Pages: 1 2
Keynesian economics is simply government trying to drive the economy through interest rates etc... Doesn't work too well when people live on credit like crazy.Flaming_Maniac wrote:
4 - The free market works with zero government intervention. Hence "free". Trickle down economics is not "how capitalism works".
People living on credit has nothing to do with it. Not applying the other half of Keynesian economics that no one wants to talk about is the problem.Cybargs wrote:
Keynesian economics is simply government trying to drive the economy through interest rates etc... Doesn't work too well when people live on credit like crazy.Flaming_Maniac wrote:
4 - The free market works with zero government intervention. Hence "free". Trickle down economics is not "how capitalism works".
It is political suicide not to attempt to intervene as well... It's a lose-lose situation. Hoover got voted out because the people were pissed he didn't do anything.
1. Keynesian economic theory failed during the 70s when there was both rampant inflation and unemployment. According to his General Theory, it should've never occurred. It's why Volcker was brought in to lead the Fed. He tamed inflation and unemployment went down as a consequence. He rejected Keynes and replaced him with the Monetarist theories of Friedman. Since this time, Rep/Dem economic policies have reflected an ideological battle between Keynes and Friedman rather than Capitalism/Socialism.Flaming_Maniac wrote:
Your most recent statements are a minefield of logical fallacies.
1 - Assuming all else true, Keynes by FDR failed. Not the economic theory as a whole. By any standard the political implementation was weak at best.
2 - WW2 dragging us out of the Great Depression doesn't mean Keynesian economics failed.
3 - We clearly did get out of the hole. It even looked like things were getting better well before WWII - but then as soon as things began to look up, the White House immediately switched back to the old way of thinking and undid all the progress they had made.
4 - The free market works with zero government intervention. Hence "free". Trickle down economics is not "how capitalism works".
Last edited by JohnG@lt (2010-02-25 20:49:06)
Hmm2 & 3. No, he's stating that Keynesian economics had nothing to do with the recovery at all. It had everything to do with WWII, the rampup of American industry and the void we filled in the destroyed economies of war torn Europe and Asia.
Keynesian economics by FDR clearly failed, because we never got out of the hole. and now that were at the bottom of the hole, digging deeper isnt going to get us out either.
Well, the stimulus wasn't framed correctly regardless. Keynes recommended deficit spending only for things that you would get a return on investment large enough to make it worthwhile. The only thing that really qualifies is infrastructure spending. Reagan used deficit spending to update and expand the military which fueled job growth for a while but the investment had no real return which makes it a failure. The stimulus of '09 was purely deficit spending with perhaps 10% of it allocated to 'shovel ready' infrastructure programs while the rest went to preservation of state government jobs. While there would've been a return on the 10% if it had been allocated wisely, it wasn't, and the money was generally disbursed willy nilly in order to create silly things like the Tampa-Orlando high speed railway that the state of Florida already rejected at least twice previouslyFlaming_Maniac wrote:
I'm not going to categorically defend Keynes.
He stated "Keynesian economics by FDR clearly failed, because we never got out of the hole. and now that were at the bottom of the hole, digging deeper isnt going to get us out either." and then, quite succinctly "ww2". Fact is that proves nothing. Just because the particular massive government spending (er what was Keynes on about again ) came from a political war effort and not specifically an economic stimulus does not prove that Keynesian economics at similar levels would not have done the same. It's like claiming the recent stimulus packages did or did not work based on the results...nothing can be proven conclusively.
I'm going to go ahead and call bullshit, considering this is the guy who allegedly said we should dig holes and fill them up again.JohnG@lt wrote:
Well, the stimulus wasn't framed correctly regardless. Keynes recommended deficit spending only for things that you would get a return on investment large enough to make it worthwhile. The only thing that really qualifies is infrastructure spending. Reagan used deficit spending to update and expand the military which fueled job growth for a while but the investment had no real return which makes it a failure. The stimulus of '09 was purely deficit spending with perhaps 10% of it allocated to 'shovel ready' infrastructure programs while the rest went to preservation of state government jobs. While there would've been a return on the 10% if it had been allocated wisely, it wasn't, and the money was generally disbursed willy nilly in order to create silly things like the Tampa-Orlando high speed railway that the state of Florida already rejected at least twice previouslyFlaming_Maniac wrote:
I'm not going to categorically defend Keynes.
He stated "Keynesian economics by FDR clearly failed, because we never got out of the hole. and now that were at the bottom of the hole, digging deeper isnt going to get us out either." and then, quite succinctly "ww2". Fact is that proves nothing. Just because the particular massive government spending (er what was Keynes on about again ) came from a political war effort and not specifically an economic stimulus does not prove that Keynesian economics at similar levels would not have done the same. It's like claiming the recent stimulus packages did or did not work based on the results...nothing can be proven conclusively.
No, he said it would be silly to become dependent on 'digging holes and filling them up again' i.e. 'make work' is useless. There has to be some purpose to the spending and thus a return on any investment made.Flaming_Maniac wrote:
I'm going to go ahead and call bullshit, considering this is the guy who allegedly said we should dig holes and fill them up again.JohnG@lt wrote:
Well, the stimulus wasn't framed correctly regardless. Keynes recommended deficit spending only for things that you would get a return on investment large enough to make it worthwhile. The only thing that really qualifies is infrastructure spending. Reagan used deficit spending to update and expand the military which fueled job growth for a while but the investment had no real return which makes it a failure. The stimulus of '09 was purely deficit spending with perhaps 10% of it allocated to 'shovel ready' infrastructure programs while the rest went to preservation of state government jobs. While there would've been a return on the 10% if it had been allocated wisely, it wasn't, and the money was generally disbursed willy nilly in order to create silly things like the Tampa-Orlando high speed railway that the state of Florida already rejected at least twice previouslyFlaming_Maniac wrote:
I'm not going to categorically defend Keynes.
He stated "Keynesian economics by FDR clearly failed, because we never got out of the hole. and now that were at the bottom of the hole, digging deeper isnt going to get us out either." and then, quite succinctly "ww2". Fact is that proves nothing. Just because the particular massive government spending (er what was Keynes on about again ) came from a political war effort and not specifically an economic stimulus does not prove that Keynesian economics at similar levels would not have done the same. It's like claiming the recent stimulus packages did or did not work based on the results...nothing can be proven conclusively.
In looking for the quote I found this.
http://www.businessweek.com/blogs/money … eynes.html
In reference to burying money and letting private firms pay people to dig it out again.Keynes wrote:
It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing.
So are you arguing for or against a 'stimulus'?Flaming_Maniac wrote:
In reference to burying money and letting private firms pay people to dig it out again.Keynes wrote:
It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing.
But your statements are false.Flaming_Maniac wrote:
I'm not going to categorically defend Keynes.
Which ones, and why?Flaming_Maniac wrote:
But your statements are false.Flaming_Maniac wrote:
I'm not going to categorically defend Keynes.
Because Keynes saidJohnG@lt wrote:
No, he said it would be silly to become dependent on 'digging holes and filling them up again' i.e. 'make work' is useless. There has to be some purpose to the spending and thus a return on any investment made.
This was pretty straightforward, you just tried to change the subject a couple posts ago.Flaming_Maniac wrote:
In reference to burying money and letting private firms pay people to dig it out again.Keynes wrote:
It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing.
Because I was using this:Flaming_Maniac wrote:
Because Keynes saidJohnG@lt wrote:
No, he said it would be silly to become dependent on 'digging holes and filling them up again' i.e. 'make work' is useless. There has to be some purpose to the spending and thus a return on any investment made.This was pretty straightforward, you just tried to change the subject a couple posts ago.Flaming_Maniac wrote:
In reference to burying money and letting private firms pay people to dig it out again.Keynes wrote:
It would, indeed, be more sensible to build houses and the like; but if there are political and practical difficulties in the way of this, the above would be better than nothing.
I wasn't changing the subject, just using a different quote from the same article to make my point.Keynes wrote:
"To dig holes in the ground," paid for out of savings, will increase, not only employment, but the real national dividend of useful goods and services. It is not reasonable, however, that a sensible community should be content to remain dependent on such fortuitous and often wasteful mitigations
Last edited by Hurricane2k9 (2010-02-25 21:42:45)
Ok, I was wrong. Requiring a ROI was my own addition.Flaming_Maniac wrote:
He didn't say they were "useless". The whole point of Keynes is pushing the economy to the norm in the short term, not maintaining expansionist or contractionist policy indefinitely. Digging ditches has its place in Keynes and you ruled it out entirely ("Keynes recommended deficit spending only for things that you would get a return on investment large enough to make it worthwhile.").
Your subject change was here.
Pages: 1 2