What Should Macroeconomics Do?

This is one topic that is way over my head and I took Economics in College, If someone could explain it to me in plain everyday English please leave a detailed comment. I would be so appreciative.

What is wrong with American macroeconomics? In a nutshell, when  2007-9 came along every single macro textbook (including mine) and every  single macro course (save possibly Perry Mehrling's) was of little or  no use in helping people who had read or taken them to read publications  like the FT as they chronicled the downturn or understand the policy  debates hosted by the FT.

At the very minimum, a macro course should teach people enough about  the macroeconomy that they can then read the reporting of the FT. And it  should teach people enough about the theoretical approaches that  underpin policy advocacy that they can then understand and evaluate the  policies proposed in contributions to the FT.

What would such a macroeconomics course look like?

It would, I think, teach the five still-live theories of the causes of economic downturns that underpin people's analyses:

• The theory that high unemployment is produced by real wages stuck  at too high a level for a full-employment economy to sustain. It must  be suffered.
• The theory that high unemployment today is the unavoidable consequence of past overinvestment. It must be suffered
• The monetarist theory that a downturn is the result of a shortage  of liquid cash money which induces people desperate to build up their  cash balances to try to switch their spending away from  currently-produced goods and services. It is fixed by expanding the  money supply or increasing velocity and so reducing money demand
• The Keynesian--or is it Wicksellian?--or is it a  Hicksian?--theory that a downturn is the result of a shortage of bonds,  of vehicles that savings can use to transfer purchasing power into the  future which induces people desperate to build up their assets to try to  switch their spending away from currently-produced goods and services.  It is fixed by expanding the supply of bonds or reducing savings
• The Minskyite theory that a downturn is the result of an  overspeculation-caused panic that generates a shortage of safe  high-quality assets, of vehicles that people to park their wealth and be  sure it will not melt away while their backs are turned,  which induces  people desperate to build up their safe asset holdings to try to switch  their spending away from currently-produced goods and services. It is  fixed by expanding the supply of safe assets or restoring confidence and  so diminishing the demand for safety

All five of these theories need to be taught sympathetically, yet  critically. They all make claims about how the world works that might be  true--indeed, there are surely times and places when and where they are  true--and that can and should be evaluated.

All five of these theories are best taught sympathetically by being  taught historically: as long traditions of thought that smart people  have used to try to understand a changing and confused world. Thus  Minskyism from its nineteenth century roots with Walter Bagehot or  perhaps Adam Smith grappling with nineteenth-century financial crises,  Keynesianism from its roots in Knut Wicksell's studies of disturbances  to the flow-of-funds, monetarism from its roots in John Stuart Mill  trying to understand the first industrial downturn in England in 1825,  overinvestment theories from their roots in Karl Marx grappling with the  crisis of 1848, high-real-wage from its roots in Nassau Senior's  examinations of technological unemployment in the pre-1850 Midlands--all  tussling with a set of problems first raised by Jean-Baptiste Say and  Thomas Robert Malthus.

That would be a macro course that would turn out graduates who could  read the FT--and who would be of great value to all the employers who  need people to process information from the FT.

These three pieces I found referenced and I thought they might peak some interest to readers

 Progress and Poverty by Henry George 1839 - 1897

Part of the Introduction

To Those Who,

Seeing the Vice and Misery That Spring From

The Unequal Distribution

Of Wealth and Privilege,

Feel the Possibility of a Higher Social State

And Would Strive For Its Attainment

San Francisco, March, 1879

Make for thyself a definition or description of the thing which is  presented to thee, so as to see distinctly what kind of a thing it is,  in its substance, in its nudity, in its complete entirety, and tell  thyself its proper name, and the names of the things of which it has  been compounded, and into which it will be resolved. For nothing is so  productive of elevation of mind as to be able to examine methodically  and truly every object which is presented to thee in life, and always to  look at things so as to see at the same time what kind of universe this  is, and what kind of use everything performs in it, and what value  everything has with reference to the whole, and what with reference to  man, who is a citizen of the highest city, of which all other cities are  like families; what each thing is, and of what it is composed, and how  long it is the nature of this thing to endure.

Marcus Aurelius Antoninus


 Progress and Poverty Updated by Bob Drake    


Part of the Introduction


WE OWE Bob Drake a debt of gratitude for this meticulous condensation and modernization of Henry George's great work. The original version had an elegance that evoked a passion for social justice among millions of readers in the nineteenth and early twentieth centuries. However, by the beginning of the twenty-first century, George's complex prose stood in the way of that intention for large numbers of people. Now his ideas can once again be widely accessible


 The Corruption of Economics Neo-classical Economics as a Strategem against Henry George 

by Mason Gaffney

Part of the Introduction

Neoclassical economics is the idiom of most economic discourse today. It is the paradigm that bends the twigs of young minds. Then it confines the fluorescence of older ones, like chicken-wire shaping a topiary. It took form about a hundred years ago, when Henry George and his reform proposals were a clear and present political danger and challenge to the landed and intellectual establishments of the world. Few people realize to what a degree the founders of Neoclassical economics changed the discipline for the express purpose of deflecting George, discomfiting his followers, and frustrating future students seeking to follow his arguments. The stratagem was semantic: to destroy the very words in which he expressed himself. Simon Patten expounded it succinctly. "Nothing pleases a ... single taxer better than ... to use the well-known economic theories ... [therefore] economic doctrine must be recast" (Patten 1908, p.219; Collier, 1979, p.270).