In his article "The Nuttiness of Negative Interest Rates" Robert P. Murphy on Mises Institute web-site wrote that
"In his April 18 New York Times op-ed, Harvard professor (and Bush adviser) Greg Mankiw calls on the Federal Reserve to promise future inflation, in order to fix the economy. Mankiw's article beautifully illustrates what is wrong with today's economics profession: it consists of very sharp guys (and gals) who can develop interesting models that spit out policy recommendations that would destroy the economy. It is no coincidence that Mankiw's worldview leads him to literally propose destroying the currency in order to fix the economy."
It is not surprising that the proposal of literally destroying currency comes from an American professor of one of the leading universities. An economics professor is the ultimate union of Kant and Keynes. Kant laid the foundation for the destruction of human mind and Keynes followed closely with his own recipe for the destruction of the capitalism.
The collectivist view that the economies resources are somehow their responsibility, to be managed and disposed off as they like is the dominant theme of the article. So what if the problems were caused during this management as pointed out by the author which Mankiw conveniently refuses to address. Though I am no great authority on economics, even with my basic knowledge, I can recognise the ugly mishmash of non-reason and anti-capitalism coming together in this call to destroy what Rand said was "the ultimate barometer of a society's virtue"- the money.
Read a part of the speech made by Francisco d'Anconia, Galt's friend on the meaning of money:
"Whenever destroyers appear among men, they start by destroying money, for money is men's protection and the base of a moral existence...
To the glory of mankind, there was, for the first and only time in history, a country of money: a country of reason, justice, freedom, production, achievement. For the first time, man's mind and money were set free, and there were no fortunes-by-conquest, but only fortune-by-work, and instead of swordsmen and slaves, there appeared the real maker of wealth, the greatest worker, the highest type of human being-the self-made man-the American industrialist.
If you ask me to name the proudest distinction of Americans, I would choose-because it contains all the others-the fact that they were the people who created the phrase "to make money.""
"The Atlas Shrugged" by Ayn Rand.
In America today, the phrase "to make money" is losing it's shine. The strangled free-market system is under a renewed and a more vigorous assault. The solutions which are proposed by the current administration are going to push the existing mixed-economic system dangerously close to Socialism. It is the system which is depressingly familiar to those Objectivists living in third-world countries. My overwhelming concern is that when I come to America, I hope it doesn't resemble the place I have left behind.
The proposed solution to solve the current crisis, of encouraging households and businesses to borrow and spend with the helpful dose of inflationary currency as proposed by the Harvard economist is not a new one. Ayn Rand wrote in her "Capitalism: The Unknown Ideal" in October 65 that "there are economist who proclaim that the essence (and the moral justification) of capitalism is "service to others-to the consumers," that the consumers wishes are the absolute edicts ruling the free market, etc. (...what all such theorists fail to mention is the fact that capitalism grants economic recognition to only one kind of consumer: the producer-that only traders, i.e., producers who have something to offer, are recognized on a free market, not "consumers" as such-that, in a capitalist economy, as in reason, in justice, and in reality, production is the pre-condition of consumption.)"