The ultimate vindication of Republican supply-side economics

[stans]

I think too Stans probably ought to read a different history re Germany's recovery from the Great Depression. It was not the rosy picture he seems to think it was. Germany did do better than the more socialized European nations in recovery from the current recession mostly because it did not dramatically increase its national debt in ill advised and reckless government spending. Therefore it has pretty well returned to its normal which is still a fairly lack luster economy with "permanent" unemployment at a much higher level than most thinking Americans accept as normal. It currently is at 7.4% which is pretty good for them.

I'm blinded by all of your references describing the 1936 and on economic picture in Germany. What does today's German unemployment rate have to do with the unemployment rate 80 years ago, spaced by WWII and with completely different governments? Remember that, postwar there was East Germany with a moribund economy and West Germany with a healthy economy. You speak in generalities, with absolutely no knowledge of what you speak of. Germany increased it's national debt drastically, and yes, spending on infrastructure wasn't ill advised. But in 1933-1938 no country was spending on anything except Austria that went through it's own economic upsurge, by imitating Germany's policies, right after Germany annexed Austria. You just like to hear yourself babble. Try posting something of substance that is accurate.

 

[Foxfyre]

I think too Stans probably ought to read a different history re Germany's recovery from the Great Depression. It was not the rosy picture he seems to think it was. Germany did do better than the more socialized European nations in recovery from the current recession mostly because it did not dramatically increase its national debt in ill advised and reckless government spending. Therefore it has pretty well returned to its normal which is still a fairly lack luster economy with "permanent" unemployment at a much higher level than most thinking Americans accept as normal. It currently is at 7.4% which is pretty good for them.

I'm blinded by all of your references describing the 1936 and on economic picture in Germany. What does today's German unemployment rate have to do with the unemployment rate 80 years ago, spaced by WWII and with completely different governments? Remember that, postwar there was East Germany with a moribund economy and West Germany with a healthy economy. You speak in generalities, with absolutely no knowledge of what you speak of. Germany increased it's national debt drastically, and yes, spending on infrastructure wasn't ill advised. But in 1933-1938 no country was spending on anything except Austria that went through it's own economic upsurge, by imitating Germany's policies, right after Germany annexed Austria. You just like to hear yourself babble. Try posting something of substance that is accurate.

Once you go ad hominem my friend, you demonstrate that you are out of ammo, can't defend your position, and lose the debate.

 

[stans]

I think too Stans probably ought to read a different history re Germany's recovery from the Great Depression. It was not the rosy picture he seems to think it was. Germany did do better than the more socialized European nations in recovery from the current recession mostly because it did not dramatically increase its national debt in ill advised and reckless government spending. Therefore it has pretty well returned to its normal which is still a fairly lack luster economy with "permanent" unemployment at a much higher level than most thinking Americans accept as normal. It currently is at 7.4% which is pretty good for them.

I'm blinded by all of your references describing the 1936 and on economic picture in Germany. What does today's German unemployment rate have to do with the unemployment rate 80 years ago, spaced by WWII and with completely different governments? Remember that, postwar there was East Germany with a moribund economy and West Germany with a healthy economy. You speak in generalities, with absolutely no knowledge of what you speak of. Germany increased it's national debt drastically, and yes, spending on infrastructure wasn't ill advised. But in 1933-1938 no country was spending on anything except Austria that went through it's own economic upsurge, by imitating Germany's policies, right after Germany annexed Austria. You just like to hear yourself babble. Try posting something of substance that is accurate.

Once you go ad hominem my friend, you demonstrate that you are out of ammo, can't defend your position, and lose the debate.

My attack isn't based upon irrelevent facts. It's based upon the fact that you're spouting opinions without a single refernce to back up anything that you say. You've said nothing specific, just generalities. Let me see a reference to anything you've said. I lose the debate? Dream on.

Here's your whole argument "I think too Stans probably ought to read a different history re Germany's recovery from the Great Depression. It was not the rosy picture he seems to think it was." and then you said absolutely nothing about Germany's Great Depression recovery again. All that you have is your opinion without any substantiating reference or argument that describes Germany's economic condition at that time.

 

[Foxfyre]

I'm blinded by all of your references describing the 1936 and on economic picture in Germany. What does today's German unemployment rate have to do with the unemployment rate 80 years ago, spaced by WWII and with completely different governments? Remember that, postwar there was East Germany with a moribund economy and West Germany with a healthy economy. You speak in generalities, with absolutely no knowledge of what you speak of. Germany increased it's national debt drastically, and yes, spending on infrastructure wasn't ill advised. But in 1933-1938 no country was spending on anything except Austria that went through it's own economic upsurge, by imitating Germany's policies, right after Germany annexed Austria. You just like to hear yourself babble. Try posting something of substance that is accurate.

Once you go ad hominem my friend, you demonstrate that you are out of ammo, can't defend your position, and lose the debate.

My attack isn't based upon irrelevent facts. It's based upon the fact that you're spouting opinions without a single refernce to back up anything that you say. You've said nothing specific, just generalities. Let me see a reference to anything you've said. I lose the debate? Dream on.

Here's your whole argument "I think too Stans probably ought to read a different history re Germany's recovery from the Great Depression. It was not the rosy picture he seems to think it was." and then you said absolutely nothing about Germany's Great Depression recovery again. All that you have is your opinion without any substantiating reference or argument that describes Germany's economic condition at that time.

There is nothing to say other than the Great Depression created such hard times in Germany and created such discord in the German government, that it provided the foothold that Hitler needed to rise to power. Perhaps you want to suggest that the USA needs a Hitler to get out of the current recession? I doubt you would suggest that. But if you read the honest history, you will see that this is the way it went.

I get most of my understanding of history from history books as too many internet sites are skewed are flawed. But here's a pretty decent mini history of those events:

The History Place - Rise of Hitler: Great Depression Begins

 

[EdwardBaiamonte]

We supply-sided ourselves into a freakin serious depression.

Nice work, Randians.

We did? I'll give you $10,000 if you have evidence of that. Bet? or admit to being a liberal.

 

[EdwardBaiamonte]

Why isn't it working now?

too many other problems like a dead housing market, huge fear of inflation, European collapse, China/India assention, socialist health care, communist president, zombie banks, unemployment compensation, stronger unions, fear of debt and deficit, distorting & artificial Fed stimulus, etc etc.

Money supply is more than ample now, it's just not being used the way you'd like to see it used to support the theory. Our system is, the Fed creates the money and banks choose to lend it out or not. The Fed makes money available but it's not expansionary the way the banks are using it.

generally it causes inflation or mal-investment, not real expansion so you're not thinking straight

The Fed isn't controlling nominal spending now so under present conditions fiscal stimulus is needed.

too stupid yet perfecty liberal. We are $16 trillion in debt from fiscal stimulus!

You claim that money is (should be) expansionary, not me.

expansion from the stone age to here was caused by engineers, not liberal magic money

 

[Foxfyre]

We supply-sided ourselves into a freakin serious depression.

Nice work, Randians.

We did? I'll give you $10,000 if you have evidence of that. Bet? or admit to being a liberal.

Agreed. A properly regulated free market economy doesn't produce depressions. (By properly regulated meaning that everybody's unalienable, legal, and constitutional rights are recognized and protected to prevent us from doing intentional physical or economic violence to each other.) Normal supply and demand will naturally create ebbs and flows in the economic environment and occasional mild recessions are inevitable, normal, and of little significant consequence. Depressions and/or deep recessions are almost always due to factors outside of a properly regulated free market.

The Great Depression beginning in 1930 was not wholly due to government meddling or lack of proper oversight--the government wasn't responsible for a severe 10-year drought for instance--but it would have not been nearly as severe without some serious government mistakes. Smoot Hawley, for instance, was part of it when it severely hampered trade and put export businesses into a tail spin. The government not properly regulating the banks and allowing them to loan money to buy stocks while using those same stocks as collateral was a prescription for disaster. It would be akin to loaning money to buy a new car or house with no down payment and using the speculation that the house or car would appreciate in value and become the collateral. That one factor created an unhealthy specualtion in the stock market that led to such overpriced stocks and bonds that a crash was inevitable. And when the borrowers then had no way to repay the banks, the banks failed en masse just as they did in 2008. As there was no FDIC or similar program at that time, even those who had not engaged in any risky behavior lost their life savings when their bank failed and closed. And, of course, the panic when a bank got into trouble created runs on those banks hastening their demise.

And then when first Hoover and then FDR tried to use the government to fix things in the private sector, it helped out some folks, but many economists believe it prolonged the Depression by many years just as Obamanomics has almost certainly deepened and prolonged the current recession and/or slow recovery.

There simply is not substitute for a free market in the hands of a free people. No government can even hope to marginally compete with that.

 

[stans]

Once you go ad hominem my friend, you demonstrate that you are out of ammo, can't defend your position, and lose the debate.

My attack isn't based upon irrelevent facts. It's based upon the fact that you're spouting opinions without a single refernce to back up anything that you say. You've said nothing specific, just generalities. Let me see a reference to anything you've said. I lose the debate? Dream on.

Here's your whole argument "I think too Stans probably ought to read a different history re Germany's recovery from the Great Depression. It was not the rosy picture he seems to think it was." and then you said absolutely nothing about Germany's Great Depression recovery again. All that you have is your opinion without any substantiating reference or argument that describes Germany's economic condition at that time.

There is nothing to say other than the Great Depression created such hard times in Germany and created such discord in the German government, that it provided the foothold that Hitler needed to rise to power. Perhaps you want to suggest that the USA needs a Hitler to get out of the current recession? I doubt you would suggest that. But if you read the honest history, you will see that this is the way it went.

I get most of my understanding of history from history books as too many internet sites are skewed are flawed. But here's a pretty decent mini history of those events:

The History Place - Rise of Hitler: Great Depression Begins

Hitler rose to power in January 1933. Keynesian policies didn't start till AFTER he came into power, a few months later iirc.

That's your suggestion, not mine. Perhaps you want to suggest it.

Now the meat of my reply. You might want to review your history book a bit more carefully.

[John Kenneth Galbraith, wrote: “… The elimination of unemployment in Germany during the Great Depression without inflation -- and with initial reliance on essential civilian activities -- was a signal accomplishment.” -- and “large scale borrowing for public expenditures, and at first this was principally for civilian work -- railroads, canals and the Autobahnen [highway network]. The result was a far more effective attack on unemployment than in any other industrial country.” “By late 1935, unemployment was at an end in Germany./1

1. J. K. Galbraith, Money (Boston: 1975), pp. 225-226


Germany, by the late thirties, had full employment at stable prices. It was, in the industrial world, an absolutely unique achievement.” / 2]

2. J. K. Galbraith, The Age of Uncertainty (1977), pp. 214.


[Sebastian Haffner, an influential German journalist and historian who was a fierce critic of the Third Reich and its ideology, reviewed Hitler’s life and legacy in a much-discussed book. Although his portrayal of Hitler in The Meaning of Hitler is a harsh one, the author all the same wrote: Hitler and his new government “immediately launched an all-out assault on unemployment … They stimulated private industry through subsidies and tax rebates, encouraged consumer spending by such means as marriage loans, and plunged into the massive public-works program that produced the autobahn [highway system], and housing, railroad and navigation projects.” / 6]

[ The regime’s new leaders also succeeded in persuading formerly skeptical and even hostile Germans of their sincerity, resolve, and ability. This fostered trust and confidence, which in turn encouraged businessmen to hire and invest, and consumers to spend with an eye to the future./6]

6. John A. Garraty, “The New Deal, National Socialism, and the Great Depression,” The American Historical Review, Oct. 1973 (Vol. 78, No. 4), pp. 909-910


“Among the positive achievements of Hitler, the one outshining all others was his economic miracle.” While the rest of the world was still mired in the economic paralysis, Hitler had made “Germany an island of prosperity.” Within three years, “crying need and mass hardship had generally turned into modest but comfortable prosperity” Even more miraculous was the fact that the transition from depression to economic boom had been accomplished without inflation, at totally stable wages and prices./45]

45. S. Haffner, The Meaning of Hitler (New York: Macmillan, 1979), pp. 27-29. First published in 1978 under the title Anmerkungen zu Hitler. See also: M. Weber, “Sebastian Haffner's 1942 Call for Mass Murder,” The Journal of Historical Review, Fall 1983 (Vol. 4, No. 3), pp. 380-382.

These quotes were taken from an article by Mark Weber, a historian at the Institute for Historical Review. The article is entitled How Hitler Tackled Unemployment and Revived Germany's Economy.

 

[stans]

We supply-sided ourselves into a freakin serious depression.

Nice work, Randians.

We did? I'll give you $10,000 if you have evidence of that. Bet? or admit to being a liberal.

Agreed. A properly regulated free market economy doesn't produce depressions. (By properly regulated meaning that everybody's unalienable, legal, and constitutional rights are recognized and protected to prevent us from doing intentional physical or economic violence to each other.) Normal supply and demand will naturally create ebbs and flows in the economic environment and occasional mild recessions are inevitable, normal, and of little significant consequence. Depressions and/or deep recessions are almost always due to factors outside of a properly regulated free market.

The Great Depression beginning in 1930 was not wholly due to government meddling or lack of proper oversight--the government wasn't responsible for a severe 10-year drought for instance--but it would have not been nearly as severe without some serious government mistakes. Smoot Hawley, for instance, was part of it when it severely hampered trade and put export businesses into a tail spin. The government not properly regulating the banks and allowing them to loan money to buy stocks while using those same stocks as collateral was a prescription for disaster. It would be akin to loaning money to buy a new car or house with no down payment and using the speculation that the house or car would appreciate in value and become the collateral. That one factor created an unhealthy specualtion in the stock market that led to such overpriced stocks and bonds that a crash was inevitable. And when the borrowers then had no way to repay the banks, the banks failed en masse just as they did in 2008. As there was no FDIC or similar program at that time, even those who had not engaged in any risky behavior lost their life savings when their bank failed and closed. And, of course, the panic when a bank got into trouble created runs on those banks hastening their demise.

And then when first Hoover and then FDR tried to use the government to fix things in the private sector, it helped out some folks, but many economists believe it prolonged the Depression by many years just as Obamanomics has almost certainly deepened and prolonged the current recession and/or slow recovery.
There simply is not substitute for a free market in the hands of a free people. No government can even hope to marginally compete with that.

Exactly how? By insufficient deficit spending! Look at the list of references I just gave you in my previous posting. All based on deficit spending.

 

[itfitzme]

1) Do we agree that stable NGDP will prevent demand-side recessions?
2) Does this mean we should have the central bank target NGDP rather than inflation?
3) Can the central bank actually achieve an NGDP target?

I'm simply looking for positive economics. I see no reason to have a normative position of something without understanding the the positive economics first. Like the gold standard, for instance. Until I found that there was sufficient information to come to a reasonable conclusion, I couldn't really have a position. There are enough people in this world with unqualified opinions.

That's not what I see:

Well, doesn't that just suck. There is a first time for everything. Back in May of 2008, I recall concluding that it appeared as if efficiency bumped up on the recession. And, it made sense given the reports of people working extra hours to ensure that their company made it through. Perhaps I was a bit biased on my personal experience at the time.

 

[EdwardBaiamonte]

Exactly how? By insufficient deficit spending! Look at the list of references I just gave you in my previous posting. All based on deficit spending.

what to the "references" indicate

 

[stans]

that things were going well economically in Germany from 1935 and on. It's all in the previous posts in this thread.

 

[EdwardBaiamonte]

that things were going well economically in Germany from 1935 and on. It's all in the previous posts in this thread.

and the point is???

 

[stans]

read the last 20 posts in the thread to find out --------- post #219

 

[EdwardBaiamonte]

read the last 20 posts in the thread to find out --------- post #219

how will you learn if you are afraid to try? Go for it!!

 

[stans]

afraid to try what?

 

[EdwardBaiamonte]

afraid to try what?

to state your point?

 

[stans]

the refs were proof of my point, that things were rosy economically in Germany in 1935 and beyond. he referenced a book in general. I ref'd 4 qoutes from 3 books at specific pages with the specific content. Did you read the refs? Did you read my article Reduce Unemployment with Little Price Increase

 

[EdwardBaiamonte]

the refs were proof of my point, that things were rosy economically in Germany in 1935 and beyond. he referenced a book in general. I ref'd 4 qoutes from 3 books at specific pages with the specific content. Did you read the refs? Did you read my article Reduce Unemployment with Little Price Increase

a pre-war Nazi economy has little to teach us I'm afraid. What do you think we can learn from it?

 

[stans]

Read the article or next to the last section if you don't want to read the whole article. We can learn the article title, i.e. how to reduce unemployment