classical economics
for analysis,  forecasting
and policy design

Table of Contents

The Fruits of Graft
Great Depressions
Then and Now

By Wayne Jett

Launfal Press, Publisher
Copyright 2011



          Acknowledgements -- xi
          Preface -- xiii

Chapter 1      Pillars of Classical Economics                                          1
Say’s law; rule of diminishing returns (Laffer curve); tax rate and employment trade-off; GDP growth rate vs. tax rate; classical theory in tax policy; classical theory in monetary policy; measuring currency value; stabilizing currency value; analysis and forecasting; diagnosing economic ailments

Chapter 2      Mercantilism                                                                     25

Illicit alliance; zero-sum universes; precious metals, money and commerce; mercantilist tariff policy; the rise of international trade; persistent mercantilism and war; mercantilist theory and policy; “executors” of mercantilism; rise of classical theory and the middle class

Chapter 3      Mercantilism in America 1600-1900                                 45

Colonial elite; Hamilton’s Report on Manufactures; federal credit: success and scandal; Andrew Jackson’s Democratic Party; Whigs and the new Republican Party; the Morrill Tariff Act of 1861; war in America 1861-1865; reconstructing the U. S.; monetary deflation and the “longest contraction;” 1873-1879 in classical context; railroad mercantilism; White on French fiat money; reconstruction mercantilism; post-resumption expansion; banking panic of 1893; 19th Century sunset; monopolist mercantilism; the rise of financial mercantilism; a mercantilist social agenda

Chapter 4      Progress and Poverty                                                        85

Henry George; the law of rent; land, labor and capital; Malthus theory dissected; land rent colossus; land ownership issues; vast and dominant pecuniary interest; poverty’s solution; theory of taxation; George’s grand reception; Henry George and the Roosevelts

Chapter 5      Nearly the Best of Times 1901-1929                                103

U. S. economic leadership; Harding-Coolidge replace Wilson; Coolidge-Mellon fiscal policy; Republican tariff policy; the Coolidge-Mellon record; Coolidge-to-Hoover transition; Hoover on stage; Joe Kennedy’s rise; Kennedy in Hollywood; Wall Street in 1929

Chapter 6      Almost the Worst of Times 1929-1940                             121

Smoot-Hawley and the Great Crash of 1929; malefactors of great wealth; Hoover and Smoot-Hawley; the Revenue Act of 1932; Roosevelt’s tax increases; FDR embargoes gold exports, seizes domestic gold; burying free trade; U.S. purchases foreign gold; devaluation of the dollar; Federal Reserve shrinks bank lending; sterilization of gold; regulatory complexity and the economic wedge; the dark side of the New Deal; amidst poverty, government enrichment; humanity at mercantilism’s table

Chapter 7      The Keynes Mutiny                                                         165

Keynes joins the mercantilists; confronting Keynes; managed domestic interest rates; deficit spending as economic stimulus; “animal spirits” and rational markets; a quiver of errors; complexity exalted; Heckscher on Keynes

Chapter 8      The Worst: Slip-Sliding into War                                    183

“The Great War;” the Treaty of Versailles; Germany’s hyper-inflation; the Dawes and Young Plans; mercantilist nationalism; weakened U. S. pushes allies away; opponents move aggressively; allies no longer; Roosevelt’s mercantilist agenda; U. S. isolation/appeasement; Hitler moves at will; FDR asks assurances; Japan watches Europe, acts in Asia and Pacific; FDR ignores German offers; holding FDR accountable

Chapter 9      Understanding Franklin                                                  201

Franklin’s family heritage; an only child; early influences, Groton and Harvard; social suitability; offers to marry; cousin Eleanor; Columbia Law School and marriage; internship as attorney;
parenting children; becoming a politician; Assistant Secretary of the Navy; the Lucy Mercer affair; gaining political standing; on the ticket in 1920; rainmaking on Wall Street; affliction by polio; Wall Street business and investments; return to the political stage; bringing the “brain trust” to Albany; appraising the “sphinx of Hyde Park”

Chapter 10      New Light on the New Deal                                         229

Small is beautiful; free trade weds mercantilism; rolling Hoover; yachting into office; off the gold standard; a “man-made” depression; the Rockefeller assist; owning government; Roosevelt’s skeptics; goading fear and suffering; the three truths; the myth of unintended consequences; eye to eye; Democratic platform facelift; feeling for the bottom; committed mercantilism; imperial mercantilism; the unclad emperor; nailing a depression

Chapter 11      Debunking Orthodoxy:
                        Making Economics Rational Again                             267

Reconsidering A Monetary History; economic history unveiled; speak no evil, write no evil; loving a good crash; Smoot-Hawley: signal for short sellers; coming out on top; presuming benign influences; Mundell’s great deflation; inflationary, conservative Federal Reserve; deflation issues; Keynesian confusion; 21st Century orthodoxy; classical analysis; gold standard and classical theory exonerated

Chapter 12      American Mercantilism After Roosevelt                      289

Two-party domination by mercantilism; Goldwater defeats Rockefeller; Nixon mercantilism; the Camp David weekend; life after Nixon; fixing Camp David; the dollar floats; Camp David in perspective; Reagan’s economic policy; Bush 41: middle class values and Wall Street; Clinton: Bentsen, Rubin and Summers; Bush 43: giving way to Obama

Chapter 13      Untangling the Monetary Morass                                311

Self-appraisal exposes rifts; Keynesian performance in classical context; Federal Reserve diversionary tactics; ending manipulation of interest rates; shrinking the Fed; rescuing the dollar; persistent central manipulation

Chapter 14      Redistribution Injustice:
                        Four Horsemen of Economic Apocalypse                   331

Capital investment and compounding growth; political redistribution of wealth; redistribution by mercantilist designs (Wall Street captives: the Federal Reserve, the U.S. Treasury, the Securities & Exchange Commission and the Commodities Futures Trading Commission); Madoff and Markopolos

Chapter 15      Third Millennium Mercantilism                                   359

Mercantilism, media and Enron; SEC green-lights naked short selling; hedge funds, prime brokers, conspiracy; SEC corruption and scandal; legal racketeering; SEC repeals “uptick rule;” front-running every trade; buying “entitlements” to securities; academic cover for naked short selling; illicit handoff: naked short to private equity; crude oil, gasoline and politics; crime fighting in financial markets; interest on bank reserves; weapons of mass financial destruction

Chapter 16      Financial Collapse of 2008-2010                                    403

Snow at Treasury; czar Paulson’s regime; liberating fraud; Goldman Sachs and sub-prime loans; New Century blow-up; banks fall to market scam; demolition of Bear Stearns; Fannie Mae and Freddie Mac; Lehman Bros., Merrill Lynch and AIG; SEC shield; some “more equal” than others; bailout billions; Wachovia Bank, Citigroup and Wells Fargo; Morgan Stanley; fake Treasuries; crude oil coup de grace; tasting distrust; automobile industry collapse; integrity in policy and enforcement; financial terrorism; Bush’s shortcoming; uncharted waters; business as usual

Chapter 17      The Elitist Paradigm                                                     457

The plan for global rule; H. G. Wells: elitist shill; Wells and the presidents; defeating the middle class; the paramount mercantilist motive; the broader agenda; indispensable media; making the agenda happen; mercantilism vs. capitalism; private agenda shadows public policy; the European front; searching for law of human progress

Chapter 18      Politics and Reform                                                      489

Social effects of unstable currency; slouching towards the “new republic;” rolling back mercantilist advances; media shield for mercantilism; political alignments; middle class pathfinding; ending financial fraud; federal tax reform; stripping mercantilism out; Connolly’s epiphany; saving the republic

Chapter 19      Powering Market Prosperity                                        527

Stolen American progress; free market locomotion; the acquisitivity model; innovation-production phenom; distinguishing the enemy; the financial isthmus; the road away from mercantilism

Index – 539