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Quotation of the Day…

… is from page 279 of The State Is Rolling Back, which is volume 2 in the 2004 Liberty Fund series The Collected Works of Arthur Seldon; specifically, it’s from Seldon’s 1988 essay “Policies: The Difficult and the ‘Impossible'”:

Keynes’ prescription has been shown to be not only defective in economic analysis.  The public choice analysis of Professors J. M. Buchanan and Richard Wagner has also shown it to be politically unrealistic.  Politicians have to deal with the public not only in the market process, as buyers or sellers of products or services, but also in the political process, as voters and electors.  If it was politically naive to assume that workers would accept reductions in real wages in the short term it was no less politically unrealistic to assume that politicians would faithfully operate budget surpluses in the long term to remove inflation once budget deficits had created them.

Despite some careless grammar, Seldon here summarizes one very important reason why Keynesian economics is far less scientific than its adherents think it to be.  Keynesians unscientifically assume one of the conclusions that they mistakenly believe themselves to have established through rigorous analysis, namely, that empowering government to ‘manage’ aggregate demand is the most feasible means of achieving, over the long-run, appropriate levels of aggregate demand.