NYTs Book Blog: "My advice: buy Galbraith."

The Return of John Kenneth Galbraith
By Barry Gewen
Papercuts, December 17, 2008

When Milton Friedman’s stock is high, John Kenneth Galbraith’s is low, and vice versa. These past few months, as the federal government has injected billions of dollars into the economy, with many billions more to come, Friedman’s free-market ideas have taken a beating. My advice: buy Galbraith.

The downfall of Friedmanism, I would say, came on the day Henry Paulson and Ben Bernanke marched into the Oval Office and convinced President Bush that the financial crisis was so severe the government had no choice but to intervene, and in a massive way. Markets could not be allowed to clear, Friedman-style, without bringing the roof down on everyone’s head. And once the Republican party’s Wall Street establishment came on board, almost the only Friedmanites left — at least until the failure of the auto industry bailout — were rural outliers like Sen. Jim Bunning of Kentucky, crying in the wilderness about “socialism.” (There were, of course, other critics of the Bush bailouts, but they were populists, not Friedmanites, distressed that all that taxpayer money was going to the top, not the middle and bottom. That’s a different story.)

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