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  • VIDEO: Hayek vs. Keynes Rap Battle Royale

    It’s not Eminem or Dre, not East Coast or West. It’s economists Hayek and Keynes, and Congress can’t decide who gets it best. They’re battling it out on the mean streets of DC, to see who can fix the economy….

    Sometimes, the best way to get a point across is to bust a rhyme, and the floors of Congress are no exception. This week, EconStories.tv released its new video, “Fight of the Century,” featuring economists John Maynard Keynes and Friedrich August Hayek bringing the heat during a congressional hearing.

    Keynes, a British economist in the early half of the twentieth century, advocated government intervention, over-regulation, and spending to boost the economy.  Hayek, an Austrian-born twentieth century economist, defended free-market capitalism against these assertions, arguing that the economy cannot be forced in one direction or another based upon basic algorithms.

    Keynes and Hayek obviously butted heads, but they might be surprised to see themselves duking it out in the boxing ring or busting moves that would make Usher blush.  Nevertheless, the beats in this video reflect the ongoing battle between the two schools of thought.

    Unfortunately for those of us who experienced the failure of President Obama’s Keynesian stimulus plan to spur recovery after the “Great Recession,” Keynes and Hayek never agreed on how best to reverse an economic downturn.  As Hayek laments in the video, “We brought out the shovels but we’re still in a ditch…And still digging, don’t you think it’s time for a switch?”

    We sure do.  Watch the video and decide for yourself whether the U.S. is currently on the road to serfdom or the path to prosperity as a result of recent economic policies.

    What do you think of the video? Which economic school of thought do you think wins out? Join in with a comment below!

    Posted in Economics [slideshow_deploy]

    9 Responses to VIDEO: Hayek vs. Keynes Rap Battle Royale

    1. Roger, Boise Idaho says:

      The video is awesome, and the battle is no contest Hayek wins huge KO!

    2. Redfray, Pea Ridge, says:

      One of the greatest stories ever told , is who is right. Man does not seem to learn anything in his short life here on earth. No algorithms will ever predict how mankind thinks. That is not a common divisor that will ever stay common. Our observation of the passed has a blur, that never reasons with what we are thinging until it is over. Without a common reminder of the passed constantly slapping us, we do what we want and believe. To bad we can't all be raised the same where everything is equal and just.

      Even now with the trouble about to destroy our American country, its still, who is the best to be the winner of this game. Yet, we are all losers in the end, one way or another.

    3. John says:

      Great video! The Austrian school is the correct one and is growing all the time. Keynesian economics always fails, whether it be Roosevelt, Bush, Obama, whoever. Keynesianism gives capitalism a bad name.

    4. Mike, Flordia says:

      The ONLY way to recovery is a full reset of the government back to a VERY basic constitutional republic like it was 200 years ago and let the people rule for themselves. Drop welfare, drop social security, drop 99% of what the government puts its hands into.

    5. Scott Jones, Sachse, says:

      It's nice to know we can stop for a laugh on the Road to Serfdom. Hayek certainly understood what ails us today. How can any rational person think the solution to $14.3 trillion in debt is more spending? It doesn't work in your home, and it won't work in your government – unless of course a totalitarian state is your real goal.

    6. Roger S., Mass. says:

      Neat video! Keynes and Hayek each arise from diametrically opposed assumptions about the role of government in our lives, by consequence in economic matters.

      Keynes' tacitly assumes a "command and control" form which, due to the nature of markets, –hundreds of thousands linked through millions of participants, each in more than one market at a time and each variously as producer and consumer– creates the need for more regulation each and every time it attempts to regulate. That appears to work, for a while, but incurs deferred costs, with interest: the cost of regulation itself and the cost of market distortions introduced by the necessarily imperfect regulations and their unforeseen (and often unforeseeable) consequences. That gives the "illusion of solving the problem" while in fact the solutions are being perpetually "kicked down the road".

      Works "great" in command and control types of Crony Capitalism; until the whole miserable house of cards thus created implodes. Sound familiar?!

      Hayek's assumption is governmental "laissez-faire" capitalism. Government neither favors nor penalizes economic activities, and to the extent it must be involved as a market participant (of necessity in endeavors such as the criminal and civil justice systems, national defense, a few others) it participates with as even a hand as possible. Common sense indicates that in such an environment there is a great incentive for resource misallocations to be corrected much more rapidly. Fewer distortions result in the long term, and any governmental "handling charges" simply never exist. Can't sound familiar because we haven't seen it in the U.S.A. for nearly a century!

      The apparent perennial "struggle" between both systems seems to arise from the fact that neither can be perfect among real people in a real world. Keynes' command and control can never be complete because people will forever do whatever seems necessary to "survive" and prosper, regardless of legal mandates. Hayek's can never be perfectly laissez-faire because a government will always be a powerful participant in a large variety of markets simply as a consequence of performing its mandated functions.

      So the choice will always boil down to the peoples' constant vigilance to keep their government's mandated functions small and few, so as to ensure as by-products the maximum of real individual liberties together with the maximum of attainable economic freedoms. These three things appear inextricably linked. Thus "The Road to Serfdom" was as aptly named as could be. Hayek wins!

    7. Bennet Cecil says:

      Very enjoyable. Next one should show how printing currency raises prices and steals from workers and savers. Show keynes printing barrels of money for politicians and bankers while workers cannot afford food and gas. Show the money coming out of their pockets as the inflation tax. Dress Keynes as a highwayman robbing people by making their money worthless.

    8. Sanjeev Sabhlok says:

      Sadly, the reality is that Hayek finishes a poor fourth after Keynes, Friedman and Samuelson among top economists in USA. No wonder American policy is such a mess (see my post at :http://sabhlokcity.com/2011/05/the-keynesians-have-hijacked-america-leaving-the-field-open-for-nations-that-follow-good-policy/).

      In the real world not many who care about good policy. Short-term advantage seems to matter most.

    9. nicholas wapshott says:

      If you want to know what really happened in the original debate between Keynes and Hayek, my Keynes Hayek: The Clash That Shaped Modern Economics is published by W.W.Norton in October.

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