Page 84 - TrumpsEconEra_Flat

Chapter 3: The Choice is Ours to Make

protect incumbent producers have compounded the
problem of insufficient growth. For example, France
has made free shipping from Amazon illegal to aid
French businesses. At the same time, there has been a
movement away from private to public enterprises.
When funding comes from the government, political
goals often supersede growth policies.

Growth is the only way out of Europe’s debt
quagmire. The Keynesian consensus, which has
dominated world economic councils, believes growth is
mostly a function of government spending (even if it
necessitates a tax hike) and that spending cuts are
tantamount to lower growth. This Keynesian emphasis
on public expenditure is a top-down approach to the
economy, whereas Austrian economists tend to favor
policies that grow the economy from the bottom-up.
Austrians believe that slumps are inevitable and the
ebbs and flows of economic activity are normal.
Austrians support small government and
Keynesians favor big government. Austrians see a
problem when governments are intrusive and
unpredictable. President Trump supports fewer and
simplified regulations, a tax code that we can
understand, and permanent tax cuts.
Despite these shortcomings, Keynesian policies
are the norm today, but Trump’s agenda could help
push us in a different direction similar to the Reagan
presidency. President Ronald Reagan supported
Austrian economics in the 1980s and was a student of
F.A. Hayek. He often warned us against planned
economies and often quoted F.A. Hayek’s book The
Road to Serfdom.

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