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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: combjelly who wrote (685875)	11/22/2012 11:19:18 PM
From: i-node	Read Replies (1) \| Respond to of 1579676

>> The deficit spending that Reagan engaged in was very stimulative. This doesn't even pass the laugh test. Hell, Laffer himself has plainly stated that government spending is not stimulative and in fact tends to depress an economy -- which is consistent with the results under FDR, Clinton and Obama. Laffer: "In country after country, increased government spending acted more like a depressant than a stimulant." Of the 34 nations in the Organization for Economic Cooperation and Development, those with the largest spending increases from 2007 to 2009 experienced the least growth in gross domestic product rates before and after the stimulus, Laffer notes. Moreover, Estonia, Ireland, the Slovak Republic and Finland, the four nations with the biggest stimulus programs, had the steepest declines in growth. And you still cannot point to a bonafide incident where Keynes has worked. Not one. Certainly, the most well known Keynesian stimulus programs have failed miserably. And the fact that the entire concept contradicts everything we know about economics sort of shoots a hole in the idea to begin with.

To: combjelly who wrote (685875)	11/23/2012 2:00:26 AM
From: Tenchusatsu	1 Recommendation Read Replies (1) \| Respond to of 1579676

CJ, you are just making everything up. Stagflation was never a consideration in classic Keynesian economics. Even now no macroeconomic theory can reliably predict when stagflation will occur. Claiming that high interest rates is "Keynesian" is a silly claim. Traditionally high interest rates would lead to economic contraction, which is indeed what happened when Volcker resorted to them. Yet the economy recovered after that thanks to Reagan-style supply-side economics. Short-term pain for long-term gain. Like I said, there are reasons why Keynesian economics fell out of favor after the 70's. The only reason why Keynesianism is making a comeback is because the allure of using government policy to artifically boost GDP is too strong for liberals to resist. Tenchusatsu