Collapsonomics libretto

Here is the libretto for the opera
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COLLAPSONOMICS

It’s the BBC program – HARDtalk
The stage is made to look like a TV studio. The interview is filmed in front of a live audience.
A simple three chairs arrangement is the main set-up; the moderator sits in the middle, the guests to his left and right. A small coffee table is positioned in front of them.

The moderator/presenter is Tony Major; a fast talking, no-nonsense jerk.
The guest to his right is F.A. Hayek, a professor of economy and a Nobel Prize winner.
The guest to his left is J.M. Keynes, a professor of economy.

In the background we see a video screen with the Dictionary Scrutinizer – a singing oracle that erases words out of the dictionary/language. The Dictionary Scrutinizer controls the proceeding in the studio without being there physically. (It is the invisible hand of the market.)

Before HARDtalk starts we hear the Dictionary Scrutinizer.

Dictionary Scrutinizer:
Good evening ladies and gentlemen
the good citizens of our global shopping mall
this is the Dictionary Scrutinizer
tonight we get rid of the word
RECESSION
there is no recession, no
re, re, re, re, cession
so, put on your weekend outfit
and go hopping into shopping…

We hear the opening music for HARDtalk followed by the show’s opening titles.
A voice is heard via the loud speakers.

Voice:
Ladies and gentlemen
he is fearless
he is sharp
he has a lethal tongue
he is quick as a gun
he is the one and only
Tony Major

Tony Major enters to the sounds of prerecorded applause.

Tony Major:
Welcome to HARDtalk! The one hour interview program that is the result of
detailed research and in-depth investigations. Yes, in-depth investigations.
HARDtalk asks the difficult questions and gets behind the stories that make the
news – from international political leaders to entertainers; from corporate
decision-makers to ordinary individuals facing huge challenges. Yes, yes, yes,
yes, everyone, sooner or later, ends up here on the hot seat of HARDtalk…
(prerecorded applause)
Tonight we have a treat. Here, in this studio, in a moment, we will have two of
the biggest minds in economics. The Tweedledum and Tweedledee of modern
economy. So, it is my pleasure to introduce: To my right, the man who was a
pioneer in monetary theory and one of the principal proponents of classical
liberal thought in the twentieth century. He is a co-winner of the Nobel
Memorial Prize in Economic Sciences and the recipient of the Medal of
Freedom. Milton Friedman calls him a mentor and a friend. He is Friedrich
August von Hayek.
(Hayek enters, prerecorded applause)
To my left, the man who is widely considered to be the father of modern
macroeconomics, and by some the most influential economist of the past
century. Time magazine included him in their list of the hundred most important
and influential people of the twentieth century. Virginia Woolf called him a personal friend. He is John Maynard Keynes.
(Keynes enters, prerecorded applause)

The three are seated around the coffee table.

Tony Major:
Good evening, let me just start by stating how happy I am to have both of you here. it is a real treat. Historians have always been fascinated by cyclical theories of history. Societies are said to swing like pendulums between alternating phases of vigor and decay, progress and reaction, promiscuous times and puritanism. A political-economical cycle can be described as a continuing shift in national involvement between public purpose and private interest. The swing is between liberal (what Europeans would call social-democratic) and conservative epochs. The idea of the ‘crisis’ is central. Liberal periods succumb to the corruption of power, as idealists turn into comfortable couch potatoes, and conservative arguments against rent-seeking politicians win the day. But the conservative era then succumbs to a deregulation to rip off the public. A crisis of under-regulated markets presages the return to a liberal era.
So,Gentlemen! What causes the swing? Why do economies fall into depression? Why do central bankers have power over the economy, insofar as they do? Why are there people who can’t find a job? Why is there a tradeoff between inflation and unemployment in the long run? Why is saving for the future so arbitrary? Why are financial prices and corporate investments so volatile? Why do real estate markets go through cycles? What is the reason for the crisis? Why does poverty persist for
generations among disadvantaged minorities?

Dictionary Scrutinizer:
Good evening ladies and gentlemen
The good citizens of our
Global dancing hall
This is the Dictionary Scrutinizer
tonight we get rid of the word
poverty
there is no poverty, no
po, po, po, vert y
so, put on your dancing shoes
and dance, dance, dance

Tony Major:
Ok, strike out the last question. But gentlemen…What is the reason for this crisis? Why does the economy work on cycles?

Hayek:
Why? Why? Why?
things go up
things go down
it’s cyclical

The economy
fixes itself
sooner or later
it’s cyclical

The economy
is self-regulating
like a sick person
it’s self-healing,

The economy
has
an automatic adjustment mechanism

so
things go up
things go down
it’s cyclical

but, the economy
is like a thermostatic system
sometimes it has
very high, very high
very high fever

but
it automatically adjusts
its temperature
it automatically adjusts
its temperature
to any change in
the weather

so
things go up
but then
they go down
and life becomes
balanced again
because
it’s cyclical, it’s cyclical

Tony Majoor:
Yes, but are you implying that everything is just a minor hiccup, a slight adjustment of the economic thermostat?

Hayek:
Yes, yes, yes
in my picture
of economic life
the world, yes
the whole wide world
is inhabited by
atomic individuals
atomic individuals
each of whom
knows what he wants
and how to get it
knows what she wants
and how to get it

So, you see
the market always
corrects itself
it is up
it is down
but it
always corrects itself
it always corrects itself

Tony Major:
How?

Hayek:
As wages and prices do not adjust
output does
cycles are due not to
temporary deviations
from an optimal
level of output
but to
fluctuations in the
level of
potential output itself

Tony Major:
But how do you explain the repeated business-cycle fluctuations?

Hayek:
The cycles are just
sequences of real shocks
to productivity
which reverberate through
the economic system
rece … sorry wrong word
sorry sorry
Economic decline and
periods of high growth
are the efficient response
to changes in the real
economic environment

Tony Major:
It is only a theory. We cannot base our whole economy on a theory.

Hayek:
But that is
what makes
a theory
a real theory
in the real world
Changes might involve
oil prices,
regulations,
weather conditions,
but in theory you can predict.

Keynes:
Let me disagree.

Tony Major:
Disagree please, please disagree

Keynes:
The flaw of these models
is that they
assume that someone
the credit customer,
the insurance buyer
someone
possesses perfect information
however,
the present crisis shows
that we are in a world of
uncertainty, uncertainty
with the blind leading the blind
it is a crisis of
symmetric ignorance
symmetric ignorance
not
asymmetric information
not
asymmetric information

Tony Major:
Are you calling the bankers blind? You think they shoot into the dark?

Keynes:
The bankers
were not only greedy
but phenomenally skilled
at self-deception

Tony Major:
So who knows? Who has the answer?

Keynes:
If only one person
were perfectly informed
there could never be
a general crisis.
but the only
perfectly informed person
is God,
and God does not
play the stock market.
no,
God
does not play
the stock market.

Hayek:
We don’t need God
when the whole wide world
is inhabited by
atomic individuals

Tony Major:
Mr Keynes, do you share this notion of the atomic individual, the self-correcting mechanism?

Keynes:
The future is
a twilight zone
a dark uncertain
twilight zone

It is full of
unexpected
unpredictable
events

This is why
why, why

things go down
things go up
we just don’t know why?
we just don’t know why?

Tony Major:
I thought your job is to tell us why, to know the ups and downs.

Keynes:
If A owes B money
and B owes it to C
and C to D
and D to E
and E owes to F
and so on, and so on
the failure of A
may involve
the failure
of the whole
series

so
A and B
C and D
E and F
all failed

they are not
atomic individuals
they are just
uncertain creatures
living in an
economic twilight zone
economic twilight zone

things go down
things go up
we don’t know why
we don’t know why

Dictionary Scrutinizer:
Gentlemen, gentlemen,
why do we need
the word: WHY?
Why? Why? Why
confusing ourselves
with why
tonight we get rid
of the word
WHY
There is no why
no, no ,no, no, why
so, put on your best suit
and
buy, buy, buy
Don’t ask why?
just
buy, buy, buy

Tony Major:
I have to say that my life just became hell without the word why. Why is the most important word in my profession. I am an interviewer, I have to ask questions! What am I going to do without Why?

Dictionary Scrutinizer:
Mr Major,
you are violating the last order.
didn’t we make it clear!
no why, no more W, H, Y,
end of story
find some more
positive alternatives
satisfying solutions
constructive proposals
happy endings

Tony Major:
But gentlemen, what causes the ups and downs? Isn’t it your job as economists to minimize the chances of another recession… Sorry, sorry, strike the word recession. I will rephrase the question. Isn’t it your job to minimize the possibility of another financial meltdown?

Hayek:
As i said before
market participants
have
perfect knowledge
of
future events
perfect knowledge
of
future events

They face
only, only, only
measurable risks

market participants
in
making investments
they are like
life insurers
they know
the odds

Keynes:
No, no, no, no
market participants face
irreducible uncertainty
they face
irreducible uncertainty

they have
no basis
on which
to calculate
the risks

They have
no basis
on which
to calculate
the risks
they face
in making
an investment

Hayek:
They know, they know
They know, they know

Keynes:
They don’t know, they don’t know
They don’t know
they are
plunging
into the unknown

Hayek:
No, no, no, no
They are like
life insurers
They know
the odds

Keynes:
No, no, no
It is all one big
casino
one big
casino

Tony Major:
Mr Keynes, are’nt you taking it a little bit too far? Are you saying that the whole Western world industry became the by-product of a casino? Is our economy just a game of roulette? We are all just full-time gamblers?

Keynes:
Luck plays a much
greater role
in success or
failure

Luck plays a much
greater role
in success or
failure

We only find
the causes
after the facts

or, let me correct myself
we invent the causes
after the facts

Tony Major:
Mr Hayek, is it all just luck?

Hayek:
No, no, no
There is no luck
in business
there is no luck
in business
just common sense

There will never be
a shortage of demand
for the products of
industry

Supply creates its
own demand
supply creates its
own demand
supply creates its
own demand

Keynes:
Total demand
could fall short
of
total supply

Tony Major:
Yes, but we do have to define what we mean by supply and demand.

Keynes:
Total demand
could fall short
of
total supply

Tony Major:
But, do you not agree we first need to define supply and demand?

Keynes:
And people
yes
real people
find themselves
without work
and money
to buy supply

Hayek:
If wages and prices were
completely flexible,
there could not be
persistent unemployment.

Tony Major:
But we do have unemployment, how do you explain it?

Hayek:
Widespread ignorance
about future events
could make people
slow
to adjust to change
and therefore
unemployment could
persist for some time
but only
for some time

Major:
That’s the reason the government, the state, to….

Keynes:
… why government is justified
In intervening to
provide employment

Hayek:
But see
what happens
if you abolish
the ignorance assumption
if you assume
that everyone
everyone
has perfect information
about future events

Tony Major:
Are you dreaming of a world without ignorance?

Hayek:
The sluggishness disappears
wages and prices will
adjust instantaneously
to new conditions
because these conditions
will have been
anticipated and
will already be incorporated
in the prices which
people charge
and expect to pay
for their services
No departure
from real long-term values
is possible
even in the short run
moreover,
because people are
always at their preferred position,
government efforts
to improve their position
will be ineffective

Keynes:
So, who takes
care of
unemployment

Major:
Exactly, who will take care of the old?

Hayek:
No one
that’s the beauty of
the system
The fear of involuntary
or unwanted unemployment
is banished
such unemployment
as is observed is a
voluntary choice
for leisure
this is the meaning
of the
rational expectations revolution
the future can
and will be
anticipated
by the market

Tony Major:
Gentlemen, gentlemen, let’s put the demand supply issue to the side for a moment. Our viewers would like to understand how you did arrive at such different theories? After all, both of you came to the understanding of the working of the economy around the same time, between the two world wars of the twentieth century. Mr Hayek, let’s start with you, share with us the evolution of your theories.

Hayek:
Austria
is where I come from
Austria
is where I was born

I was profoundly
shaken
shaken
to my bones
by the interwar
catastrophe
that struck
my
native Austria
the land where I was born
the land where I come from

Tony Major:
Which catastrophe are you referring to?

Hayek:
Why…. liberal Austria….

Tony Major:
Let me remind you, there is no more W,H,Y

Hayek:
Sorry, sorry
let me start again

how come
liberal Austria
the land where I come from
collapsed and given-away
to fascism
to fascism
to fascism

Tony Major:
How come?

Hayek:
The brief
socialist municipal
experiment in
1918 VIENNA
failed
failed

Tony Major:
And then?

Hayek:
It led to
a reactionary coup
a reactionary coup

Tony Major:
You are talking about 1934?

Hayek:
Yes, yes
four years later
Austria
the land where I was born
fell
to Nazi invasion
and agreed to the
occupation

Tony Major:
Were you there?

Hayek:
No, no
I ran away before
I flew to safer shores
but
I was shaken to the core

Tony Major:
Why? oh, god dammit! How can I conduct an interview without the word…let me try again. Are you trying to say that the socialists in Vienna actually brought on Nazism?

Hayek:
The marxists
the marxists
the left
they tried
to introduce
a state directed planning
municipally owned services
collectivized economic activity
all at once
to
post 1918 Austria
the land where I was born

Tony Major:
And what was wrong with that? After all, following the first world war, help was needed.

Hayek:
The socialists
they not only failed
it led
directly
to a
counter-reaction

the indecision
of
the left
was no match
for the
radical energy
of the right

the marxists
brought
the Nazis
the marxists
brought
the fascists

Tony Major:
Aren’t you taking it a bit too far?

Hayek:
The socialists
had
too much faith
in the logic of history
in the reason of man

The fascists
were
uninterested in both
uninterested in both
so
they were
well placed to step in
and take
Austria
the land where I come from
Austria
The land where I was born

Tony Major:
Mr Hayek, let me see if I understood you correctly. In your view the European tragedy had thus been brought by the shortcomings of the left, in its inability to achieve its objectives and, its failure to withstand the challenge from the right.

Hayek:
History teaches us
that
the only way to
defend liberalism
and
open society
is
to keep
the state
out of
economic life
keep
the state
out of
economic life

we must
face the fact
that
the preservation
of individual freedom
is incompatible
with a full
satisfaction of
our views of
distributive justice

Tony Major:

Mr Keynes, you come from a wealthy family, your parents kept three servants, a cook, a parlor maid and a German governess, Inga. You went to Cambridge and became a member of the Bloomsbury Group. Virginia Woolf and T.S. Eliot were personal friends of yours. Your art collection included Cezanne, Degas, Modigliani and Picasso. Your wife, Lydia Lopokova, was a well-known Russian ballerina. You were born the same year Karl Marx died but you are not exactly the typical workingman’s revolutionary. Still you became the poster child of post-war social democracy. How come?

Keynes:
I was too
born into
an empire
a falling
empire
the British
empire

I grew up
in
a stable
prosperous
Britain

I was
privileged to
observe
the collapse
of
the empire
the
British empire

Tony Major:
Mr Keynes, you are using the word privileged, how come?

Keynes:
I came to see
the essential
unpredictability
of
human affairs
unpredictability
of
human affairs

Uncertainty
rules
our life
uncertainty
rules
our life

Tony Major:
You are talking about the time before and after the Great Depression…

Dictionary Scrutinizer:
Good evening ladies and gentlemen
The good citizens of our global fitness gym
This is the Dictionary Scrutinizer
and tonight we get rid
of the term
Great Depression
There is no, there was no
Great depression
so, put on your running shoes
and jog, jog, jog

Tony Major:
Oh, come on, this is a historical term. all of his theories are based on the understanding of the great…

Dictionary Scrutinizer:
No more, no more
no more, no more
only great
no depression

Tony Major:
Ok, Mr Keynes, are you talking about the time before and after the great hogwash?

Keynes:
Yes, yes
Yes yes
collective fear
took over

When some shock
causes people
to panic
animal behavior
takes over

Tony Major:
We are all just sheeps?

Keynes:
We are all
just sheeps

everyone rushes
to the
entrance or exit

This is when
government comes in
this is when
government comes in
to put a
framework of
rules and conventions
to cope
with uncertain times

Tony Major:
Should government play the shepherd?

Keynes:
Government should
run a budget deficit
government should
run a budget deficit

Tony Major:
How?

Keynes:
It should be
financed by bond issues
and
the government should
directly spend the money raised
on infrastructure projects
increased government spending
increased government spending
is just what the doctor ordered
Government should figure out
how much help
they think the economy needs
then add 50 percent
how much help
they think the economy needs
then add 50 percent

Hayek:
But we saw
what happened
when government
tried to
fix life

Keynes:
But Hayek
the conditions
which brought
about
Nazism
are not
I repeat
are not
permanent

Hayek:
The conditions
will repeat
themselves

Keynes:
Look at Sweden
look at
the success
of social democracy
no Nazis came
out of there
no fascists
took over

Hayek:
One day
they will come
one day
they will come

Keynes:
In postwar Britain
the labour party
brought
stabilization
not fascism

Hayek:
Look at
Austria
my former home
government planning
was all the norm
and look at it now
30% nazism
30% fascism
30% xenophobia
30% paranoia
and
it will grow
it will grow
social democracy
will lead
to fascism

All non-individualist
social thought
any argument that
rests upon
collective categories
will bring back
our past upheavals

Tony Major:
Mr. Hayek, in certain times you were advising the government of Margaret Thatcher in how to deal with the economy. Your friend Milton Friedman was behind Ronald Reagan’s privatization policies. So, it seems to me that back then you thought that government can do something about the economy. Let me show you some archive footage…

(as seen on video)

Margaret Thatcher:
There is no
such thing
as
a society
There is no
such thing
as
a society

There are only
individuals
and
families
There are only
individuals
and
families

Government should
only maintain
the flow of money
and keep
open markets

Leave the
open market
to the
individual choice

Because, after all

there is no
such thing
as
a society
there is no
such thing
as
a society

There are only
individuals
and
families
there are only
individuals
and
families

Tony Major:
And here is another pioneer, a maverick of the free market.

Ronald Reagan:
There’s a new morning
in America
there’s a new morning
in America
Government is no more
the solution
Government is no more
the solution
Government is
the problem
Government is
the problem

So,
cut taxes under
any circumstances
cut taxes for
any excuse
cut taxes for
any reason
cut taxes whenever
it’s possible
and stay out of
the free market
Because
there’s a new morning
in America
there’s a new morning
in America

Tony Major:
So, Mr Hayek, why…sorry…how come we need government to get rid of government?
Hayek:
We need a plan
to resist
all planning

Keynes:
A plan to
resist all planning
might be better
than its opposite
but, my dear friend
it belongs
to the same
style of politics

Hayek:
Democratic planning
is
the slippery road
to
totalitarianism
No-planning
is
the road
to
prosperity
the creative destruction
of
capitalism
will find
it’s way

Keynes:
But what about
quality of life
Take for example
the public investments
in the arts

The good life
isn’t it what
economic growth
is all about

Hayek:
Oh, the arts, the arts
you always bring
the arts
what did the art do
to stop fascism
what did the art do
to stop extremism

All around Europe
art is
subsidized
and look around
right-wings everywhere
xenophobia everywhere
paranoia everywhere
so
don’t give me
the art, the art
the good life

Tony Major:
Take this program, for example, without public money we would not be sitting here talking

Hayek:
So what
look at the BBC
in my old country
it’s the ORF
what are they producing?
Talk shows, reality shows
detective shows, so called news shows
junk, junk, junk
the private sector
could do the same
and cheaper

Tony Major:
But they don’t.

Hayek:
Look at this set
we don’t need it
we just talk
we just talk

This set is
a waste
of public money
of taxes
you and me pay
we don’t need it
we just talk

Dictionary Scrutinizer:
So, let’s get rid of
the set
let’s get rid of the word
SET
let’s get rid of
set design
and scenography
and every other
word that has to do with the word
SET
so,
put on your walking shoes
and stand, stand, stand

(while the set is being removed)

Hayek:
Sell the set
to the third world
Let them have it
for half the price

Tony Major:
How come we are always dumping our garbage on the third world?

Hayek:
It is not garbage
It is a second hand S……..studio
in good condition

Keynes:
But they deserve
a S……something
as advanced
as ours
the third world
always get
the crumbs

Hayek:
One day
they will
One day
they will
The market will
give them
a first rate
S……studio
just like us
just like us

Tony Major:
Great, now we even have to stand. And this is a talk show.

Hayek:
What’s wrong
with standing
It is good
for your heart
The market
takes care
of your health

Tony Major:
Let’s move on while standing…I want to play for you another clip. This time from your old country Mr Hayek. The social democrat Bruno Kreisky, who some describe as the Austro-Keynes.

Bruno Kreisky:
Deficit spending
is the Austrian way
Spend what you’ve got
and a bit more
from the deficit that is left
spend a bit more
and then
spend a bit more

In an economic slump
government should
run deficit
to compensate for
the shortfall in
aggregate demand
In boom times
Government should
run a surplus
so that there
is no deficit
over an
economic cycle
only, only
cyclical deficit

and,
we should do
the same internationally
to overcome the
economic crisis
we need
a political solution
the west
being immensely rich
should help build
the third world
on a continental scale
So, the poor countries
can stand on
their own
We should
spend and spend and spend
till everyone has
minus-plus
the same
standard of living

The money is there
the money is there
It is always there
and
don’t believe anyone
who says it is not
The money is there
and we should spend it
and then
spend a bit more

Tony Major:
Kreisky moved Austria forward, he gave the country a kick it was missing after the war. The welfare state became a success story.

Hayek:
Kreisky was the
new emperor
but he had
no clothes
He took
the credit to himself
and left the mess
to someone else

Kreisky became
the big daddy
of the Austrian kindergarten
everyone ate
from his generous hand
and kept
a low profile
just like in
the monarchy
total dependency

Kreisky left
a crisis
to those who
came after him
the narcissism
of the left
the workers’ unions’
selfishness
created an
economic vacuum
more became less

the welfare state
is a failure
free this
free that
hugh taxation
inhibits growth
high taxation
inhibits efficiency

We have free education
but no one knows
how to read
We have free health care
and everyone is
mentally sick
All around
lazy, lazy, lazy
people
and Kreisky
wanted them
like that

Fat and lazy
and half asleep
dependent on
government handouts

Zombi citizens
of the
welfare state

Tony Major:
Mr Keynes, your response

Keynes:
The social democratic
consensus
might be
boring
and even I would say
paternalistic
but it worked
but it worked
but it worked
and
people knew
that it worked

Sweden worked
Norway worked
Austria worked
Japan worked
even America
after the great….de..
worked

The new deal
worked
the great society
worked

Tony Major:
Mr Hayek, you will have to admit that in many aspects the social democratic consensus signifies the greatest progress which history has seen so far. Never before so many people had so many life changes.

Hayek:
But at what price
But at what price

Hitler’s war
put Germans
back to work
It worked
it worked
but at what price
Mussolini made
Italian trains
run on time
It worked
it worked
but at what price

Keynes:
Attlee, de Gaulle, Roosevelt
they made it work
and for a good price
a good price

Hayek:
Chimerica made it
work for a while
and for a
good price

Tony Major:
Chimerica?

Hayek:
China and America

Tony Major:
What about China and America? And what was the good price?

Hayek:
Chimerica was
like a marriage
made in heaven

East Chimericans
did the saving
West Chimericans
did the spending

The more China
was willing
to lend
the more America
was willing
to borrow

Tony Major:
What is wrong with that picture? You lend, I borrow, business as usual.

Hayek:
The trouble
with Chimerica
is that
the Americans
didn’t invest
East Asian
savings
they
consumed them

Tony Major:
You mean, East Asian investment in Us treasury bills failed. The American took the money but instead of using the cash to create new products/jobs/opportunities, they spent it and were left with an ever-growing debt.

Hayek:
True enough
it enabled
Alan Greenspan
to run an
exceptionally
cheap money policy
in the first
five years
of the new millennium

Tony Major:
Yet, as he acknowledges, cheap money had only a modest effect on recorded developed country investment.

Hayek:
Indeed,
with Asia
growing faster
than the
USA or Europe
the gap between
saving and investment
grew.
The US and Europe
asset boom,
which together with
the explosion
of credit-card debt,
fueled the
consumption boom
and was at best
a short term
answer to
the increasing
gap between
the two.
it was a
race between
whether the
housing bubble
or
the dollar
collapsed first.

Keynes:
The stimulus packages
will restore
the world economy
to its past condition

Hayek:
But it will
do nothing
to solve
the structural imbalance
between
saving and investment.
and this is
China
we’re talking about

Tony Major:
What about China?

Hayek:
Communist regime
government planning
it can only
lead to
disaster

Keynes:
Here we
go again
paranoia, paranoia
socialism, communism
fascism, nazism
for you
governments all over
the world
are just
a ticking time bomb
of destruction

Tony Major:
But after the war, everyone believed in the state, in part because almost everyone feared the implications of a return to the terrors of the recent past, a terror you yourself have had to deal with, and was happy to constrain the freedom of the market in the name of public interest. Just as today after the big economic crisis governments all over the world came to the rescue with…

(cuts him)

Hayek:
Who are you?
Don’t you see that
we are talking
You are disturbing
two great minds

Tony Major:
I’m Tony Major, Tony Major! The man that made this program a hit!

Hayek:
We don’t need you

Keynes:
But who will ask
the questions

Hayek:
We don’t need
to be asked

Keynes:
Someone has
to moderate

Tony Major:
Gentlemen, with all due respect, this is my program. I…

Hayek:
Not any more
We don’t need you

Keynes:
It’s his program

Hayek:
But we outgrew him
let’s save his government
subsidized paycheck
We can do it alone

Tony Major:
Gentlemen…

Dictionary Scrutinizer:
And ladies
tonight we get rid of the word
moderator
and add to that
interviewer, newscaster,
and so on and so on
so, put on your thinking hat
and talk, talk, talk

(Tony Major is carried out of the studio while screaming)

Tony Major:
I’m Tony Major, Hardtalk is my program, my baby, my life work…

Dictionary Scrutinizer:
So,
Sorry, Tony
you’ve been outsourced
you’ve been downsized
you are
to put it simply
unemployed
So, put on your working suit
and find some other job

Tony Major:
This is my…

Hayek:
So, Keynes, finally
it is
you, me and the economy
you, me and the economy

Hayek and Keynes :
You, me and the economy
you, me and the economy
you, me and the economy
you, me and the economy

Keynes:
In today’s
weightless economy
it has become
much harder to establish
a connection
between effort and reward.
We have to distinguish
between
work
the act of
making things
and
activities
such as derivatives trading
which just add zeroes
to balance sheets
without extra effort
work is
non-scalable
activities
are

Hayek:
Your point?

Keynes:
Our economies
are increasingly
dominated
by activities
and therefore
by separating
efforts from rewards
they are far more random
in their results.
Fair prices
depend on
being able to
measure effort
in terms of things produced
rather than money produced
One cannot have
a just society
if the main purpose
of economic activity
is the manufacture of money
One cannot have
a just society
if the main purpose
of economic activity
is the manufacture of money

Hayek:
But we cannot
produce a better
living without…

Keynes:
At the heart of the
moral failure
is the worship of
economic growth
for its own sake
rather than
as a way to
achieve the good life.

Hayek:
The quantity of money
is determined solely
by the supply
of money

Keynes:
No, by the demand
for loans
which depends on variables
outside the monetary model

Hayek:
Restore the money supply
to what it was
before it collapsed
problem solved

Keynes:
Money, I grant is necessary
but not sufficient
spend more money on public works
problem solved

Hayek:
Government should not
manage demand
to limit fluctuations
to the smallest feasible amount

Keynes:
Government should have the role
of uncertainty reduction
Government policy should aim to
make the world more predictable, more Gaussian

Hayek:
But the government
had it wrong
in the last crisis
interest rates were too low

Keynes:
They were too high

Hayek:
The FED had kept
money too cheap
for too long

Keynes:
The speculation in
real estate and stocks
had masked
a more, more, more
general tendency
to underinvest
in relation to
corporate savings

Hayek:
The FED allowed
an unsustainable
credit boom
to build up

Keynes:
Once the market had
c o l l a p s e d
psychological poverty set in
people stopped spendings

Dictionary Scrutinizer:
There is no poverty, no
po, po, po, vert y
it’s psychological growth
gro gro growth

Hayek:
To prevent
booms and busts
one should never allow
any credit injection
from the banking system

Keynes:
But the fall in
private spending
was not offset
by an increase in
public spending

You see
less private spending
more public spending

Hayek:
It is too easy
It is too easy

Every time
a problem occurs
you just say
spend more, spend more
but
price level has to fall
productivity has to increase

The credit boom had led to
overinvestment
it is all policy mistakes
it is all policy mistakes

Keynes:
You might be right
you might be wrong
but
I’m interested not only in
diagnosis
but also in the
cure

Hayek:
We cannot
we cannot
we cannot
spend our way
out of recession

Dictionary Scrutinizer:
Poor choice of words Mr Hayek
there is no recession
no r e c e s s i o n

Hayek:
Yes, yes
we cannot
spend our way
out of…r….
but we can
deregulate the market
lower taxes
push for free trade
privatization
deregulation
balanced budgets
target inflation
float the exchange rates
We can, we can
In short
free markets
would deliver
better results than
fettered ones

Keynes:
So how come
Reagan and Thatcher
produced more
unemployment?
The market did not
correct itself

It is always the same
with the economics
of the Laissez-Faire

Hayek:
The labour union
was pricing itself
out of jobs

Keynes:
It is not the job
of workers
to fix the economy
while, while, while
market people
acquired money
to make more money

Hayek:
If what people
want is money
then that’s what
they should have
we have nothing to say
in that matter
we have nothing to say
in that matter

Keynes:
But Hayek
look what happened
to the market theory

Banks mutated
from utilities
into casinos

We are manufacturing
paper money
paper money

We simply
do not know
luck plays a much
bigger role
in
success or failure

Hayek:
In the long run
my friend
the market always
corrects itself

Keynes:
But this long run
is a misleading
guide to affairs
In the long run
we are all dead

Dictionary Scrutinizer:
Good evening ladies and gentlemen
The good citizens of our global concert hall
This is the Dictionary Scrutinizer
and tonight we get rid of the word
Keynes
and the Keynesian mindset
So Hayek, pick up your
dusty guitar
you are going solo

Hayek:
But he is
the yin
to my yang
Without him
there’s no one
to blame

Dictionary Scrutinizer:
No more Keynes.
John Maynard,
give us your
economic model
we can figure out
the opposite
Go solo, Hayek
don’t worry
about the competition

Keynes:
So long my friend
I will be back
when unbridled capitalism falters
They always call me back
after all
I’m an evolutionist
not a revolutionist

if we don’t
do more to
get the economy
back to speed
It won’t be
because
stimulating demand
won’t work
it will be
because
we’ve chosen
not to do it
if we can’t find the way
it’s because we
don’t have the will

Dictionary Scrutinizer:
Mr Keynes
before you leave
can we hear
one more time
about the good life
the way you
imagine
the good life

Keynes:
The love
of money
is only
only, only, only
justified
if it leads us to
good life

The good life
is not what
makes people
better off
It is what
makes them good

To make the
world
ethically better
is the only
justifiable purpose
of the
economic life

Capitalism is just
a necessary stage
just
a necessary stage
to get societies
from a state of less
to a state of more
After that
capitalism’s job
is over
and its usefulness
would disappear

The empire
of greed
should be
progressively
retracted
as its job
neared completion
beyond
a certain point
Increased wealth
does not make people
happier
so the dream
of bliss
attached to the
accumulation of riches
is just
an illusion
just
a delusion

Dictionary Scrutinizer:
You’ve said enough
Mr Keynes
so long and goodbye

(Keynes exits)

Hayek (alone):
All alone
All alone, all alone
It’s like
what Fukuyama
wrote in
the end of history
the final victory
for
the market theory

Listen
I’m not against
collective compassion
Every one deserves
a break
We are all
entitled to be part of
the elusive state
of the good life
but, first
if money is not
going
to be printed
it has to come
from somewhere
If the government borrows
a Euro from you
that is a Euro
that you don’t spend
or a Euro
that you don’t lend
to a company
to spend on
new investment

Every Euro
must correspond
to one less
Euro of
private spending

Jobs created by
government spending
are offset
by jobs lost
from the decline of
private spending

We can build
roads instead of factories
but
fiscal stimulus
can’t help us
Build more
of both
no individual, no, no, no, no
no government agency, no,no, no, no, no
has a complete overview
nobody, no, no, no, no
no political planning, no, no
could be given, no, no
authority over all our lives, no, no, n0

even you, being here
is a waste of
public subsidies
because
to come here
most of you used
public transportation
what a waste
what a waste
of
tax payer money

You could stay
at home
you don’t need
to see me
I’m not a
super model
I think and write
economic models
you don’t need
to see me live
you don’t

(the live voice is replaced by recorded voice, Hayek exit slowly)

Stay at home
I will come to you
via networks
that some
market people
created
to keep the
economy moving
So, don’t worry
the invisible hand of the market
will make you too
happy and rich
happy and rich
happy and rich

Dictionary Scrutinizer:
Good evening ladies and gentlemen
this is the Dictionary Scrutinizer
tonight we get rid of the word…
let’s get rid of all the
words
let’s get rid of the entire
dictionary
let’s get rid of the whole
vocabulary
words confuse us
words make us think
words cast doubt
words make us hesitate
and pause
before we reach our wallets
words destroy
the eternal
pleasure of shopping
so, let’s ged rid
of all the words
let’s put on our best suit
and buy and buy and buy
no more words
no more wor
no mor
n
la, la, la, la
la, la, la, la

End