Ah, a pre-emptive rebuttal to my posting of the Stockman piece as more evidence of stealthflation. It has been so ubiquitous I didn't even need to blockquote it here myself.
The key criticism seems to be whether America's sun has set or is merely on its way down. Either way, JimiP advocates for, what, keeping it at 7 pm? That's his happy vision for America's future? I engage in innovation and creation while someone else gets rich? Whatever happened to the American dream?
He's probably done a poor job articulating McCloskey's "deal" but that's on him. I can only critique what he says, not what he wanted to say.
I'm suggesting (and think I could get Pethokoukis and Kudlow to back me up) "Don't fight the tape!"
JimiP has an illustrious history of championing free market principles, and works tirelessly to preserve the dream of free markets. As he and I share an appreciation for Ms. McCloskey, let me attempt to paraphrase (taking on Harvard Professors, besting a Jeopardy! champ will be easy).
McCloskey answers the economists' question of why France is not in worse shape than it is. Not to say it leads the world, but from a policy-based, economic standpoint, it should be waaaaay worse. McCloskey's point is that as long as the bourgeois have a chance, they will create and the rest will enjoy the benefits.
That does not make it right. And I am very comfortable suggesting that more-free nations have done better. But Canada and Sweden lumped through their überprogressive periods, and France hangs on because the markets are far more resilient than folks like you and I will admit.
More Dagny Taggarts than John Galts.
We could have certainly done better without eighty years of progressivism. We could have done a lot goddam better without Mister Stockman's tax hikes (not that I hold a grudge!!!!!) But while saying that today is the day it all ends sells books and pleases conservative bloggers, I accept Pethokousis's larger premise that if we survived FDR and LBJ and Fed Chair Arthur Burns, we'll likely get past Misters Obama and Bernanke.
Fair defense, but let me attempt an alternate view of the big picture:
The drag of statism on the world economy has, over the past eighty to a hundred years, been carefully balanced by market forces in both economics and politics such that productivity and prosperity generally trended upwards.
Over the same period, most nations tended to be more statist and less free than did the good ol' USA, but since the USA was so big and so prosperous (and so #@$(*ing generous) the world managed to avoid slipping into a modern dark age of "equality."
Propelled by the "success" of statism in Europe a surging Progressive movement has gained traction in the world headquarters of capitalism - America. Defended only by the idea that "I'll make you rich too if you let me make myself rich" capitalism is under existential threat by the idea "nobody needs to be rich."
I submit that JimiP and Ms. McCloskey have no answer for the day when the statists decide that two centuries of prosperity are enough - time for us all to be "equal" wherever that may lead."
Stockman's answer, despite his many past sins and even some in his prescription, is "getting the Fed out of the financial markets" because it "is the only way to put free markets and genuine wealth creation back into capitalism."
He doesn't want to END the Fed, but to restore its original mission: "To provide liquidity in times of crisis."
With what part of this would Uncle Milton disagree?