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Post by Neutral Guy on Feb 26, 2010 15:13:19 GMT -5
keynsian economics, the great ideas that led to the recession of the 1970s. If deficits mean nothing in a recession, according to the great Lord Keynes, then why not always have deficits even in good times? I don't hate anyone. I only hate certain ideas. Besides, Keynsianism seems to be one of the favorite forms of economics to neoconservatives. "We are all keynsians now" - Richard Nixon "deficits don't matter" - Dick Cheney (wasn't this what you said?) And guess who favored the stimulus?
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Post by Vene on Feb 26, 2010 15:20:17 GMT -5
A deficit doesn't matter in a recession because there are bigger problems to worry about, not that they universally don't matter. It's like if you're broke, you don't care about your debts because you need to eat, but when you have a steady income, you don't continue to build debt. Do you get this reading thing? I mean, first you misinterpret the graph, then you misinterpret my words.
And any economic system is going to have recessions, always. It HAPPENS, the only thing that can be done is to maximize growth and minimize the harm. Also, a little thing happened prior to the 1970s, it's called McCarthyism, and Keynesian economics was too close to Communism for the Red Scare. Instead, we've been going with social Darwinism with laissez-faire, just read the link in my signature.
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Post by Neutral Guy on Feb 26, 2010 15:32:46 GMT -5
I misinterpreted the graph first when I confused the change of unemployment for the actual unemployment rate itself. My previous posts acknowledge that I now see that graph for what it is.
But just because I did not arrive at the same conclusion as you have does not mean that I misinterpreted what you had said.
Not really the best analogy with debts. Yes, a broke person cares more about food, but they also do not go waste it on crap like expensive vacations or a multi thousand dollar speed boat, nor do they go to restaurants every night. That person, if he or she is sensible, will do everything possible to stretch that dollar as far as possible.
McCarthyism had nothing to do with economics or spending. It was all about a witchhunt of communists. Typically he went after people like movie stars. Lasted a few years in the 1950's. It all ended a long time before the 1970's recession. You might as well blame the 1970's recession on the success of "I Love Lucy".
Your biology essay is wrong, because it does not even start with the right facts. Reagan and Thatcher were mostly about rhetoric save for a few tax cuts here and there. Other than that, government intervention into the economy grew bigger and more interventionist during and after they were in office.
Just to let you know, you put words in my mouth when you directed me to that article. All I did was criticize the stimulus and jobs bill and a concept from economics.
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Post by Vene on Feb 26, 2010 15:43:34 GMT -5
Communism has nothing to do with economics?
I'm gonna head off to laugh now.
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Post by Neutral Guy on Feb 26, 2010 15:46:41 GMT -5
Yes, communism is all about economics. But the communists in McCarthy's time in the USA were extremely marginalized. Most people did not take them seriously. They had no real influence on public policy. McCarthy's hearings also did not have a great effect on public policy, especially not anything relating to economics.
The whole affair was little more than a big circus.
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Post by ltfred on Feb 26, 2010 16:05:28 GMT -5
Debt doesn't matter during recessionary periods. To understand why, you have to look at the causes of debt during a recession. For instance, the current recession reduced tax revenues by nearly one trillion dollars to the federal government, doubling deficit spending overnight. Fewer people were earning wages, so the fed took much less of it in taxation.
Therefore, you stimulate up the economy good, driving up employment and growth, and then driving up tax revenues.
In the long term- over 5 years, say- spending a lot of money now reduces, not increases, the debt. Obama's small stimulus bill actually cost money. A larger one would have saved more.
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Post by Neutral Guy on Feb 26, 2010 16:10:03 GMT -5
Correct me if I am wrong, but didn't Greenspan/Bernanke try stimuluses before the current recession, only for it to become a bubble based upon bad ideas, like the absurd idea that housing prices would keep going up, which people hedged their bets on?
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Post by ltfred on Feb 26, 2010 16:13:00 GMT -5
keynsian economics, the great ideas that led to the recession of the 1970s. No, that was actually a sudden drop-off in oil import, creating all kinds of shit. In Israel and other places, it caused hyper-inflation, which they successfully combated with price controls. Which are Keynesian. In the US, Carter was scared of inflation (for whatever reason), and didn't stimulate the economy to get employment up- the economy was never in recession during his reign. The first Reagen Recession, caused partly by the long-term oil war, but also by his bullshit policy, was beaten with near 0% interest rates which are- OH LOOK- Keynesian. Because 'Good Times' and 'Recession' are different.
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Post by ltfred on Feb 26, 2010 16:14:22 GMT -5
Correct me if I am wrong, but didn't Greenspan/Bernanke try stimuluses before the current recession, only for it to become a bubble based upon bad ideas, like the absurd idea that housing prices would keep going up, which people hedged their bets on? No.
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Post by Neutral Guy on Feb 26, 2010 16:27:10 GMT -5
keynsian economics, the great ideas that led to the recession of the 1970s. No, that was actually a sudden drop-off in oil import, creating all kinds of shit. In Israel and other places, it caused hyper-inflation, which they successfully combated with price controls. Which are Keynesian. In the US, Carter was scared of inflation (for whatever reason), and didn't stimulate the economy to get employment up- the economy was never in recession during his reign. The first Reagen Recession, caused partly by the long-term oil war, but also by his bullshit policy, was beaten with near 0% interest rates which are- OH LOOK- Keynesian. Because 'Good Times' and 'Recession' are different. Nixon had plenty of price controls, but things for some reason did not sail so smooth here. Carter afraid of inflation? That's like saying a fat kid is scared of cake. During the 1970s, you had inflation rates far above than prior years, even more so than the good times of the 1950s and 1960s. Anyone who knows anything about the 1970s is familiar with a term called "Stagflation" The inflation rate, by the way, is not actually set by the president. It is set by the Federal Reserve. Reagan had Paul Volker appointed as federal reserve chairman. He radically decreased inflation. Reagan decreased taxes. Yet, somehow, the economy made it past the recession which really ended in 82. To be fair, Reagan did greatly increase government spending.
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Post by ltfred on Feb 26, 2010 16:40:56 GMT -5
Carter afraid of inflation? That's like saying a fat kid is scared of cake. During the 1970s, you had inflation rates far above than prior years, even more so than the good times of the 1950s and 1960s. Anyone who knows anything about the 1970s is familiar with a term called "Stagflation" Carter's fed tried to combat inflation. He appointed Volker to do that, by raising interest rates. And it was successful. But it also raised unemployment, crashed growth and caused a recession. Oh well. At least the important number was down, right? Carter should have known, like Reagen, that inflation doesn't matter. Reagen ended the recession by dropping the interest rate like a stone.
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Post by Vene on Feb 26, 2010 16:53:07 GMT -5
Inflation does have some importance, it means a lot in places like Zimbabwe, for example.
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Post by Neutral Guy on Feb 26, 2010 17:02:49 GMT -5
You are wrong about inflation during the time of the 2 presidents. But you were right about who appointed Volker. I was not. Carter was President from 1977 until 1981. Reagan was President from 1981 until 1989. Lets take a look at the inflation rate charts: source: inflationdata.com/inflation/Inflation_Rate/HistoricalInflation.aspx?dsInflation_currentPage=1Also take note of the fact that 1980 had some of the highest inflation here, which was during carters term. Don't get me wrong. I really do not favor Reagan over Carter. Reagan broke his promises over the national debt, he endlessly fed the war machine when the Soviet Union was falling apart, he amplified the war on drugs to absurd levels, he made deals with right wing dictators, he pandered to the religious right, etc. You are entitled to believe that inflation is meaningless, but when you actually buy things for yourself, you might change your opinion when all of a sudden the milk is more expensive.
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Post by Vene on Feb 26, 2010 17:50:14 GMT -5
Inflation by itself is not as meaningful of a number as inflation compared to the change in the average wage. Unfortunately, I don't have those statistics. If wages are increasing at a rate higher than inflation, meh.
Also, to be completely fair, average household wage, that way we're not just looking at those who have gainful employment, but those who are underemployed and unemployed.
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Post by Amaranth on Feb 26, 2010 18:19:06 GMT -5
This country has had serveral recessions before. Always came back. And thankfully, always will. America will thrive and prosper forever. ...I think my tongue is actually stuck in my cheek now.
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