Recalculation > Austrian business cycle theory.

Recalculation theory allows for macroeconomic imbalances without the artificial need to blame monetary policy and the central bank. Austrian business cycle theory starts with the premise, "it must be the governments fault", and then works backwards from there.
 

I like Arnold Kling as much as the next guy but that's a really really bad idea.
 

David said,

"Recalculation theory allows for macroeconomic imbalances without the artificial need to blame monetary policy and the central bank."

Yeah, citing the predominant source of instability and distortions in economy to something that represents one half of every exchange in the market system is totally nonsensical. So let's look to blame it on imbalances in certain statistical aggregates originating from some nebulous change in the population's "animal spirits", or some such.

I hope for this to not be offensive, but doubtless it will come off that way. David, it really appears that you do not fully understand the Monetary Theory of the Trade Cycle. Almost all economic calculation is done in money terms. It's amazing that you do not think that an institution tasked with centrally planning the provision of money could make any large and systimatic errors.
 

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I don't see how it could be a bad idea to have outreach to anyone who will listen. Local Tea Parties have co-sponsored a handful of my events, and at the end they've told me, delightedly, that I'd given them information they'd never heard before. Here I was thinking this was a good thing.
 

I like Kling, but my thinking is that he's weak on central banking. The reason I say this is in commentary I've seen, he seems to go out of his way not to blame the Fed.

Kling's Recalculation thesis is a great one, save for one thing, it leaves out the effect of central bank interventions. I think it doesn't make sense to forget the role of monetary policy in this current bust because it certainly had a major role.

Still, I would agree that, although a major piece, ABCT by itself doesn't explain all of the collapse. With that said, why not try to join Kling's Recalculation thesis with ABCT? I think together, they could explain the collapse pretty well.

As for the teaparty people, I am not sure they'd be that open minded. They used to be a purely Ron Paul phenomenon, but a few got taken over by neo-con influences. The Paulites would certainly welcome any good econ, but the neo-cons in the crowd subscribe to all sorts of fallacies like nationalistic protectionism, subsidies, etc. Taking econ to the people is a good idea though. Based on the past 15 years, I think it's safe to say that anybody going after the cognoscenti has, in my opinion, failed. So it would make sense to talk to Joe Sixpack, talk to the people on the ground.

Jason
 

I am heavily involved with my local tea party, and also getting more and more into the deeper Austrian economics (to the point where no one around me knows what I am talking about when I start lecturing about economics)and I think it is a good thing to connect with the tea parties, and try to bring them more knowledge than merely, "free markets are better than socialism" or whatever they might say. Information empowers, and the more in-depth knowledge tea parties gain, the stronger they will be. Mr. Murphy, I just found your blog, I think a link from the Mises Institute, and I am putting on my "read everyday" list of websites, up there with Lew Rockwell, the Mises Institute and Campaign for Liberty. Thanks for keeping up a blog, I am enjoying it immensely.