What if Rothbard had been against Newton's politics?

Murray Rothbard was a very bright man. But he was also a "true believing" ideologue, and as such, what ever he could use to bash his ideological opponents over the head was A-OK by him. And thus his argument against the Keynesian multiplier, which has created a little kerfuffle in the blogosphere of late.

Let us imagine that, for some reason, Rothbard had hated Isaac Newton as much as he hated Keynes. Here is what he would've done with Newton's second law of motion, with every bit as much intellectual validity as his "argument" against Keynes.

From this point on, until you see the second line of asterisks, I speak as pseudo-Rothbard:


Let us recall that those stupid Newtonian's hold that force equals mass times acceleration or:

F = ma

Which means that:

F / m = a

Now let us look at a similar equation:

F = ma

Where "a" represents "age". By a move exactly like those silly Newtonian's use, we can now see that:

F / a = m

This would mean that the older one gets, the less one weighs! Good God, Newton was an idiot.


What Rothbard's "demonstration" showed was that not every single thing that can be put in a ratio has empirical significance. Wow, what a surprising finding!

And here is what is really weird about this whole matter: the idea of a multiplier is, at its root, a strongly pro-market idea. If you've taken Macro I, you will know that the multiplier applies to private investment every bit as much as it does to government expenditure. Basically, it says that if you start a business, the positive effects will not be limited to your own profits, but will multiply throughout the economy: the people you employ in your business will spend their wages, and that spending will spur on other businesses as well, and so on. Really the only "Keynesian" part of this is that there might be situations in which private investors are reluctant to invest, and in those special circumstances Keynesians recommend that the government step in to fill the gap. Now, that may be a good idea, or it may be a bad idea (perhaps due to crowding out and malinvestment issues), but is not an obviously stupid idea. One thing for sure: the idea of the multiplier is far less stupid than Rothbard's argument against it.


  1. 'What Rothbard's "demonstration" showed was that not every single thing that can be put in a ratio has empirical significance.'

    Isn't that exactly Rothbard's point ? He disputes the empirical significance of the Keynesian multiplier that is supposed to show a direct link between G and C and sees it just as arbitrary as his made-up model.

  2. "Isn't that exactly Rothbard's point ?"

    Well, yes rob, that is exactly Rothbard's point, and a stupid point it is indeed, since no Keynesian ever has contended that all ratios whatsoever can be flipped over to get a "multiplier." In fact, Keynesians have a STORY as to why their multiplier might hold. That Story might be wrong or right, but it is not the idiocy Rothbard depicts it as.


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