Wilton, It’s Not Just the MSM that Doesn’t Understand Economics

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It’s apparently also the Harvard Business School (well, OK, like everyone here didn’t see that coming!). I subscribe the the HBS Working Knowledge e-newsletter. It often has neat things about entrepreneurs, innovation, etc. Today’s lead article was intended as a primer on macroeconomics (and a book promotion). Reading Dr. Moss’s “A Macroeconomic View of the Current Economy” was not fun. Moss genially explains a third pillar of recession (after output and [central bank] money) as “negative expectations,” saying, “That’s why in some cases you need either a very aggressive monetary policy or large-scale deficit spending, which is what we’ve seen this past year. Both aggressive monetary easing (lower interest rates) and large-scale deficit spending send the signal that demand will increase, and thus both aim to break the cycle of negative expectations about the economy.” In the next breath he describes that how we think about foreign direct investment is “…political…and above [his] pay grade.” I’m sorry to say I shot off an email to the HBS saying they were just plain stupid. I wished I could have made myself critique the publication more politely, intelligently, and reasonably, but I couldn’t. Happily, we know the revolt is well-fueled and well underway when we simply have no time for respected institutionally-correct statists — in the MSM or academia.

9:20 pm on January 25, 2010