Galbraith seems the last man to cite in order to back a view that a modern economy cannot be controlled.
Galbraith was totally wed to the vision that government can run an economy well.
So thanks to people like Galbraith and media types who took him seriously, many Americans now think the President (or FRB Chmn) runs the economy as if they had a console and joystick at their desks to do the job.
Any FRB Chairman’s statements show that they are trying to sound knowledgeable when their statements are no more than guesswork.
Then too, President readily claim credit for a good economy yet duck any suggestion of being tied to bad economic results. Claiming credit is like the bird-brained rooster who thinks his crow raises the Sun.
Obama became President after the stock markets reflected housing finance excesses, that occurred earlier.
Clinton rode the top of prosperity as we spent the Peace Dividend after the USSR’s collapse ended the Cold War.
A sound-minded person in a situation they barely grasp will try to take the fewest risks until they can make better sense of the situation. This rules out most Presidents, FRB Chairmen, and key law-makers who sit on Congress’s important committees.
Since neither policy-makers nor politicians know how our economy will evolve in five years, nor ever know how the economy works enough to plan it, the smart approach is to be build flexibility into the budget and be very careful with spending.
[Currently our national budget is less a plan for financing the next year’s estimated needs than a plea to pay off prior spending. In other words, Congress’s approach to spending is the same as the rich college kid’s, whose parents automatically cover her prior month’s bills.]
Politicians esp in the US assume progress and good outcomes are guaranteed and that resources are effectively limitless. This is abs. reckless.
Read Confessions of Congressman X. Its unidentified author is a Dem who thinks many of his colleagues and many of us voters live in a fantasy.
Truth is resources are still limited and always will be. And government is not their best allocator.
But free markets never work for deciding some situations. Such decisions are rightfully government’s which is why we even set up governments.
Finally, markets that should be free are now massive and hard to keep functioning right without sensible regulations