George H. Blackford, Ph.D.

 Economist at Large

 Email: george(at)


It ain't what you don't know that gets you into trouble.

It’s what you know for sure that just ain't so.
Attributed to Mark Twain (among others)



Economic Papers
Political Essays


Economic Papers

Notes on Herd Immunity and
Coronavirus Statistics
Excess Deaths from the Coronavirus


Preface and Prologue to the Third EDITION of The Theory of Interest: Robertson versus Keynes and The Long-Period Problem of Saving and Debt provides a definitive explanation of the way in which the rate of interest is determined and explains the connection between the central thesis of Keynes’ General Theory and the economic problems we face today, 

Causality in Keynes’ General Theory PDF (2019)  It is demonstrated that by adopting Marshall’s ceteris paribus, partial-equilibrium methodology Keynes was able to isolate those factors that, in themselves, determine the value of each variable in his analysis at each point in time and that this made it possible for Keynes to provide a logically consistent, causal analysis of dynamic behavior.  It is argued that this required the rejection of the classical saving-investment/loanable-funds theory of interest in favor of Keynes’ liquidity preference theory and that to reject Keynes’ theory is to reject any possibility of providing a logically consistent, causal analysis of dynamic behavior in economics.

Mr. Keynes and the NeoClassics: A Reinterpretation. PDF (2019) The mathematical structure of Keynes’ aggregate model is outlined, and it is demonstrated that while the Marshallian roots of Keynes’s methodology made a causal analysis of dynamic behavior possible within the analytic framework developed by Keynes throughout The General Theory the Walrasian roots of neoclassical methodology only allows for a description of dynamic behavior without explanation other than through the invocation of a Walrasian auctioneer 

Keynes on Economic Stagnation and Debt PDF (2019) The purpose of this paper is to explain how the failure of neoclassical economics to embrace Keynes’ arguments with regard to the long-run tendency of the system to trend toward stagnation and to ignore the problems endemic in the economics of debt facilitated the adoption of economic policies in the United States that contributed to the economic, political, and social problems we face today.

Robertson Keynes and The Short-Period Problem of Saving PDF (2019)  It is demonstrated that the only way to make sense out of Robertson’s dynamic explanation of an increase in saving within the context of Keynes’ general theory is to assume unit-elastic expectations with an instantaneous adjustment in the value of output produced.  It is argued that while Robertson appeared to be aware of the issue with regard to the effects of an increase in saving on expectations, prospective yields, and the demand for investment goods in his 1940 Essays he ignored these effects in his 1957 Lectures just as they have been ignored by economic policy makers over the past seventy or eighty years.

A Stock-Flow Model of Keynes’ Theory of Interest PDF (2019)  A formal model of Keynes’ theory of interest that draws a clear distinction between stocks and flows is specified in this paper.  This model is used to clarify the confusion that exists within the discipline of economics with regard to the issues that separated Robertson’s Loanable-Funds and Keynes’ Liquidity-Preference theories of interest.  Robertson’s misconceptions with regard to the nature of Keynes’ theory of interest, and by extension those of Harry Johnson, Axel Leijonhufvud, George Horwich, Meir Kohn, Sho-Chieh Tsiang and others who have defended Robertson’s arguments, are explained within the context of this model.

A Note on Robertson and Tsiang versus Keynes PDF (2019) This paper demonstrates that Tsiang does not reconcile the Robertson/Keynes controversy in Robertson’s favor in that Tsiang was confused in his understanding of Keynes.  It also demonstrates that both the liquidity preference and loanable funds theories as embodied in Tsiang’s model assume that the rate of interest is a purely monetary phenomenon, determined solely by the supply and demand for the stock of money, not the flow of loanable funds. 

A Guide to Thomas Piketty’s Capital in the Twenty-first Century (a work in progress) explains the theoretical framework developed by Piketty throughout his Capital in the Twenty-first Century in order to clarify the confusion that has arisen with regard to this framework. It is hoped that, in so doing, it may help younger economists and other social scientists to better understand the elegant simplicity, power, and efficacy of Piketty’s arguments.

Where Did All the Money Go? How Lower Taxes, Less Government, and Deregulation Redistribute Income and Create Economic Instability (2014) is an book that is available in html format below without charge and in a Kindle and paperback format at for a nominal  contribution to this website. It examines the way in which the resurrection of the failed nineteenth century ideology of Free-Market Capitalism led to the Crash of 2008 through the adoption of economic policies that increased the concentration of income at the top thereby creating a situation in which, in the absence of government intervention, the full utilization of our economic resources can only be achieved in the midst of the kinds of speculative bubbles that lead to the Crash of 2008 and the economic stagnation that followed.  (Download the FREE Kindle eBook Reader for PCs, Cell Phones, or Tablets.)

Prologue summarized the basic thesis of this book with regard to the fundamental economic problem we face today.

Ch. 1: Income, Fraud, Instability, and Efficiency examines how the changes in economic policy since 1970 have contributed to the economic problems we have experience over the past forty years.

Ch. 2: International Finance and Trade examines the ways in which deregulating international financial markets has affected the U. S. economy since 1970.

Ch. 3: Mass Production, Income, Exports, and Debt examines the relationship between mass-production technology, the concentrations of income, and the accumulation of debt and explains why an increase in the concentration of income requires an increase in debt relative to income in order to sustain mass-production technology.

Ch. 4: Going Into Debt explains the nature of financial intermediation and the way in which we blundered our way into the Great Depression.

Ch. 5: Nineteenth Century Financial Crises examines the problems of nineteenth century banking, and explains how a banking system works.

Ch. 6: The Federal Reserve and Financial Regulation explains the way in which the Federal Reserve controls the amount of currency available to the economy and why the experiences of the 1920s and 1930s led to a rejection of the failed nineteenth century ideology of Free-Market Capitalism in favor of a pragmatic regime of regulated-market capitalism.

Ch. 7: Rise of the Shadow Banking System examines the way in which the shadow banking system evolved as a result of the deregulation that began in the 1970s.

Ch. 8: Mortgages, Derivatives, and Leverage examines the way in which income streams are securitized, the nature of financial derivatives, and the way in which financial derivatives increase leverage and, hence, in the absence of an exchange or clearinghouse, increase instability in the financial system.

Ch. 9: LTCM and the Panic of 1998 chronicles the events that occurred during the Panic of 1998 when a single hedge fund, Long-term Capital Management, posed a threat to the financial stability of the entire world.

Ch. 10: The Crash of 2008 chronicles the events that occurred leading up to and during the Crash of 2008 and examines the ways in which the policy changes that have occurred since 1970 led to this crash.

Ch. 11: Lessons from the Great Depression discusses the lessons we should have learned from the Great Depression.

Ch. 12: Less Government, Lower Taxes, and Deregulation discusses the relationship between Conservative ideology and economic prosperity over the past one hundred years and summarizes the arguments in Where Did All The Money Go?

Summary and Conclusion summarizes the arguments in Where Did All The Money Go? and outlines some of the economic, political, and social  implications of these arguments.

On the Pseudo-Scientific Nature of Friedman’s as if Methodology (2016) examines the fallacious nature of Friedman's as if methodology that assumes a theory cannot be tested by the realism of its assumptions and attempts to show the extent to which the acceptance of this methodology has corrupted the discipline of economics. 

Understanding The Federal Budget (2014) is an eBook that is available in html format below without charge and in a Kindle format at for a nominal contribution to this website. The purpose of this eBook is to explain the actual, real-world choices faced by the American people in dealing with the federal budget.  (Download the FREE Kindle eBook Reader for PCs, Phones, or Tablets.)

Prologue summarizes the purpose of this eBook which is to explain the federal budget and to dispel the many myths propagated with regard to this budget.

Ch. 1: History of the National Debt explains the relationship between federal expenditures, revenues, deficits, and the national debt and examines the history of the national debt from 1916 to the present is then examined in detail.

Ch. 2: History of the Federal Budget gives the history of the major expenditure and revenue categories of the federal budget from 1940 through 2013.

Ch. 3: Human Resources and Social Insurance examines the history of the federal budget, and all of the major expenditure and revenue components of the budget are plotted from 1940 through 2013.

Ch. 4: Welfare, Tax Expenditures, and Redistribution examines the way in which welfare, entitlements, and tax-expenditure entitlements redistribute income within society.

Ch. 5: Summary and Conclusion examines the feasible ways that are available to solve our fiscal problems and the folly of trying to solve these problems by eliminating waste, fraud, and abuse.   

Links to Sources of Data gives links to the various sources of official statistics discussed in this eBook. 

Graphs provides the graphs from Understanding The Federal Budget on a single webpage.

Waste, Fraud, and Abuse in the Federal Budget (2013) examines the problem of trying to cut the budget through the elimination of waste, fraud, and abuse.  

How a Conservative Would Balance the Federal Budget (2013) examines a truly remarkable article, written by a conservative economist, Jeffery Dorfman, and published in Forbes Magazine on October 3, 2013. In this article, Dorfman looks at the actual numbers in the federal budget and explains in a straightforward way exactly how he believes the federal budget could be balanced. In so doing he has provided a format in which is possible to cut through the propaganda and hype and examine the actual choices with which we are faced today. The actual choices made clear in Dorfman's article are examined in detail in this paper. (This note is an extension of an earlier comment I made on Dorfman's article. The original comment can be obtained by clicking on this link.)

A Note on Managing the Federal Budget (2014) provides a brief explanation of the way in which the federal budget should be managed.

OMB Budget Tables 3.1, 3.2, and 11.3 provides the federal functional budget outlays outlays for 2015 in absolute amounts and as a percent of total federal outlays and GDP.

Budget Projections, Federal Debt, Social Security, and Medicare (2014) shows how the CBO's budget projections provide a broad framework within which to understand our fiscal problems, and that within this framework we are driven to two inescapable conclusions: The first is that it is going to be impossible to maintain Social Security and Medicare without dramatic cuts in the benefits of these programs in the future unless we increase taxes. The second is that even if we do raise taxes it is going to be impossible to maintain the benefits of Medicare if we don't find a way to control the rising cost of healthcare in the private sector of the economy. The spreadsheets that are used to make the calculations can be downloaded by clicking on this link, and the simulation model that is used in this note is explained in Simulating the CBO’s Budget Projection Scenarios.

Simulating the CBO’s Budget Projection Scenarios (2014) explains the simulation model that is used in Budget Projections, Federal Debt, Social Security, and Medicare.

Social Security, Healthcare, and Taxes (2014) examines the history of the Social Security System since 1980 and the issues confronting Social Security today. It provides an in depth examination of the issues raised by the Moment of Truth report written by Alan Simpson and Erskine Bowles. The recommendation in this report are examined in detail and the way in which they affect Social Security are explained.

The Simpson-Bowles Solution to the Deficit Problem (2010) examines the bipartisan Moment of Truth report written by Alan Simpson and Erskine Bowles. This report puts forth a set of recommendations that purport to deal with the federal deficit and debt problems in a comprehensive way. The implications of the recommendations regarding Social Security, Medicare, and revisions of the tax code are explained.

A Note on Taxing Corporations (2011) examines some of the arguments against taxing corporations and explains why they should be taxed.

Government Employment Trends and Statistics (2013) gives a breakdown of federal, state, and local government employees from 1962 through 2011.

Penney Wise and Pound Foolish (2013) provides brief discussion of the important of numbers and keeping numbers in perspective in understanding the economic system.

On Having Our Cake and Eating it too (2013) examines the conflict faced by the American people in attempting to solve the federal deficit problem.

On the Economics of Nuclear Power (2013) explains the problems that must be overcome in order to produce nuclear power in a safe and cost effective manner.

On the Sophistry of Frederick C. Thayer (2015) examines Thayer's mythological notion that the "consistent pattern of balance the budget-reduce the national debt have a big depression is anything other than a set of coincidences."

Pollution, Natural Resources, and Ideology (2011) explains why government intervention is necessary to deal with the problems of pollution and managing our nonrenewable natural resources.

The Keynesian World War II Myth examines the belief that the expenditure policies of World War II validated the Keynesian notion mass unemployment had a simple cause, inadequate demand, and an easy solution, expansionary fiscal policy.

Appendix on International Exchange (2014) is the Appendix on International Trade from Where Did All The Money Go?

Wealth Transfers and the Crash of 2008 (2008) explains the mechanisms by which the housing bubble bursting transferred wealth among people following the Crash of 2008.

On Measuring Aggregate Variables (2010) elaborates on of some of the more technical aspects of measuring total output and the average price level. It also examines the relationship between changes in GDP, productivity, and employment.

The CDS Market and Market Efficiency (2010) examines the rational for the CDS market and finds it wanting. This is not a very reader friendly paper in that it deals with some rather technical economic issues.

Then and Now: 1929-2008 (2014) paper read at the The Third Boston Symposium on Economics sponsored by the Northeastern University Economics club.

A Primer on Economic Crises (2008/2009) chronicles the events that led to the 2008 financial crash as they were revealed in the congressional hearings in the fall of 2008, explains the economic forces that brought about this crash, and how the crisis created by this crash is contributing to the recession that followed. Particular attention is paid to vocabulary with links to the definitions of esoteric terms and acronyms that appear in the news and to detailed explanations of the fundamental economic principles that determine the course of financial crises and economic recessions. The effectiveness of the various proposals that have been offered to deal with this crisis, the kinds of wealth transfers implicit in each of these proposals, and the kinds of things the government should be doing to cope with this crisis are examined. This paper consists of a four part series the individual parts of which are:

Part I: Origins of the Crash explains the fundamental causes of the financial crisis that were brought out during the Congressional hearings in the fall of 2008.

Part II: The Nature of Financial Institutions explains the nature of financial institutions and why their existence depend crucially on the confidence people have in them.

Part III: Bailing Out the Financial System evaluates the various proposals for bailing out the financial system.

Part IV: The Challenge Ahead evaluates the options available to deal with the ensuing economic recession that is the inevitable consequence of the financial crisis.

Liquidity-Preference/Loanable-Funds and The Long-Period Problem of Saving (2016) re-examines the central issue of the liquidity-preference/loanable-funds controversy in an attempt to provide a definitive explanation of the way in which the rate of interest is determined and to explain why the failure to understand understand the central issue of this controversy led mainstream economists to recommend economic policies over the past forty years that culminated in the Crash of 2008 and brought about the economic stagnation we are in the midst of today.

Income, Debt, and Keynes’ Long-period Problem of Saving (2016) provides a synopsis of the arguments and analysis presented in Where Did All The Money Go?, Liquidity-Preference/Loanable-Funds and The Long-Period Problem of Saving, and A Note on Keynes’ General Theory of Employment, Interest, Money, and Prices as these arguments relate to the economic stagnation we see today.

Annotated Bibliography provides an alphabetical listing of books by author. I give a very short, one or two sentence summary of each book, and the title of each book is linked, whenever possible, to reviews by readers that are published by These reviews will give you some idea of what others think. The author's name is generally linked to an online biography of the author.

Bibliography lists books and videos of the congressional hearings referred to in the papers on this website and is broken down into various categories. Most of the videos are stored in C-SPAN's archive and can be viewed on your computer by clicking on the corresponding link. Links to other online videos that are relevant are also provided.

Where The Factories Used To Be shows how the failure to regulate international capital flows have affected Flint Michigan.

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