Sad day JQ.
Great man and great contributor to economics literature. He was a powerful and dignified force during the ideological wars of the 1960s / 1970s (after which the profession and policy IMHO divided / fragmented and thereafter lost the plot in terms of working cohesively for the greater good) but Samuelson had already noted the rise of laissez fairism in US policy even earlier in the 1950s.
He wrote the greatest textbooks in economics I have ever read and I am still trying to locate a copy of the 1960 (?4 or 8) something version……I have only ever glanced at a few pages here and there and the eloquence…
Well – Ill be amazed. I didnt actually make that smiley…and Id like to know how I did it!!
Nevertheless the smiley is appropriate.
Yes, a sad day, although he had a good innings, 94.
He and Arrow made prolific contributions and were rightly regarded for their contributions up until the mid-’80s when the chicago collective’s promotion of Friedman et al introduced the notion that analysis and knowing something about economics were unnecessary because the market inevitably solves all problems. A sad shift after the libertarian take over is that their critique that governments don’t really try to do ‘good’ has become a self fulfilling philosophy. Many policy analysts have adopted the idea as their own own working philosophy and don’t even try to do ‘good’ – either because doing good is not one of their interests or they think the quest is infeasible and therefore without merit.
Sameulson was one of the old timers motivated by doing good. Hopefully, there will be a greater appreciation of his contributions in the near future.
I agree with the article that it was more important for Kennedy to cut taxes than to balance the budget. However it would have been better still if both had happened.
What an amazing career. How do you react to the death of omnipresence?
To add to the praise, a small tribute from the far left: If Samuelson hadn’t taken Sraffa and Marx seriously enough to engage with their work and point out all the errors he could find, left-heterodox economists would never have gotten their own theoretical houses in order. Critique from a master like Samuelson strengthens even as it cuts.
0r * Testing or 8
🙂 🙂
Alice the full list of WordPress smilies is available here. I would suggest you accidentally used a numeral 8 followed by the right bracket – ). You’ll have to type slower. 🙄
Thankyou David! /blur – if this doesnt work sometrhing else will
John, anyone that spends their entire adult life making fun of the Austrians & having no interest in Hayek is a friend of mine.
I agree with the article that it was more important for Kennedy to cut taxes than to balance the budget. However it would have been better still if both had happened.
I think that Santa Claus is better than the Easter Bunny, but, gee, it’d be great if the Easter Bunny and the Tooth Fairy combined forces. Who knows what would happen then? Golly gosh, that’s confuse the Libertarian idiots all to heck.
If, on the other hand, Terje, you mean something sensible, e.g., that it would have been good to cut back on military spending, then you should just say that.
If you dislike Santa Claus then you should just say so.
The Kennedy income tax speech is worth listening to.
There was a recession in 1960-61 but Kennedy is talking of tax cuts post recession. This isn’t a Keynesian fixer but a supply-side reform.
“… this could be the most important step we take to prevent another recession”.
It wasn’t a lilly livered temporary tax rebate like some Keynesian economists seem to prefer.
“…a permanent basic reform and reduction in our rate structure.”
He even offers a laffer curve supply-side style argument.
“…creating more jobs and income and eventually more revenue”.
One that probably stack up given how high some of the income tax rates were at the time.
Was the Kennedy tax cut inspired by supply-side thinking? Some people think so:-
“…isn’t a Keynesian fixer but a supply-side reform…”
A tax cut is standard fiscal stimulus Keynesian stuff. A permanent tax cut is fanciful supply-side nonsense. There is a difference. Even if the tax cuts are the same, the thinking is quite different.
Also, the point of a Keynesian stimulus is to create more jobs and incomes which, in turn, will eventually result in more revenue, although the emphasis is on the jobs and incomes rather than the fanciful idea that a permanent tax cut, at any point in a business cycle, will result in an increase in revenue, which is the fanciful supply-side idea.
… the fanciful idea that a permanent tax cut, at any point in a business cycle, will result in an increase in revenue, which is the fanciful supply-side idea
Not everybody finds the supply-side revenue argument that fanciful. This is what some guy called John Maynard Keynes had to say on the subject:-
Nor should the argument seem strange that taxation may be so high as to defeat its object, and that, given sufficient time to gather the fruits, a reduction of taxation will run a better chance than an increase of balancing the budget.
Yes, Keynes was aware of the possibility that taxation could be so high as to defeat its objective. The fanciful idea is that it was so high in the sixties or the eighties. There is a difference between ‘could’ and ‘is’. The supply-side argument is an ‘is’ argument not a ‘could’ argument. The ‘could’ idea was not discovered by supply-siders. The ‘could’ idea was around for a very long time before them. The ‘is’ delusion was their ‘original’ contribution.
The quote was from 1933. As best I can tell the income tax in the UK at the time was much lower than in the USA in the early 1960s or early 1980s. Perhaps you have some historical perspective that differs.
The full quote is as follows:-
Nor should the argument seem strange that taxation may be so high as to defeat its object, and that, given sufficient time to gather the fruits, a reduction of taxation will run a better chance than an increase of balancing the budget. For to take the opposite view today is to resemble a manufacturer who, running at a loss, decides to raise his price, and when his declining sales increase the loss, wrapping himself in the rectitude of plain arithmetic, decides that prudence requires him to raise the price still more and who, when at last his account is balanced with nought on both sides, is still found righteously declaring that it would have been the act of a gambler to reduce the price when you were already making a loss.
@TerjeP (say tay-a)
Nor should it be so low as to defeat the objectives of taxation either Terje. Libertarians who call for lower taxes lower taxes and less regulation less regulation have no end in sight for their objectives except the removal of government in its entirety and that is foolish.
Taxes should be lower than the optimal revenue point simply because we ought to be interested in maximising the sum of both public sector welfare and private sector welfare. And the peak of the laffer curve is only the optimal point for the former not the optimal point for the sum of both.
Perhaps zero government is the objective of some libertarians but we have a long, long, long way to go before we risk having no government. I’d be very content having a government sector about the same size as what we had in 1901. We did not have anarchy in 1901.
Whilst I’m not personally convinced John Humphrey does gives an account of anarchy and it’s viability here:-
The Australian Federal Government may be too big, but Saul sums up pretty well what anarchy looked like during the 19th century. The bit where he talks about how it took a century to sewer Paris is enlightening:
It was the gradual creation of an effective bureaucracy which brought an end to all this filth and disease, and the public servants did so against the desires of the mass of the middle and upper classes. The free market opposed sanitation. The rich opposed it. The civilized opposed it. Most of the educated opposed it. That is why it took a century to finish what could have been done in ten years.
I’m convinced that we’ve already seen what anarchy looks like.
Oops that should have been:
I’m convinced that we’ve already seen what 19th century anarchy looks like.
Regardless of which side of the ideological fence you sit on, I think Samuelson has to be regarded as a genuinely great economic theoretician. From what everyone who knew him says, he also seems to have been a fine human being.
Personally as someone who works in transport, I think his work clarifying what public goods were was great. If only all transport policy makers had read it! 😦
John Quiggin 
Sad day JQ.
Great man and great contributor to economics literature. He was a powerful and dignified force during the ideological wars of the 1960s / 1970s (after which the profession and policy IMHO divided / fragmented and thereafter lost the plot in terms of working cohesively for the greater good) but Samuelson had already noted the rise of laissez fairism in US policy even earlier in the 1950s.
He wrote the greatest textbooks in economics I have ever read and I am still trying to locate a copy of the 1960 (?4 or 8) something version……I have only ever glanced at a few pages here and there and the eloquence…
Well – Ill be amazed. I didnt actually make that smiley…and Id like to know how I did it!!
Nevertheless the smiley is appropriate.
Yes, a sad day, although he had a good innings, 94.
He and Arrow made prolific contributions and were rightly regarded for their contributions up until the mid-’80s when the chicago collective’s promotion of Friedman et al introduced the notion that analysis and knowing something about economics were unnecessary because the market inevitably solves all problems. A sad shift after the libertarian take over is that their critique that governments don’t really try to do ‘good’ has become a self fulfilling philosophy. Many policy analysts have adopted the idea as their own own working philosophy and don’t even try to do ‘good’ – either because doing good is not one of their interests or they think the quest is infeasible and therefore without merit.
Sameulson was one of the old timers motivated by doing good. Hopefully, there will be a greater appreciation of his contributions in the near future.
I agree with the article that it was more important for Kennedy to cut taxes than to balance the budget. However it would have been better still if both had happened.
What an amazing career. How do you react to the death of omnipresence?
To add to the praise, a small tribute from the far left: If Samuelson hadn’t taken Sraffa and Marx seriously enough to engage with their work and point out all the errors he could find, left-heterodox economists would never have gotten their own theoretical houses in order. Critique from a master like Samuelson strengthens even as it cuts.
0r * Testing or 8
🙂 🙂
Alice the full list of WordPress smilies is available here. I would suggest you accidentally used a numeral 8 followed by the right bracket – ). You’ll have to type slower. 🙄
@David C (aka Smiley)
Showoff!*)
@David C (aka Smiley)
AShowoff. 8)
I think Ive got it!
Thankyou David! /blur – if this doesnt work sometrhing else will
John, anyone that spends their entire adult life making fun of the Austrians & having no interest in Hayek is a friend of mine.
I think that Santa Claus is better than the Easter Bunny, but, gee, it’d be great if the Easter Bunny and the Tooth Fairy combined forces. Who knows what would happen then? Golly gosh, that’s confuse the Libertarian idiots all to heck.
If, on the other hand, Terje, you mean something sensible, e.g., that it would have been good to cut back on military spending, then you should just say that.
If you dislike Santa Claus then you should just say so.
The Kennedy income tax speech is worth listening to.
There was a recession in 1960-61 but Kennedy is talking of tax cuts post recession. This isn’t a Keynesian fixer but a supply-side reform.
“… this could be the most important step we take to prevent another recession”.
It wasn’t a lilly livered temporary tax rebate like some Keynesian economists seem to prefer.
“…a permanent basic reform and reduction in our rate structure.”
He even offers a laffer curve supply-side style argument.
“…creating more jobs and income and eventually more revenue”.
One that probably stack up given how high some of the income tax rates were at the time.
Was the Kennedy tax cut inspired by supply-side thinking? Some people think so:-
@TerjeP (say tay-a)
“…isn’t a Keynesian fixer but a supply-side reform…”
A tax cut is standard fiscal stimulus Keynesian stuff. A permanent tax cut is fanciful supply-side nonsense. There is a difference. Even if the tax cuts are the same, the thinking is quite different.
Also, the point of a Keynesian stimulus is to create more jobs and incomes which, in turn, will eventually result in more revenue, although the emphasis is on the jobs and incomes rather than the fanciful idea that a permanent tax cut, at any point in a business cycle, will result in an increase in revenue, which is the fanciful supply-side idea.
Not everybody finds the supply-side revenue argument that fanciful. This is what some guy called John Maynard Keynes had to say on the subject:-
@TerjeP (say tay-a)
Yes, Keynes was aware of the possibility that taxation could be so high as to defeat its objective. The fanciful idea is that it was so high in the sixties or the eighties. There is a difference between ‘could’ and ‘is’. The supply-side argument is an ‘is’ argument not a ‘could’ argument. The ‘could’ idea was not discovered by supply-siders. The ‘could’ idea was around for a very long time before them. The ‘is’ delusion was their ‘original’ contribution.
The quote was from 1933. As best I can tell the income tax in the UK at the time was much lower than in the USA in the early 1960s or early 1980s. Perhaps you have some historical perspective that differs.
The full quote is as follows:-
@TerjeP (say tay-a)
Nor should it be so low as to defeat the objectives of taxation either Terje. Libertarians who call for lower taxes lower taxes and less regulation less regulation have no end in sight for their objectives except the removal of government in its entirety and that is foolish.
Taxes should be lower than the optimal revenue point simply because we ought to be interested in maximising the sum of both public sector welfare and private sector welfare. And the peak of the laffer curve is only the optimal point for the former not the optimal point for the sum of both.
Perhaps zero government is the objective of some libertarians but we have a long, long, long way to go before we risk having no government. I’d be very content having a government sector about the same size as what we had in 1901. We did not have anarchy in 1901.
Whilst I’m not personally convinced John Humphrey does gives an account of anarchy and it’s viability here:-
http://blog.libertarian.org.au/2009/12/14/another-look-at-anarchy/
The Australian Federal Government may be too big, but Saul sums up pretty well what anarchy looked like during the 19th century. The bit where he talks about how it took a century to sewer Paris is enlightening:
I’m convinced that we’ve already seen what anarchy looks like.
Oops that should have been:
I’m convinced that we’ve already seen what 19th century anarchy looks like.
Regardless of which side of the ideological fence you sit on, I think Samuelson has to be regarded as a genuinely great economic theoretician. From what everyone who knew him says, he also seems to have been a fine human being.
Personally as someone who works in transport, I think his work clarifying what public goods were was great. If only all transport policy makers had read it! 😦