T and A Man, both Keynesians and monetarists make the same fundamental error of viewing the economy as a set of aggregates that can be tweaked by policy makers to achieve a desired outcome, with the real difference being Keynesians preferring to work from the fiscal side and monetarists the monetary side. Underlying that Friedmanite moneterist prescription are very Keynesian ideas. From where I sit, there isn't much between them in terms of the real world effects of their policies. 'True' Keynesianism is always going to break down because of the reasons I mentioned before - namely that what stimulus giveth, it must also taketh away. A faulty structure of production can't be kept alive artificially without problems.
It is ironic, given his staunch free market, small government positions on just about everything else, that Friedman would be so terrible on monetary policy. He died in 2006, right as the bubble his polices helped to create was about to pop. If he hung on another 5 years I suspect he may have changed his views a bit.
As for some of your history, I don't know where you get that 1971 was the end of Keynes. He fought to rid the global monetary system of gold, which he only partially did with Bretton Woods in 1945. 1971 was the cementing of that aim, not the dismantling. What the end of gold did was expose the Keynesian endgame - rapid inflation and rising interest rates - while making a mockery of the Philips Curve during the rest of the 70s. That's what did Keyesianism in. Then Volcker jacked interest rates to 20% to save the dollar, and the monetarists took over and all of a sudden central bankers became famous where they once were in the shadows.
Monetarists hold the same slavish devotion to aggregate demand that the Keynesians do, they just think that they can print their way to serving the aggregate demand master as opposed to taxing and borrowing. It's two different sides to the same coin, and I disagree with the whole coin. With polices such as QE and other explicit asset purchases by central banks, the sides are slowly fusing together, which is partly why I made no distinction in my arguments.
It is ironic, given his staunch free market, small government positions on just about everything else, that Friedman would be so terrible on monetary policy. He died in 2006, right as the bubble his polices helped to create was about to pop. If he hung on another 5 years I suspect he may have changed his views a bit.
As for some of your history, I don't know where you get that 1971 was the end of Keynes. He fought to rid the global monetary system of gold, which he only partially did with Bretton Woods in 1945. 1971 was the cementing of that aim, not the dismantling. What the end of gold did was expose the Keynesian endgame - rapid inflation and rising interest rates - while making a mockery of the Philips Curve during the rest of the 70s. That's what did Keyesianism in. Then Volcker jacked interest rates to 20% to save the dollar, and the monetarists took over and all of a sudden central bankers became famous where they once were in the shadows.
Monetarists hold the same slavish devotion to aggregate demand that the Keynesians do, they just think that they can print their way to serving the aggregate demand master as opposed to taxing and borrowing. It's two different sides to the same coin, and I disagree with the whole coin. With polices such as QE and other explicit asset purchases by central banks, the sides are slowly fusing together, which is partly why I made no distinction in my arguments.