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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Steve Lokness who wrote (172830)	9/29/2011 11:45:41 AM
From: Mary Cluney	Read Replies (1) \| Respond to of 544072

<<<If you believe in Keynesian magic - this should have worked way better than a government plan to do infrastructure for instance that has a lag time. >>> You are mixing up two points. The Obama economic advisors are mostly (almost all) keynesian. What Krugman said was that they were too timid. They didn't stimulate the economy sufficiently to get out of this mess. But he also implied that if we did not stimulate the economy at all, the current situation would be far worse. But, how was he not telling the truth?

To: Steve Lokness who wrote (172830)	9/29/2011 11:51:02 AM
From: Cogito	Read Replies (1) \| Respond to of 544072

>>I say it is lying. To suggest we did Tarp, the auto bailout, gave everyone a tax break - and threw a lot of money at every single place we could find that was ready to accept the money is EXACTLY Keynesian policy. So was the the policy of Bernanke and the Fed. .......Koan, the idea of Keynesian is for the government to borrow and get that borrowed money in the hands of the consumer - the fastest way to do that is with a tax cut. That tax cut was paid for by government borrowing - pure and OBVIOUS Keynesian thinking. If you believe in Keynesian magic - this should have worked way better than a government plan to do infrastructure for instance that has a lag time. << I think what Krugman is saying is that the Keynesian policy would have been to first calculate the total amount of stimulus that was required and to apply that. What happened was a sort of a stab at what Keynes would have done, but it wasn't the same thing, because in these situations, size matters. So there would be a threshold at which one could say the government's policy was truly Keynesian, but below that threshold, it wouldn't be, even if it was moving in that direction. I'm only jumping in because I don't like to see people talking past one another, and I thought this might help. Probably not.

To: Steve Lokness who wrote (172830)	9/29/2011 12:56:21 PM
From: bentway	Read Replies (1) \| Respond to of 544072

"and threw a lot of money at every single place we could find that was ready to accept the money is EXACTLY Keynesian policy" If I gave you HALF the antibiotics you needed, would you get well? Would you then claim that the medicine had failed? I think the stimulus was horribly inefficient.

To: Steve Lokness who wrote (172830)	9/29/2011 1:17:38 PM
From: koan	Read Replies (1) \| Respond to of 544072

<<Koan, the idea of Keynesian is for the government to borrow and get that borrowed money in the hands of the consumer - the fastest way to do that is with a tax cut. That tax cut was paid for by government borrowing - pure and OBVIOUS Keynesian thinking. If you believe in Keynesian magic - this should have worked way better than a government plan to do infrastructure for instance that has a lag time.>> Tax cuts are the worst way to stimulate the economy. People usually save it or pay off bills. What do you think the rich do with tax cuts? Hiring unemployed people is the best way to stimulate the economy. They spend that money. That is waht we need. consumer demand. The full employment of the WWII stimulus is the perfect example and was just a massive stimulus program and pulled us right out of the depression. Obama was convinced to make 40% of the stimulus program tax cuts and that is exactly what Krugman is objecting to. The whole problem in the US has been that taxes are way too low. The right wing has been selling that snake oil (tax cuts are good) for 30 years and driven this country into a ditch. Look at the big deficits since 1980. They all took place under Republican presidents. Because they cut taxes (on their rich buddies) and borrow to spend. Clinton raised taxes and balanced the budget. And also created 22 million jobs.