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Keynesian modelling relies on marginal propensity to consume and marginal propensity to invest. The idea that if we give more money to the poor, they have a propensity to consume that's much higher than the wealthy, though I wish they would talk to my wife about that; she seems to have a propensity to consume.

The real problem is deflation. That is the opposite of inflation but equally serious to the borrower.

Keynes eliminated economic theory's ancient role as spoilsport for inflationist and statist schemes, leading a new generation of economists on to academic power and to political pelf and privilege.

In the '30s, the Keynesian stuff worked at least in the sense that you could print money without inflation because there was all this productivity growth happening. That's not going to work today.

Keynes's contribution was not just to advocate spending government money in the middle of a recession. Every government had done that going back to the days of the Irish potato famine. What he gave to us was a way of thinking about the magnitude and the dimensions and so forth.

Keynesian economics has always been needed.

Popular as Keynesian fiscal policy may be, many economists are skeptical that it works. They argue that fine-tuning the economy is a virtually impossible task, and that fiscal-stimulus programs are usually too small, and arrive too late, to make a difference.

The Keynesian prescription for unemployment rests on the persistence of a 'money illusion' among workers, i.e., on the belief that while, through unions and government, they will keep money wage rates from falling, they will also accept a fall in real wage rates via higher prices.

Even if the government spends itself into bankruptcy and the economy still does not recover, Keynesians can always say that it would have worked if only the government had spent more.

Reagonomics - a blend of monetarism and fiscal Keynesianism swathed in classical liberal and supply-side rhetoric - is in no way going to solve the problem of inflationary depression or of the business cycle.