Ep. 41 Karl Smith, of the Blog “Modeled Behavior,” Has Friendly Debate With Bob On Keynesian Stimulus and Carbon Taxation
Bob has a friendly discussion/debate with Karl Smith. First Bob pushes Karl to clarify the conditions under which government deficit spending could, even in theory, help a depressed economy. Then they switch to the economics of climate change, and Bob’s view that the case for a carbon tax is much weaker than most economists admit.
Mentioned in the Episode and Other Links of Interest:
- Karl Smith’s article archive at Bloomberg.
- Karl’s twitter account.
- Bob and Karl’s live (online) debate.
- Bob’s (co-authored) Cato article critiquing a carbon tax.
- How you can contribute to the Bob Murphy Show.
The audio production for this episode was provided by Podsworth Media.
About the author, Robert
Christian and economist, Chief Economist at infineo, and Senior Fellow with the Mises Institute.
Haha must’ve downloaded an earlier version? The entire intro and Bob’s parts were missing, so it was just silence and Karl talking to himself.
Who added Bob Murphy into this Karl Smith solo show?
This is excellent. Thank you to Bob for asking questions respectfully, without strawmanning Karl in the slightest.
Thank you Karl for cogently explaining how you see the secondary effects of the dislocations play out. I wish all discussions were this good.
In many ways it’s a bit like the climate debate – Economists differ in how they think the secondary and tertiary effects of various pushes to a dynamic system can be effected by twiddling the dials. It got deep enough into the weeds so I will need to listen again.
I feel like I am getting good value for my donation to the Bob Murphy show.
[…] My conversation with Karl Smith. It may lead you to think about fiscal stimulus in a new […]
A thought occurred to me while listening to this episode, that was reinforced when listening to the episode with Steven Patterson. I don’t mean to pick on Karl Smith, since this critique applies to all statists (or more specifically, academics who advocate state intervention in monetary policy), but there is a bit of hypocrisy in their argument, when they both emphasize the importance of their research and also recognize the limitations of their information.
The importance of their work is pretty obvious, since they devoted their life to this work, and also if they have any awareness of 20th century history can see the effects of bad monetary policy. At the same time, they presumably recognize the limitations of understanding economic data (the entire discussion with Steve Patterson can be applied here).
So the problem I have here and see as a hypocrisy is recommending a course of action that has at least a small, but not insignificant, probability of leading to hugely disastrous results. This, in my opinion, can only be justified if either the status quo is unacceptable, or if the possible positive outcome is so great as to outweigh the potential disaster. I believe this is why we are seeing revisionist history on the left both trying to emphasize how terrible the status quo is and also downplaying or completely denying both the tragedies of communism/statism and minimizing the amazing global achievements of capitalism, liberty and Western culture in general. I think this is an attempt (possibly subconscious in some cases) of reconciling this hypocrisy of recommending state intervention while understanding how absolutely terrible that “road to serfom” can be.