Repeating the same but expecting a different result

[aphar]

In 1998 I was attending a Princeton macroeconomics class taught by Prof. Alan Blinder.
He was gracious enough to let me in and answer my many questions after lectures.

One question I asked him was about the Marxist claim that recessions are inevitable under capitalism: after all, observationally, no capitalist economy has lasted much more that 10 years without one. He responded that this is a not a conclusive proof: each and every recession can be explained by a specific action (or inaction!) by the central bank, and, given a Sufficiently Smart central bank, capitalism may exist without recessions.

There is also an observation that every time socialism has been tried, it has been a failure, from utopian communities to USSR, Cuba and Venezuela (note that Scandinavia is not socialist!). Nevertheless, die hard enthusiasts keep preaching it (including a UChicago freshman over a Thanksgiving dinner!)

How do these two positions differ?

Comments

[ymarkov]

In principle they don't. Blinder is a smart man, but he's an unreformed Keynesian, one of those guys who treat the economy as a black box and think that credit and tax policy is all that matters.