Maynard Keynes and economics revisited

John Maynard Keynes' economic theory fueled the approach to market management between the 1930's until the Reagan era. In this article, the author argues that Keynes would have a better understanding of what just happened in the US than most modern economists. It makes for interesting reading, even if you don't agree.

Since the 1980s, the vogue has been Reaganism, which is actually based on Milton Friedman's ideas of economics, and is often posited as a theory that contradicts Keynes. Of course, such claims of mutual incompatibility are usually proferred by those with political axes to grind. From a purely positive economic perspective their theories are largely compatible, with a few adjustments.

Fiscal and monetary policies are just different levers. They have differences, which make them more or less efficacious in different situations. Ignoring one in favor of the other, or just being profligate and irresponsible with either one could have disastrous consequences. In the current situation, the US was irresponsible on both.