*controversy

Adding video to channels (Controversy) - requested by MrFisk.

Zakaria makes good points here, but I think he's being too generous to our political parties in suggesting that they actually pick policies based on some sort of economic theory.

Democrats seem afraid to really embrace Keynesian economic theory. If they did, they'd fire back at all this shit about deficits being an urgent problem, and point out that in the short term what we need is a big deficit. They'd also call on the Fed to do everything they can to loosen monetary policy as much as possible. Liberals generally aren't interested in macroeconomics per se. For them, it's more about the moral necessity of promoting a more egalitarian society. That often means setting up public policy that follows Keynesian economic prescriptions, but I don't get the sense that very many Democratic politicians really know much about Keynesian economics, and I can't think of any that call for the government to dogmatically follow it's advice.

Republicans on the other hand clearly don't subscribe to any economic theory in particular. Instead they just latch on to whichever one supports the political maneuver of the day. Republicans may be saying that tax cuts stimulate the economy, but that's only when it's their kind of tax cuts. They claimed the tax cuts in the stimulus wouldn't create jobs because the bulk of them went to poor & middle class people, and because they were temporary. That's primarily a Monetarist view; tax cuts are only stimulative if they're permanent.

Republicans also like to take pages from the Austrian playbook. Much of the fixation on "supply-side" policy requires you make the central Austrian mistake -- believing that supply creates its own demand. Lately we're hearing more and more BS from Republicans about wanting the Fed to tighten up monetary policy, something that's contrary to both Monetarist or Keynesian theories, but fit in just fine with the gold-obsessed Austrian zombies.

Through all of this though, you'll often find Republicans insist we dogmatically adhere to whatever economic principle it is they're parroting at the moment, and it's always fun when a journalist manages to call them out on conflicts between them (e.g. deficits kill jobs, but not when they're from tax cuts?).