Australia stimulates itself out of poor economic conditions

[StageLeft]

Originally posted by: Craig234

Originally posted by: Skoorb

every dollar spent by the government creates more than 1 dollar in gdp.

This is just a ridiculous statement. Like trying to fly by pulling hard on your shoe's laces.

Or a poor person getting rich by pulling up on their bootstraps, instead of with the government investing in them?

It's certainly true that some dollars spent by the government return more than they cost; not all, of course, government's charter includes some non-profitable expenses, too.

My rule on government spending has always been, 'spend the dollar if it makes more than a dollar back, and makes sense; or if it meets a justified moral need.'

It's almost impossible to quantify almost all of government's spending from a net made or net lost money perspective. Much (most?) doesn't even try; military spending, medicare, social security, the gov doesn't even try to make money on these, but in cases it does (e.g. tax break for a business so that it will come somewhere) it's still hard.

 

[Craig234]

Originally posted by: Skoorb

Originally posted by: Craig234

Originally posted by: Skoorb

every dollar spent by the government creates more than 1 dollar in gdp.

This is just a ridiculous statement. Like trying to fly by pulling hard on your shoe's laces.

Or a poor person getting rich by pulling up on their bootstraps, instead of with the government investing in them?

It's certainly true that some dollars spent by the government return more than they cost; not all, of course, government's charter includes some non-profitable expenses, too.

My rule on government spending has always been, 'spend the dollar if it makes more than a dollar back, and makes sense; or if it meets a justified moral need.'

It's almost impossible to quantify almost all of government's spending from a net made or net lost money perspective. Much (most?) doesn't even try; military spending, medicare, social security, the gov doesn't even try to make money on these, but in cases it does (e.g. tax break for a business so that it will come somewhere) it's still hard.

I agree; there is a lot of good analysis available on much of the spending, but it's not possible to really say about a lot of the effects.

But the mistake is for people who don't understand that a lot of info is available to post saying false things and that you just can't tell at all.

And some basic things are pretty clear, but ideology gets in the way for many. Hence you get things like 'supply-side economics' fooling a lot of people, when it was pushed. Read that link I posted above, the one that says 'if it works', for some very interesting info about all that, including how the 'supply-side school' wasn't really a school, with just one economist really behind it (the now-discredited Laffer), and how the right-wing figures who sold it say it was really for political purposes, not economic benefit.

 

[dyna]

The greatest stimulus the US could do is provide incentives for corporations to keep their jobs in the US instead of sending them abroad. If people have jobs, the economy will keep on ticking.

 

[JS80]

Originally posted by: dyna
The greatest stimulus the US could do is provide incentives for corporations to keep their jobs in the US instead of sending them aboard. If people have jobs, the economy will keep on ticking.

False.

 

[Praxis1452]

Fucking ridiculous multipliers. I fail to see how the argument that a government spending a dollar is more effective than anyone else spending a dollar.

 

[JS80]

Originally posted by: Praxis1452
Fucking ridiculous multipliers. I fail to see how the argument that a government spending a dollar is more effective than anyone else spending a dollar.

That's because you're an uneducated moron.

 

[lupi]

Originally posted by: Phokus

Originally posted by: MIKEMIKE
i am SOOOO sure that when Bush was giving out his stimulus you said it was a good idea... each and every time he did it... o wait no.

wasn't bush's stimulus tax rebates and tax cuts?

Those happen to be the weakest measures to stimulate the economy

http://www.econbrowser.com/archives/2008/10/zandi.gif

you mean like BHO did too.

 

[Genx87]

These are projections and what does Australia have to do with the United States? I seem to remember Obama making unemployment projections that are so off now it is laughable and all Biden can say is we guessed wrong while Obama tries to tell us in a press conference he didnt realize how bad it really was lol.

Keynes seems to make fine sense on paper until you realize all you are doing is either deficit spending which adds an inflation tax on people down the road or requires higher taxes to pay it off. Or worse requires permament spending to keep the economy from suffering. FDR's recession of 37 imo was an example of pulling govt spending that ends with disaster. It simply cant be done without drastic ripples through the economy. Which is why I yapped about the stimulus bill being a permanent expansion of govt back in Feb. We are building a bubble of govt spending imo.

 

[Genx87]

Originally posted by: Craig234

Originally posted by: dphantom
And does not prove the blanket assertion Keynes government spending = good from liberal big government types.

You misrepresent what Keynes said. What did he say government should do during good times?

Pay down the debt created during the bad times. The problem, how many times did the govt do this from the time it started using this model back in the 30s to its departure in the late 70s and early 80s? I suspect the reality of the model is govt decifit spending is a permanent feature.

 

[Gonad the Barbarian]

Not one stimulating yourself joke yet? Am I even on an internet forum? Shape up people.

 

[Craig234]

Originally posted by: Genx87

Originally posted by: Craig234

Originally posted by: dphantom
And does not prove the blanket assertion Keynes government spending = good from liberal big government types.

You misrepresent what Keynes said. What did he say government should do during good times?

Pay down the debt created during the bad times.

Man, thanks for the honest answer.

The problem, how many times did the govt do this from the time it started using this model back in the 30s to its departure in the late 70s and early 80s? I suspect the reality of the model is govt decifit spending is a permanent feature.

The link I posted earlier in the thread is to a book excerpt that includes discussion of how politicians only follow half of Keynes.

That's why I gave credit - as the book seemed to - to Carter for doing the right but politically painful thing with Volcker and Reagan for keeping it going.

It bascially argues that the 'half-Keynesian' brought the stagflation that forced change.

To try to summarize:

The New Deal brought economic reforms that greatly and permanently (if kept in place) stabilize the economy from the big crashes.

Kennedy had a desire to try to prevent the predicted recession, albeit not severe, in 1962.

One thing he did (contradicting Common Courtesy's claim) was to accelerate already-planned spending to the predicted downturn; it worked. Another thing he tried to do was to push the tax cut from 91% to 70% (or similar), to create (defcit-funded) stimulus, but the Congress and the public were *against* the tax cut if it were borrowed at the time. He worked further on the politics to sell the cut, but it didn't happen until 1964, after the recession.

By then, the justification wasn't preventing the recession, it was to stimulate the economy, and it did great at that, at first. High gworth and low unemployment. Then came the unpleasant parts of Keynes - which meant things like raising interest rates - and the government just refused to do them, and things slid downhill, leading to Carter and Volcker.

We didn't really learn the lesson, though, as the Republicans just brought their own new brand of 'economic voodoo' that was arguably even worse, including massive debt.

 

[JS80]

Originally posted by: Gonad the Barbarian
Not one stimulating yourself joke yet? Am I even on an internet forum? Shape up people.

This isn't ATOT. ATPN has no sense of humor.

 

[Craig234]

Originally posted by: JS80

Originally posted by: Gonad the Barbarian
Not one stimulating yourself joke yet? Am I even on an internet forum? Shape up people.

This isn't ATOT. ATPN has no sense of humor.

Ya, Gonad's comment rubbed me the wrong way.

 

[JS80]

Originally posted by: Craig234

Originally posted by: JS80

Originally posted by: Gonad the Barbarian
Not one stimulating yourself joke yet? Am I even on an internet forum? Shape up people.

This isn't ATOT. ATPN has no sense of humor.

Ya, Gonad's comment rubbed me the wrong way.

Don't stroke his ego.

 

[sandorski]

Originally posted by: JS80

Originally posted by: Craig234

Originally posted by: JS80

Originally posted by: Gonad the Barbarian
Not one stimulating yourself joke yet? Am I even on an internet forum? Shape up people.

This isn't ATOT. ATPN has no sense of humor.

Ya, Gonad's comment rubbed me the wrong way.

Don't stroke his ego.

Self Reliance! PEOPLE!!!

 

[Praxis1452]

Originally posted by: JS80

Originally posted by: Praxis1452
Fucking ridiculous multipliers. I fail to see how the argument that a government spending a dollar is more effective than anyone else spending a dollar.

That's because you're an uneducated moron.

Oh, that's how. Because it's magic.

Oh WAIT, that's horribly stupid.

 

[JS80]

Originally posted by: Praxis1452

Originally posted by: JS80

Originally posted by: Praxis1452
Fucking ridiculous multipliers. I fail to see how the argument that a government spending a dollar is more effective than anyone else spending a dollar.

That's because you're an uneducated moron.

Oh, that's how. Because it's magic.

Oh WAIT, that's horribly stupid.

By your argument there should be no private enterprise. Everything should be government owned?

 

[Acanthus]

Originally posted by: Atreus21

Originally posted by: Craig234

Originally posted by: Atreus21

Originally posted by: Phokus

Originally posted by: Atreus21

Originally posted by: Phokustax cuts?

Those happen to be the weakest measures to stimulate the economy

Uh, Reagan?

http://www.princeton.edu/~pkrugman/reaganlag.png

?

And... uh, Bush?

Besides that, Reagan spent a lot of money via military buildup.

Wikipedia:

During Reagan's presidency, federal income tax rates were lowered significantly with the signing of the bipartisan Economic Recovery Tax Act of 1981.[100] Real gross domestic product (GDP) growth recovered strongly after the 1982 recession and grew during his eight years in office at an annual rate of 3.4% per year.[101] Unemployment peaked at 10.8% percent in December 1982?higher than any time since the Great Depression?then dropped during the rest of Reagan's presidency.[98] Sixteen million new jobs were created, while inflation significantly decreased.[102]

Debt-based prosperity. It was bad for the economy overall, there were far better ways to get things fixed.

I will give credit for one thing to Reagan, his sticking with Carter's Fed chairman Paul Volcker who got inflation under control.

Bad for the economy overall = 16 million jobs created and 3.4% growth over 8 years?

Correlation =/= Causation

Although public and private investment have been time and again proven to drive the economy... Cutting taxes have not proven to drive investment with the same level of efficiency.

 

[glenn1]

Originally posted by: Phokus

Late in, early out of the downturn
Peter Martin Economics Correspondent
June 25, 2009
Australia is set to soar out of its economic downturn.


Something to ponder as we discuss Obama's stimulus bill. The only valid criticism i can think of is that some of the spending isn't coming soon enough.

edit:

Also, government spending provides a much more powerful economic stimulus than tax cuts do:

http://www.econbrowser.com/archives/2008/10/zandi.gif

Something better to ponder is that Australia can afford an economic stimulus program as they have a public debt of only 15.4% to GDP, compared to 60.8% and rising fast for the U.S.

 

[charrison]

I was at one time sold on Keynesian economics, but I am no longer am.
I am defiantly not sold on the current stimulus package as it is too back loaded to do any help and economic indicators have been pointing upward since before it passed. Right now the economy slowly continues to improve and yet little of the stimulus has been spent. The economy was going to improve no matter what the government was spending.

I fear this huge package could very well have very negative impacts long term.

 

[tk149]

Originally posted by: JS80

Originally posted by: Craig234

Originally posted by: JS80

Originally posted by: Gonad the Barbarian
Not one stimulating yourself joke yet? Am I even on an internet forum? Shape up people.

This isn't ATOT. ATPN has no sense of humor.

Ya, Gonad's comment rubbed me the wrong way.

Don't stroke his ego.

/slowly backs out of thread

 

[Craig234]

Originally posted by: charrison
I was at one time sold on Keynesian economics, but I am no longer am.
I am defiantly not sold on the current stimulus package as it is too back loaded to do any help and economic indicators have been pointing upward since before it passed. Right now the economy slowly continues to improve and yet little of the stimulus has been spent. The economy was going to improve no matter what the government was spending.

I fear this huge package could very well have very negative impacts long term.

Your objections are less about Keynesian economics, than about suspicions that the current situation is beig hijacked to apply Keynesian measures that don't fit it.

It's like the difference between being 'against hedge funds', and 'against the guy who lied to investors and stole from them using a hedge fund'.

It's not easy for the lay citizen to try to discern whether the situation is being misrepresented and taken advantage of.

I think most reasonable people can be worried about the problems the stimulus spending causes. The question is whether the people are right who said the alternative is worse.

This fits right into the 'Shock Doctrine' playbook - 'make this radical change that's normally politically impossible, or you face disaster' - the question is whether it's accurate.

We do have a lot of people sayingit is from diverse political backgrounds from Alan Greenspan to Ben Bernake to Paul Krugman to Barack Obama among others.

As for Keynesian economics, that's just one part of a plan. There are a lot of details.

There are threats to the economy with or without the stimulus - not just the US but the global economy.

We've had a lot of comfort come from prosperity - some of it resting on others' suffering. As times change we might see more problems, including political.

It's one thing for us to sit here and discuss how our demoracy prevents some of the better but less politically viable economic policies to get approved; it's quite another for economic leaders who understand that, and have a strong interest in changing it, from doing so. Democracy is increasingly the enemy of the wealthy though there's always been some conflict.

 

[Craig234]

Originally posted by: tk149

Originally posted by: JS80

Originally posted by: Craig234

Originally posted by: JS80

Originally posted by: Gonad the Barbarian
Not one stimulating yourself joke yet? Am I even on an internet forum? Shape up people.

This isn't ATOT. ATPN has no sense of humor.

Ya, Gonad's comment rubbed me the wrong way.

Don't stroke his ego.

/slowly backs out of thread

You'll come again.

 

[charrison]

Originally posted by: Craig234

Originally posted by: charrison
I was at one time sold on Keynesian economics, but I am no longer am.
I am defiantly not sold on the current stimulus package as it is too back loaded to do any help and economic indicators have been pointing upward since before it passed. Right now the economy slowly continues to improve and yet little of the stimulus has been spent. The economy was going to improve no matter what the government was spending.

I fear this huge package could very well have very negative impacts long term.

Your objections are less about Keynesian economics, than about suspicions that the current situation is beig hijacked to apply Keynesian measures that don't fit it.

That is very well part of it. And It is quite obvious that is part of problem with package, as most of the spending is very back loaded, which is exactly the opposite of Keynesian policy.

This package was too large, too back loaded and with too much pork.


And I think as far as keynesian economics go, I think a large portion of Americans have figured out that policy is nothing more than government pick pickpocketing the indifivual and giving some of his change back. People know it is a shell game.

 

[Praxis1452]

Originally posted by: JS80

Originally posted by: Praxis1452

Originally posted by: JS80

Originally posted by: Praxis1452
Fucking ridiculous multipliers. I fail to see how the argument that a government spending a dollar is more effective than anyone else spending a dollar.

That's because you're an uneducated moron.

Oh, that's how. Because it's magic.

Oh WAIT, that's horribly stupid.

By your argument there should be no private enterprise. Everything should be government owned?

I disagree with the idea that the government spending a dollar is more effective than anyone else spending a dollar.

How that fuck does that translate into "by your argument their should be no private enterprise".

You're pretty much a troll. A really really bad one at that.