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Battered Britain hovers on the edge of double-dip recession OFFICIAL: Double dip!!!

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fskimospy

Elite Member
Mar 10, 2006
73,721
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Nonsense. Are you being purposely obtuse? He said confidence is the key factor today. Any results of changes in that confidence (which, by the way, is impacted by a multitude of additional factors beyond spending levels) won't actually be felt for an extended period of time. For example, capital investment decisions take at least a year or two before they are really felt.
This is truly bizarre self delusion. I am unaware of any credible source that interprets his statements in that way. Can you provide one? Not to mention the fact that this quote came from 2010, nearly 2 years ago, and things have become dramatically worse in that time. Even by your standard he was horribly wrong. There is no evidence whatsoever that he was attempting to state that austerity measures would lead to economic contraction for several years, followed by better expansion in the long term.


For starters, you're incorrectly assuming any of the economies do poorly because of austerity. They are doing poorly for a variety of factors, austerity is a mechanism to correct for prior mismanagement. Second, if you'd like to look, the GBP has also been climbing against the USD and other currencies this year, the market is showing confidence in the GBP even though it's in a double dip recession.
No, basically all economic evidence points to decreases in public sector spending as a major driving force in economic contraction. This really isn't open for debate. Furthermore, a number of these countries undertaking austerity measures were not poorly managed in the past. As I have already used as an example, Spain had a budget surplus and a debt/GDP ratio of ~26% before the crisis. That is not 'mismanagement' by any reasonable definition.

Don't think I didn't catch your shift however. Your original argument was that the UK being viewed as a better investment opportunity than continental Europe was due to austerity measures. When you were reminded that Europe was also undertaking these, you suddenly tried to shift to exchange rates. Sorry, that's not how it works.
 

BoberFett

Lifer
Oct 9, 1999
37,563
9
81
You just have to ignore people like eskimospy. There is a bottom limit to spending: $0. They can point to that and say "See, spending $0 doesn't work!!! Your policy is a failure!" But there is no upper limit to spending. No matter how badly their ideas work, they can always say "But the problem was you didn't spend enough."
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
136
You just have to ignore people like eskimospy. There is a bottom limit to spending: $0. They can point to that and say "See, spending $0 doesn't work!!! Your policy is a failure!" But there is no upper limit to spending. No matter how badly their ideas work, they can always say "But the problem was you didn't spend enough."
Oh Boberfett, if you didn't have straw man arguments I sometimes wonder if you would have any arguments at all.
 

senseamp

Lifer
Feb 5, 2006
35,060
5,144
126
You just have to ignore people like eskimospy. There is a bottom limit to spending: $0. They can point to that and say "See, spending $0 doesn't work!!! Your policy is a failure!" But there is no upper limit to spending. No matter how badly their ideas work, they can always say "But the problem was you didn't spend enough."
Stimulus worked great when it was in place.

Austerity failed when it was tried. But no matter how badly that idea worked, you can always say, but America is totally different, it didn't work for anyone else, but it will work for us, because Paul Ryan and Mitt Romney said so.
 

PokerGuy

Lifer
Jul 2, 2005
13,650
199
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So in other words, basically nothing will ever shake your belief in it.
If you mean the belief that spending should not outpace income? Correct, nothing will ever change my mind that logically spending can not outpace income forever. Simple math. If I've ever said that "austerity" is the right answer for every country in every situation, then please show me where I did. Obviously it's not the right tool at the right time for every situation, but the basic logic that spending should not outpace income in the long run is basic math and basic logic that applies to all entities.

If you can't tell us a set of circumstances by which your ideas will be proven wrong, they are simply articles of faith.
Economies don't work in a vacuum, which is why economists all over the world have different views and opinion on what the right course of action is. If there was one scientifically demonstrable better course of action in any situation, it would be the course taken. There are simply more factors involved than can ever be isolated in the real world economy, so economists extrapolate and interpret and come to conclusions. For every economist who thinks approach A is correct for a scenario, there's another one who thinks differently.

If over 5 to 10 years you can show two countries with very similar situations where one country took one approach and the other took a different approach, and you can clearly isolate and show that their approaches caused a significant measurable difference in result, then I'd take that as a good indication that in that particular situation a particular approach was better.

In fact, the exact opposite has happened. In the near future I believe you will see more and more governments jettison austerity measures as the failure that they are. France seems to be the first, followed by the UK in their next elections.
You could very well be right, the public generally falls for the politician that promises them everything they want with no price to pay. Someone has to pay for that additional government waste.
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
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If you mean the belief that spending should not outpace income? Correct, nothing will ever change my mind that logically spending can not outpace income forever. Simple math. If I've ever said that "austerity" is the right answer for every country in every situation, then please show me where I did. Obviously it's not the right tool at the right time for every situation, but the basic logic that spending should not outpace income in the long run is basic math and basic logic that applies to all entities.
And that has nothing to do with the current situation nor countries' response to it.

Economies don't work in a vacuum, which is why economists all over the world have different views and opinion on what the right course of action is. If there was one scientifically demonstrable better course of action in any situation, it would be the course taken. There are simply more factors involved than can ever be isolated in the real world economy, so economists extrapolate and interpret and come to conclusions. For every economist who thinks approach A is correct for a scenario, there's another one who thinks differently.

If over 5 to 10 years you can show two countries with very similar situations where one country took one approach and the other took a different approach, and you can clearly isolate and show that their approaches caused a significant measurable difference in result, then I'd take that as a good indication that in that particular situation a particular approach was better.
We are approaching the 5 year mark for this economic crisis.

You could very well be right, the public generally falls for the politician that promises them everything they want with no price to pay. Someone has to pay for that additional government waste.
It's just a simple recognition of policy failure. The austerians tried their ideology, it turned out to be wrong, so now we will try something else.
 

PokerGuy

Lifer
Jul 2, 2005
13,650
199
101
basically all economic evidence points to decreases in public sector spending as a major driving force in economic contraction.
Well duh, you stop pumping borrowed money into the economy and the falsely inflated economic figures start to reflect reality, which of course is less. Big shocker. Someone has to pay back that borrowed money though, plus interest. There simply is no getting around that mathematical fact: unless you use the borrowed money to invest in things that will provide a return greater than the cost of borrowing, it's a long term losing proposition.

I can certainly imagine there are specific times when borrowing makes sense, but the liberal notion that you can just always continue wasting with no consequences is crazy. Then when someone suggests actually spending responsibly instead of wasting, they cry "austerity!!".
Don't think I didn't catch your shift however.
No shift, I just pointed out that even in the article you linked it said the market saw the strength in the UK economy as reflected in the GBP. That confidence has the GBP climbing against the USD as well.
 

Fern

Elite Member
Super Moderator
Sep 30, 2003
26,907
173
106
This is truly bizarre self delusion. I am unaware of any credible source that interprets his statements in that way. Can you provide one? Not to mention the fact that this quote came from 2010, nearly 2 years ago, and things have become dramatically worse in that time. Even by your standard he was horribly wrong. There is no evidence whatsoever that he was attempting to state that austerity measures would lead to economic contraction for several years, followed by better expansion in the long term.




No, basically all economic evidence points to decreases in public sector spending as a major driving force in economic contraction. This really isn't open for debate. Furthermore, a number of these countries undertaking austerity measures were not poorly managed in the past. As I have already used as an example, Spain had a budget surplus and a debt/GDP ratio of ~26% before the crisis. That is not 'mismanagement' by any reasonable definition.

Don't think I didn't catch your shift however. Your original argument was that the UK being viewed as a better investment opportunity than continental Europe was due to austerity measures. When you were reminded that Europe was also undertaking these, you suddenly tried to shift to exchange rates. Sorry, that's not how it works.
I think this a most opportune time to employ the argument damn near worn-out by progressives:

"If he hadn't have done it things would be so much worse."

Not that I don't acknowledge that austerity measures won't boost GDP in the short-term, or at least I wouldn't expect them to. It's just the irony of the progressive argument that no matter how badly a Dem policy fails the response is - "it would have been worse without it!".

Why can't the other side use it too?

Fern
 

Fern

Elite Member
Super Moderator
Sep 30, 2003
26,907
173
106
Fiscal austerity and tight monetary policy, both things supported by Republicans, have failed where they were tried.
Too bad the British didn't opt for the Democratic plan like Greece did. Oh wait....

Fern
 

PokerGuy

Lifer
Jul 2, 2005
13,650
199
101
We are approaching the 5 year mark for this economic crisis.
And actual "austerity" hasn't even begun. You think as soon as the economic meltdown started countries reduced their spending in 5 minutes? Get real, austerity is just now starting to happen.

It's just a simple recognition of policy failure. The austerians tried their ideology, it turned out to be wrong, so now we will try something else.
Correlation =/= causation. I don't know if their policies were the right ones for their situation or not, but the default position of "spend more" is one that should always be viewed with tremendous skepticism, it's the easy way out to promise more free money for all.
 

senseamp

Lifer
Feb 5, 2006
35,060
5,144
126
Republicans want Americans to bet on Mitt Romney flip flopping on his austerity support once he gets into office. The problem is he might flip flop several times and end up back with austerity. We can't afford to play Romney Roulette with the American economy.
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
136
Well duh, you stop pumping borrowed money into the economy and the falsely inflated economic figures start to reflect reality, which of course is less. Big shocker. Someone has to pay back that borrowed money though, plus interest. There simply is no getting around that mathematical fact: unless you use the borrowed money to invest in things that will provide a return greater than the cost of borrowing, it's a long term losing proposition.

I can certainly imagine there are specific times when borrowing makes sense, but the liberal notion that you can just always continue wasting with no consequences is crazy. Then when someone suggests actually spending responsibly instead of wasting, they cry "austerity!!".
I'm glad to see you are coming around to the idea that expansionary austerity was a ridiculous fantasy. The confidence fairy neglected to make an appearance, and so contractionary fiscal policy led to an economic contraction. If you could let other conservatives know about this, I would appreciate it.

Secondly, your argument for what liberals think is a hilarious straw man and you know it. Don't make stupid arguments like that.

No shift, I just pointed out that even in the article you linked it said the market saw the strength in the UK economy as reflected in the GBP. That confidence has the GBP climbing against the USD as well.
You realize that in the last 12 months the GBP is actually down vs. the dollar, right?
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
136
And actual "austerity" hasn't even begun. You think as soon as the economic meltdown started countries reduced their spending in 5 minutes? Get real, austerity is just now starting to happen.
This is simply factually incorrect.

Correlation =/= causation. I don't know if their policies were the right ones for their situation or not, but the default position of "spend more" is one that should always be viewed with tremendous skepticism, it's the easy way out to promise more free money for all.
I'm glad you are at least appearing more open to jettisoning austerity in a depression.
 

5150Joker

Diamond Member
Feb 6, 2002
5,559
0
71
www.techinferno.com
Republicans want Americans to bet on Mitt Romney flip flopping on his austerity support once he gets into office. The problem is he might flip flop several times and end up back with austerity. We can't afford to play Romney Roulette with the American economy.
Maybe Mitt getting elected won't be so bad. He'll fuck up the economy so much more that America will finally wake up and realize that the overall GOP agenda is bad for middle class America (what's left of it) and good for the top 1% only.
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
136
I think this a most opportune time to employ the argument damn near worn-out by progressives:

"If he hadn't have done it things would be so much worse."

Not that I don't acknowledge that austerity measures won't boost GDP in the short-term, or at least I wouldn't expect them to. It's just the irony of the progressive argument that no matter how badly a Dem policy fails the response is - "it would have been worse without it!".

Why can't the other side use it too?

Fern
Because there is substantial economic evidence for the effect that the stimulus had on US GDP, and there is substantial evidence for the effects of austerity on UK/Eurozone GDP. The evidence so far shows that had there been even more austerity, the effects would have been even more catastrophic.

So basically you can't use that argument because it is factually wrong.
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
136
Too bad the British didn't opt for the Democratic plan like Greece did. Oh wait....

Fern
Speaking of tired arguments, how much longer are you going to keep pretending that the experience of Greece is generally applicable to the situation of other countries, or some sort of accurate representation of favored economic policy?

That's been shown to be ridiculous fantasy so many times, yet you continue to trot it out. Why?
 

Fern

Elite Member
Super Moderator
Sep 30, 2003
26,907
173
106
Because there is substantial economic evidence for the effect that the stimulus had on US GDP, and there is substantial evidence for the effects of austerity on UK/Eurozone GDP. The evidence so far shows that had there been even more austerity, the effects would have been even more catastrophic.

So basically you can't use that argument because it is factually wrong.
The liberties you take with the term "substantial" are obscene.

Fern
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
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The liberties you take with the term "substantial" are obscene.

Fern
Not as obscene as the liberties you take with evidence and logic. To attempt to equate the outcomes of fiscal stimulus and austerity as if the evidence would equally support an argument for the increase of each is laughable.
 

Fern

Elite Member
Super Moderator
Sep 30, 2003
26,907
173
106
Speaking of tired arguments, how much longer are you going to keep pretending that the experience of Greece is generally applicable to the situation of other countries, or some sort of accurate representation of favored economic policy?

That's been shown to be ridiculous fantasy so many times, yet you continue to trot it out. Why?
The fantasy is ignoring that Greece's policies are what you are espousing.

Greece has been 'stimulus mode' for quite a while. The results are 'awesome'.

You guys just can't recognize that location known as "between a rock and a hard place". When one is there your policies just don't work. Well, they do sort of wedge you deeper in.

Fern
 

Fern

Elite Member
Super Moderator
Sep 30, 2003
26,907
173
106
Not as obscene as the liberties you take with evidence and logic. To attempt to equate the outcomes of fiscal stimulus and austerity as if the evidence would equally support an argument for the increase of each is laughable.
Get reading glasses.

I've never attempted to equate stimulus with austerity.

Fern
 

woolfe9999

Diamond Member
Mar 28, 2005
7,164
0
0
The fantasy is ignoring that Greece's policies are what you are espousing.

Greece has been 'stimulus mode' for quite a while. The results are 'awesome'.

You guys just can't recognize that location known as "between a rock and a hard place". When one is there your policies just don't work. Well, they do sort of wedge you deeper in.

Fern
Greece is using stimulus rather than austerity? When did this happen? I thought they had undergone several rounds of significant austerity measures, the last being forced on them by the EU as a condition for the bailout. Am I misinformed?
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
136
Get reading glasses.

I've never attempted to equate stimulus with austerity.

Fern
You responded to a post about stimulus vs. austerity and asked why conservatives couldn't apply the same arguments to their policies as liberals do to theirs. I told you that it was because the evidence wouldn't support such a contention. I'm sorry if you don't like that, but such is life.
 

fskimospy

Elite Member
Mar 10, 2006
73,721
25,821
136
The fantasy is ignoring that Greece's policies are what you are espousing.

Greece has been 'stimulus mode' for quite a while. The results are 'awesome'.

You guys just can't recognize that location known as "between a rock and a hard place". When one is there your policies just don't work. Well, they do sort of wedge you deeper in.

Fern
Greece's policies are not what I am espousing. Even a cursory understanding of Keynesian economics would tell you that. How have you been involved in these discussions for this long and not even understand the basic terms under discussion?

In this post here you are either exposing a woeful ignorance of the basic arguments of the side you oppose, which should be quite embarrassing, or you are deliberately misrepresenting them because you feel like you can't win on the merits, which is both embarrassing and shitty. I really don't see another option.
 

BoberFett

Lifer
Oct 9, 1999
37,563
9
81
Spending money you don't have doesn't work. It looks like it works. There's a big difference. Getting a new credit card and buying a bunch of new furniture or taking out a loan to buy a new Mercedes makes you look affluent, but it didn't change your income, and eventually you have to pay the piper.
 

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