David R. Henderson  

Great Lines from Bob Lucas

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The first book review I did for Fortune, in 1984, was of Arjo Klamer's Conversations with Economists. In future posts, I'll quote some of my favorite quotes from Bob Solow and from others. Here's my favorite passage from the interview with Bob Lucas.

Klamer: But do you, more or less, agree with Friedman's ideas in Free to Choose or Capitalism and Freedom?
Lucas: I like Capitalism and Freedom a lot. It's really written for economists in a way that Free to Choose isn't. Free to Choose gets careless about a lot of points that Capitalism and Freedom is very careful about. [Henderson's thought: maybe, but there are some pretty careless passages in Capitalism and Freedom. Maybe I'll post on that in the future.]
Klamer: Do you think there are ethical problems in a capitalistic system? Do you think there is something like social injustice?
Lucas: Well, sure. Governments involve social injustice.
Klamer: But doesn't government try to resolve social injustice?
Lucas: That wouldn't be anything like my view. I can't think of the pharaohs as being in existence to resolve social injustice in Egypt. I think they perpetrated most of the injustice in Egypt.

[Klamer then quickly changes the subject.]


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COMMENTS (7 to date)
Jim writes:

If only Lucas had mentioned Hitler, he would have had a rock-solid argument for abolishing every government ever.

Ed Hanson writes:

I noted in your book review, John Taylor was under the category of Keynesian. In your opinion, is he now more Monetarist.

Not having the Klamer book at hand, I would be interested reading excerpts from the Taylor interview.

David R. Henderson writes:

Dear Ed,
I think, and the profession probably thinks, of John Taylor as a New Keynesian. Interestingly, in the interview, Taylor rejected the label of "New Keynesian" but it seemed in part due to his not liking labels. Part of Milton Friedman's tremendous influence, though, was that even Keynesians became monetarists because they came to understand the tremendous potence of monetary policy.
I'll check the Taylor interview for highlights for a future post.
Best,
David

As to David's point about Keynesians becoming Monetarists, Brad DeLong explained it well.


Greg writes:

Yeah, Hitler strikes again. Godwin's Law, anyone?

Sure, governments do lots of bad things, but in my opinion, libertarians often slip into lalaland when going from that government by definition does nothing positive. What about civil rights legislation? Peace-keeping in the Balkans? Natural disaster relief? Medical coverage for the needy? Are you prepared to say that all of these issues would be equally well-addressed in the absence of government? I don't buy it. It's a fallacy that any positive aspects of government are actually the people involved while any negative ones are the government as an entity.

Kurbla writes:

As I pointed already, libertarians typically do one and the same trick, they apply communist arguments against property, but they simply apply it selectively against state property, and not against private property.

In this very example, why Lucas speaks about Egypt as about state governed by Pharaoh, and not about Egypt as private property of Pharaoh? What is the difference?

James writes:

Kurbla,

Libertarians object to rape. Do you find it inconsistent that we don't see rape as a case of the rapist exercising private property rights to his victim? I bet not, because you agree with libertarians that rapists do not actually own their victims. No inconsistency there, right?

Similarly, libertarians don't recognize a Pharaoh as a legitimate owner of Egypt.

Libertarians may be wrong, but to show that you have to point out a problem with what libertarians actually believe.

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