'The Austerity Trap'

[EdwardBaiamonte]

The Depression was well underway before FDR took office.

the point is that he prolonged it for 10 years that led to World War, when it could have all been over in a year with capitalistic policies.

If Obama keeps U6 unemployment at 14% for the remainder of his term will he become a great liberal hero too??

 

[Rshermr]

The Depression was well underway before FDR took office.

the point is that he prolonged it for 10 years that led to World War, when it could have all been over in a year with capitalistic policies.

If Obama keeps U6 unemployment at 14% for the remainder of his term will he become a great liberal hero too??

And ed proves the point that intelligent con is an oxymoron.

 

[Blooper]

The opposite of austerity is just as bad when governments don't follow the rules keyes himself set up. The idea of excess government spending during periods of economic recession was orginally paired with said government paying off the debt it aquired during periods of economic recovery/expansion.

When we perform deficit spending now, we ignore the 2nd part. So when the economy recovers and government revenue increases, the people in power, instead of paying down the debt, use the revenue for all sorts of new spending, much of it becoming permanent, so when the next recession cycle hits, we increase spending again to deficit level, but now at a higher overall amount, and the debt does not get repaid.

Yes, but that's not exactly the most sound argument for austerity. This issue, at its core, is pretty simple; flow through both stages as they occur, and hopefully you'll get the opportunity to. Even if the government fails to pay off debts during an expansion, it still needs to work its way to the next one.

 

[Blooper]

A loaf of bread cost approx $3.00, depending. How long will it take, at a 4% rate of inflation, for it to cost $1mil?

About 325 years.

And in 10 years it will cost nearly 50% more than it does today. A great many people have not seen any increase in their incomes over the past decade...so trivializing the impact of inflation is both ignorant and cruel.

Not to take away from what amounted to a fairly strong argument - wages often not keeping up with inflation, while prices do, savings being eaten away, and all that stuff -, but inflation isn't the only reason for that fact.

 

[Oddball]

1920's depression took 18 months to end VS FDR dying and many of his distrctive policies being repealed before it ended.

I'd suggest you read some real history for a change. Below is a timeline, and if you not a closed minded wingnut puppet, a few book are also noted.

Timeline of the Great Depression

[ame=http://www.amazon.com/Great-Depression-New-Deal-Introductions/dp/0195326342/ref=sr_1_8?ie=UTF8&qid=1230302046&sr=1-8]Amazon.com: The Great Depression and the New Deal: A Very Short Introduction (9780195326345): Eric Rauchway: Books[/ame]

[ame=http://www.amazon.com/Great-Crash-1929-Kenneth-Galbraith/dp/0547248164/ref=sr_1_1?s=books&ie=UTF8]The Great Crash 1929: John Kenneth Galbraith: 9780547248165: Amazon.com: Books[/ame]


Interesting for today: The Great Depression Analogy by Harold James - Project Syndicate


"What is called sound economics is very often what mirrors the needs of the respectably affluent." J. K. Galbraith


http://www.usmessageboard.com/economy/298635-two-failures-keynes-and-obama.html#post7387938

Galbraith was a political hack, who was the 1950's equivalent to Malthus.....And equally shitty at predicting future events.

Little wonder you light candles for him at your shrine to communistic central planning.

 

[Oddball]

Just as the GOP is attempting to characterize the crash of 2008 as something President Obama created, they have also attempted to rewrite history to state that President Roosevelt created the First Great Republican Depression.

The first Great Depression was over in a few months, due to Coolidge's hands-off policy....After which, the 20s roared.

Hoover was a progressive central planner....FDR doubled down on his foolhardiness and created America's first double-dip depression.

 

[oldfart]

Just as the GOP is attempting to characterize the crash of 2008 as something President Obama created, they have also attempted to rewrite history to state that President Roosevelt created the First Great Republican Depression.

We must be kind to our temporally challenged brothers and sisters!

 

[oldfart]

1920's depression took 18 months to end VS FDR dying and many of his distrctive policies being repealed before it ended.

I'd suggest you read some real history for a change. Below is a timeline, and if you not a closed minded wingnut puppet, a few book are also noted.

I thought he was referring to the Depression of 1920.

 

[Kimura]

Just as the GOP is attempting to characterize the crash of 2008 as something President Obama created, they have also attempted to rewrite history to state that President Roosevelt created the First Great Republican Depression.

The first Great Depression was over in a few months, due to Coolidge's hands-off policy....After which, the 20s roared.

Hoover was a progressive central planner....FDR doubled down on his foolhardiness and created America's first double-dip depression.

That's a seriously revisionist interpretation of history.

All of that spending during the New Deal, such as manufacturing, war production, employer of last resort, etc. created real capital and real income for businesses and the entire public, which is why the US experienced a post-WW2 economic boom.

In regards to the panic of 1920, it was approximately seven months in length. It had two primary causes: demobilization of US forces and factories had to retool after wartime production. A massive amount of money was put into the hands of US citizens as a direct result of the deficits the government ran - around 12% of GDP - until 1918. And 17% of GDP in 1919. This effectively acted as a stimulus by the time Harding was elected and decided to cut spending. This was how the Roaring Twenties came to fruition from an economic standpoint. Unfortunately, the FED seemed more preoccupied with the exchange rate under the gold standard during this time period. They simply had no desire to formulate a rational domestic policy.

 

[oldfart]

Galbraith was a political hack, who was the 1950's equivalent to Malthus.....And equally shitty at predicting future events.

Little wonder you light candles for him at your shrine to communistic central planning.

As I recall, JKG's great intellectual contribution was the theory that the solution to excessive concentration of power in Big Labor and Big Business was Big Government. His degree was in agricultural economics. As a political and economic thinker he was a pretty good historian.

An aside: I had the good fortune to see Galbraith and Milton Friedman on the same platform a couple of times. His best line was to refer to the pair of them as "the long and the short of it"!

 

[EdwardBaiamonte]

Galbraith was a political hack, who was the 1950's equivalent to Malthus.....And equally shitty at predicting future events.

Little wonder you light candles for him at your shrine to communistic central planning.

As I recall, JKG's great intellectual contribution was the theory that the solution to excessive concentration of power in Big Labor and Big Business was Big Government. His degree was in agricultural economics. As a political and economic thinker he was a pretty good historian.

An aside: I had the good fortune to see Galbraith and Milton Friedman on the same platform a couple of times. His best line was to refer to the pair of them as "the long and the short of it"!

For example, who can forget his infamous 1984 quote that the communist system in the former Soviet Union was superior to capitalism because, according to Galbraith, the communists somehow made better and more efficient use of its "manpower" than did the West? Indeed, to the very end, Galbraith was a socialist impersonating an economist.


John Kenneth Galbraith, an intellectual icon of the Old Left and New Left, said of the Soviets’ overtaking of Poland after World War II: “Russia should be permitted to absorb Poland, the Balkans, and the whole of Eastern Europe in order to spread the benefits of Communism” (Emphasis added).