Hutton & Polly v Mises & Milton

Listening to Will Hutton and Polly Toynbee you would think they were actually monetary economists when in reality they are just soundbite savvy talking heads spouting the latest fashions of the metropolitan media elite. Both property millionaires in their own right, three-houses-Polly and Hutton have substantial family stakes in the property market. If they had such great economic foresight would they have got so badly caught out? Rumours circulate as to the viability of Mrs Hutton’s extensive property portfolio.

Toynbee has now realised that Gordon is staying and that her flirtation with David Miliband was just a passing fancy. Her tune has changed, now saying (once again) that Brown is the man for our times when only weeks ago she was telling the cabinet they were spineless not to get rid of him. Laughable.

Polly’s advice and economic genius is as suspect and as reliable as her loyalty to whichever politician she is championing this month. At the beginning of the year she was still loyal to Gordon and chiding Cameron for his new year message which she claimed

smacks of callow point-scoring, with his five repetitions of “Labour’s hopeless” – and it will look even thinner in retrospect in a year’s time if Brown has steered through economic rapids without most voters feeling any adverse effect.

She was confidently predicting

A minor slowdown with neither inflation* nor unemployment rising will see Brown’s old “no boom or bust” boasts triumph this time next year.

Guido suggests we leave Polly and Will to their studio soundbites and ignore their siren voices – they have been advocating their brand of redistributive social democracy as the solution to everything for decades. If policy makers are looking for guidance on avoiding a depression (alas a recession is upon us already) they should dust off the works of Ludwig von Mises and Milton Friedman – Mises wrote the seminalThe Theory of Money and Credit. If this book had been read by more central bankers outside the Bundesbank we would not be in this mess. Guido once listened to an LSE lecture by a Bundesbank board member speaking in reverential tones about Mises’ thinking. He is the high priest of monetary theory.

If history is not to repeat itself then reading Friedman’sThe Great Contraction, 1929-1933should be a priority. If you think this is irrelevant to the state we are in you should note that the current Federal Reserve chairman, Ben Bernanke, pays tribute to this work and is quoted in the introduction to the current edition. Whereas Mises is heavy going, Friedman and Schwartz are essential reading.

Guido can summarise the primary policy response to the situation we are in succintly : cut interest rates, to lessen the pain of the inevitable reckoning.




Tip offs: 0709 284 0531
team@Order-order.com

Quote of the Day

Jeremy Corbyn on Big Ben Bong Ban

“… if we have to miss Big Ben in reality for a while so that work can be done, well, that’s something we have to go through. It’s not a national disaster or catastrophe.”

Sponsors

Guidogram: Sign up

Subscribe to the most succinct 7 days a week daily email read by thousands of Westminster insiders.
Sheerman Lobbying Prompts Calls for Ban Sheerman Lobbying Prompts Calls for Ban
Nasty Nat Picks on Tory MP’s Young Children Nasty Nat Picks on Tory MP’s Young Children
Remain Media Coverage Criticised By Experts Remain Media Coverage Criticised By Experts
Wings Over Scotland Arrested Wings Over Scotland Arrested
Watch and Hear: The Last Chime Watch and Hear: The Last Chime
Bonkers Bong Bowing and Reporting Bonkers Bong Bowing and Reporting
Why Transition Must Be Short Why Transition Must Be Short
PICTURES: Seumas’ Temper Tantrum PICTURES: Seumas’ Temper Tantrum
Don’t Believe ‘Victory For Hammond’ Spin Don’t Believe ‘Victory For Hammond’ Spin
Angry Adonis Wanted ‘Office for Students’ Job Angry Adonis Wanted ‘Office for Students’ Job
City Envoy Slams “Bewildering” Brussels City Envoy Slams “Bewildering” Brussels
Labour Pledged to Sell-Off Public Land Labour Pledged to Sell-Off Public Land
Corbyn’s ‘Local GPs’ Visit Staged by Labour Spin Doctor Corbyn’s ‘Local GPs’ Visit Staged by Labour Spin Doctor
Joly-Gone: Maugham Deletes Centre Party Plan Joly-Gone: Maugham Deletes Centre Party Plan
Milne: North Korea ‘Rational’ to Have Nukes Milne: North Korea ‘Rational’ to Have Nukes
LibDem Chief Exec Out LibDem Chief Exec Out
Jones Ditches Momentum For Radio Show Jones Ditches Momentum For Radio Show
Chlorine Chicken? EU Mired in Food Safety Scandals Chlorine Chicken? EU Mired in Food Safety Scandals
Juncker’s Junkets: Commissioners’ €500,000 Expenses Juncker’s Junkets: Commissioners’ €500,000 Expenses
Owen Jones in for Nawaz on LBC Owen Jones in for Nawaz on LBC