Keynes vs. Hayek = Obama vs. Merkel?

Anthony B. Kim / June 25, 2010

They are getting together again. This weekend in Toronto, Canada, President Obama and German Chancellor Merkel reconvene at the G-20 Summit to figure out how to move the global economy forward. The two leaders are indeed extraordinary and remarkable in many ways. President Obama is the first African American President while Chancellor Merkel is the first female Chancellor of Germany. Oh, by the way, they are both for “change,” too.

What appears even more extraordinary are their strikingly different choices of economics playbook for “change.”  President Obama has chosen the book of English-speaking John Maynard Keynes and stuck to it. In fact, President Obama once noted in a quite assertive tone, “only government can provide the short-term boost necessary to lift us from a recession this deep and severe.” By contrast, Chancellor Merkel seems to have adopted the book of German-speaking Friedrich von Hayek. (more…)