by 'Austrian Economics is Nuts ', says Abdul Turay. Abdul Turay is very likeable and entertaining speaker, but although he's bright, he's no academic and in this TEDx talk he's as clear as mud.He was a child during the 70's in London when the unions were at war with the government and so there was loads of strikes. Dustbins (trashcans) weren't being emptied, there was power cuts all the time, and even the grave diggers went on strike so bodies weren't getting buried. Abdul Turay came to the conclusion that socialism was rubbish and so became a conservative.He then says how Milton Friedman was really a Keynesian at heart who believed the government should pump money into the economy when there was a recession and take money out of it when it was overheating. Friedman even believed in
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'Austrian Economics is Nuts ', says Abdul Turay.
He was a child during the 70's in London when the unions were at war with the government and so there was loads of strikes. Dustbins (trashcans) weren't being emptied, there was power cuts all the time, and even the grave diggers went on strike so bodies weren't getting buried. Abdul Turay came to the conclusion that socialism was rubbish and so became a conservative.
He then says how Milton Friedman was really a Keynesian at heart who believed the government should pump money into the economy when there was a recession and take money out of it when it was overheating. Friedman even believed in helicopter money. Turay says that monetarism was very scientific and full of maths, but Friedman also wanted everything to be privatised.
Abdul Turay then moved to Estonia five years ago as a journalist but he has recently become a politician. He says that because of their experience of communism the Estonians are the most anti-socialist county in Europe and hate any government hand-outs - and even if they were starving they would just grow potatoes in the fields.
But as Estonia has the Euro it can't pump the money supply as Friedman would suggest, but also, Estonians are so individualistic that they would not let the government spend any money on them anyway.
Abdul Turay then mentions the Austrian school of economics which uses no maths, he says, but relies instead in 18th century logic. They did work out how the economy will always crash every 9 to 10 years, but they believe the government should spend nothing during a recession which they say would only make things worse. Let everything crash and then it will pick up again, the Austrians say.
Well, with Estonia unable to print its own money and with the Estonians dead against any state spending, the government had no choice but to implement austerity and so it became an experiment in Austrian economics. But it failed terribly wrecking its economy and so Abdul Turay moved to the left to became a social democrat who now believes in the mixed economy.
Austrian economics is nuts, says Tulsay.
He then shows a slide of Paul Krugman, who he says is a very clever economist who showed with very sophisticated maths how countries can trade together to their mutual benefit, but Estonia had proved him wrong, says Tulsay, and so Krugman lost his temper.
So, the best way to do economics is by trail and error to see what works, says Abdul Tulsay.