Mervyn King, the former Bank of England governor who served under three British prime ministers, chose Niccolo Machiavelli’s “The Prince” as his favorite book and said it offers lessons for today’s rulers.
President Barack Obama has shown a determination to redistribute wealth by increasing government spending, despite unsustainable deficits. We shouldn’t be surprised if Janet Yellen, the president’s nominee to be Federal Reserve chairman, shares his objective.
By the early 1940s, the Keynesian Revolution in America was in full swing. Fast-moving events in Germany obliged Franklin D. Roosevelt to spend on the vast scale that John Maynard Keynes prescribed. Despite the president’s assurances during the 1940 presidential campaign -- “I have said this before, but I shall say it again and again and again: Your boys are not going to be sent into foreign wars” -- he ordered a gargantuan rearmament program. In 1940, the annual defense expenditure was $2.2 billion; the following year it reached a sizzling $13.7 billion.