question for Keynesians: What Are You Doing To Prepare for the Next Cycle?
When I was in school learning macro 101 from Baumol and Blinder, my memory is that the theory of Keynesian stimulus and managing the economic cycle was that deficits should be run in the bottom part of the economic cycle, paid for with surpluses in the top half. So we are now almost certainly in the top half of the cycle. But I don't hear any Keynesians seeking to run a surplus, or even to dial back on government deficits or spending. In fact, our Keynesian-in-chief says he is done with "mindless austerity" and wants to start spending even harder in 2015.
Its enough to make one suspicious that all the stimulus talk is just a Trojan Horse for a desire to increase the size and power of government.
But for Keynesians who really believe what they are saying, that deficit spending somehow saved us from a depression in 2009 and 2010, then I ask you -- what are you going to do next time? It appears that when we enter the next recession in this country, that US debt as a percentage of GDP is going to be almost twice what it was entering the last recession. Don't you worry that this limits your flexibility and ability to ramp up deficit spending in the next recession?
More at the site - check out the comments too - some excellent points being made including this one which echos my own thoughts:
Far be it from me to defend Keynes, who even when read correctly is still wrong...but they're not Keynesians. They're state-worshipers usurping the name of a dead economist to give extra credibility to their religion, while adopting only that portion of his ideas which are useful to their present political desires, and ignoring the larger share which is inconvenient to those desires. (That would be the bit about paying off, during times of prosperity, the public debt that one accumulates during times of hardship by supposedly "counter-cyclical" spending, rather than using that prosperity as an excuse to go on an even bigger spending spree.)
Exactly - the religion of Progressivism. I am old-school Austrian. F.A. Hayek, Milton Friedman, Henry Hazlitt
Of course, these two videos bear watching.
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