|
Korean Job Discussion Forums
"The Internet's Meeting Place for ESL/EFL Teachers from Around the World!"
|
| View previous topic :: View next topic |
| Author |
Message |
blade
Joined: 30 Jun 2007
|
 Posted: Sat Jun 19, 2010 7:14 pm Post subject: Deficit terrorists |
 |
|
Great article.
| Quote: |
Deficit Terrorists Strike in the United Kingdom: United States of America Next?
Last week, Britain's new government said it would abandon the previous government's stimulus program and introduce the austerity measures required to pay down its estimated $1 trillion in debts. That means cutting public spending, laying off workers, reducing consumption, and increasing unemployment and bankruptcies. It also means shrinking the money supply, since virtually all "money" today originates as loans or debt. Reducing the outstanding debt will reduce the amount of money available to pay workers and buy goods, precipitating depression and further more economic pain.
The financial sector has sometimes been accused of shrinking the money supply intentionally, in order to increase the demand for its own products. Bankers are in the debt business, and if governments are allowed to create enough money to keep themselves and their constituents out of debt, lenders will be out of business. The central banks charged with maintaining the banking business therefore insist on a "stable currency" at all costs, even if it means slashing services, laying off workers, and soaring debt and interest burdens. For the financial business to continue to boom, governments must not be allowed to create money themselves, either by printing it outright or by borrowing it into existence from their own government-owned banks.
Today this financial goal has largely been achieved. In most countries, 95% or more of the money supply is created by banks as loans (or "credit"). The small portion issued by the government is usually created just to replace lost or worn out bills or coins, not to fund new government programs. Early in the twentieth century, about 30% of the British currency was issued by the government as pounds sterling or coins, versus only about 3% today. In the U.S., only coins are now issued by the government. Dollar bills (Federal Reserve Notes) are issued by the Federal Reserve, which is privately owned by a consortium of banks.
http://www.huffingtonpost.com/ellen-brown/deficit-terrorists-strike_b_615813.html?view=print
|
|
|
| Back to top |
|
 |
blade
Joined: 30 Jun 2007
|
| Posted: Sat Jun 19, 2010 7:33 pm Post subject: |
|
|
John Maynard Keynes: The forgotten man
"Super asininity" triumphs again: The great British economist's 15 minutes of 21st century fame are over, already
How could it only have been last September when I wrote, in the context of a review of Lord Robert Skidelsky's "Keynes: The Return of the Master", that "the sudden present-day prominence of John Maynard Keynes... calls to mind the famous 1981 Rolling Stone magazine cover story on the Doors' Jim Morrison: 'He's Hot, He's Sexy, and He's Dead.'"
Pop celebrity is just so fleeting in the 21st century. Here we are, just nine months later, and the great British economist is once again ice-cold, devoid of sex appeal, and, yes, still dead. None other than Skidelsky himself points this out in a must-read essay in today's Financial Times," "the re-conversion to Keynes," he writes, "in the wake of the financial collapse of 2008 was only skin-deep."
The particulars of Skidelsky's argument will be familiar to anyone who has been following the debate over whether it makes sense to cut government spending when faced with high unemployment, excess unused industrial capacity, a complete absence of inflation, and the very real threat of a recessionary relapse. Skidelsky's charm lies in his evocation of a similar debate that played out in Great Britain in the 1930s, when the fiscal austerity advocates triumphed, and helped plunge the world into Depression. At the time Keynes was a vocal, and lonely critic of the prevailing wisdom. He was also, as usual, right, but in his own inimitable style.
When the Conservative-Liberal coalition that had succeeded the Labour government introduced an emergency budget in September 1931, Keynes again stood out against the chorus of approval. The budget was, he wrote, "replete with folly and injustice". He explained to an American correspondent that "every person in this country of super-asinine propensities, everyone who hates social progress and loves deflation, feels that his hour has come and triumphantly announces how, by refraining from every form of economic activity, we can all become prosperous again."
Maybe he's not dead after all! Because the phrase "this country of super asinine propensities" certainly sounds as if it only could have been uttered by someone with a front row seat watching the U.S. Senate deliberate in the summer of 2010.
http://www.salon.com/news/economics/index.html?story=/tech/htww/2010/06/17/keynes_the_forgotten_man |
|
| Back to top |
|
|
chellovek
Joined: 29 Feb 2008
|
| Posted: Sat Jun 19, 2010 9:34 pm Post subject: |
|
|
You keep on walkin', boy. This is libertarian country.
Also, interesting article. |
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
| Posted: Sat Jun 19, 2010 10:56 pm Post subject: |
|
|
Whenever govts introduce austerity measures, the economy improves.
The second article you posted was completely retarded.
| Quote: |
| ....when the fiscal austerity advocates triumphed, and helped plunge the world into Depression. |
When did this happen? It's a complete counter factual. There was a recession in 1921. Harding did nothing then the 20s happened. Come 1929 Hoover increased spending during a recession which turned 8-10% unemployment (the same level as 1921), into consistent double digit joblessness for an entire decade!
The exact same thing is happening now. Keynes? Give me a break. |
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
| Posted: Sat Jun 19, 2010 11:05 pm Post subject: |
|
|
This is from the comments of the retarded Salon article. It tells you all you need to know about Keynes.
| Quote: |
There is no basis for the claim that "austerity" prolongs depressions - it is the cure
There is no basis in fact, logic or history for Keynesian theories or policies. There is no factual, logical or historical basis for the idea that depressions are caused by and/or prolonged due to �austerity�.
Robert P. Murphy shows that Hoover wasn�t a tight fisted liquidationist here:
�In the first full year in which Hoover and Congress would have realized the country was in serious trouble, they boosted federal spending by a whopping 31 percent (from FY 1931 to FY 1932), and this occurred while tax receipts collapsed by 39 percent! Are these facts consistent with the picture of Hoover as a tight-fisted liquidationist that some modern Keynesians are painting?
In any event, Hoover's last fiscal year was FY 1933, which ran from July 1, 1932, to June 30, 1933. (Roosevelt was sworn in on March 4, 1933.) Unemployment in 1933 averaged 25 percent. But, as Romer told us in the block quotation above, the unemployment rate fell rapidly once Roosevelt took over and cranked up the spending.
Yet look at the relatively insignificant increase in deficits. In the rock-bottom FY 1933, the deficit was 4.5 percent of GDP. In the first three years of the New Deal � when Romer says the economy illustrated the success of (modest) Keynesianism � the deficit averaged 5.1 percent of GDP.�
http://mises.org/daily/3534
Further, the 1920 depression had been cured quickly with high interest rates, the slashing of government spending and the slashing of tax rates. Tom Woods explains here:
http://www.youtube.com/watch?v=czcUmnsprQI
Finally, Murphy notes that the post-WWII recession was ended quickly with a slashing of the deficit:
�[G]overnment spending and the deficit absolutely collapsed at the end of World War II, and yet the economy adjusted fairly quickly. Specifically, in FY 1945 the deficit was 21.5 percent of GDP. Yet two years later, the budget surplus was 1.7 percent of GDP!
Since a sixty-basis-point swing (over one year) meant such a big difference between Hoover and Roosevelt, one would think that the 2,320-basis-point swing (over two years) would make a much bigger difference between the economies under Roosevelt and Truman. Yet the postwar recession lasted a mere eight months, and the official unemployment rate for (calendar year) 1946 was � get ready � a whopping 3.9 percent.�
Thankfully, NO ONE in the real world seems to be listening to the Keynesian Hoaxers anymore. If there is justice in the world, they will be rightly blamed for our current economic mess and we will be done with them forever.
|
|
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
| Posted: Sat Jun 19, 2010 11:42 pm Post subject: |
|
|
And finally, the root cause of most of our problems.
http://mises.org/daily/4511
| Quote: |
As with all government plans, Bretton Woods was dealing with symptoms rather than causes and treating those symptoms in a way that enables and even encourages the disease. It pegged currencies at unrealistic levels, provided a bailout mechanism for governments and banking establishments to continue to do what they should not be doing, and thereby prolonged the problems and made them worse in the long run.
Governments have been throwing our good money after bad for a very long time. The plan, just as with the latest round of bailouts in the United States or Europe, was to dump money on near-bankrupt countries and thereby encourage them to continue with the very policies and practices that created the problem to begin with. |
I especially enjoyed the bolded part. |
|
| Back to top |
|
|
blade
Joined: 30 Jun 2007
|
| Posted: Sat Jun 19, 2010 11:49 pm Post subject: |
|
|
| Senior wrote: |
Whenever govts introduce austerity measures, the economy improves.
|
So, by this logic the 1980s should have a golden age for South American countries.
Never mind the reality, continue to blame all of man's problems on socialism.
Anyway the point of the OP was point out economic growth isn't failing because of government stimuluses but because the wrong people i.e. banking industry has been allowed to drag everyone down with it.
My own countries economy would be well on the way to recovery at this stage if the main banks were allowed fail and money used to bail them out was used to kick start the economy. This could have been done for a fraction of the cost. |
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
| Posted: Sun Jun 20, 2010 12:02 am Post subject: |
|
|
| Quote: |
[quote="blade"]
| Senior wrote: |
Whenever govts introduce austerity measures, the economy improves.
|
So, by this logic the 1980s should have a golden age for South American countries.
Never mind the reality, continue to blame all of man's problems on socialism. |
Chile, especially, is strong now because they took these measures early on. There was a quite severe recession in the 80s where most govts cut spending (NZ is actually a good example) and had very strong economic growth through out the 90s.
| Quote: |
Anyway the point of the OP was point out economic growth isn't failing because of government stimuluses but because the wrong people i.e. banking industry has been allowed to drag everyone down with it.
My own countries economy would be well on the way to recovery at this stage if the main banks were allowed fail and money used to bail them out was used to kick start the economy. This could have been done for a fraction of the cost. |
I 100% agree with you, except for the "kick start the economy" part. You are completely right in your analysis that corporate SOCIALISM at the end of the last decade caused the problems we have in the new one. |
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
| Posted: Sun Jun 20, 2010 12:03 am Post subject: |
|
|
| blade wrote: |
| Senior wrote: |
Whenever govts introduce austerity measures, the economy improves.
|
So, by this logic the 1980s should have a golden age for South American countries.
Never mind the reality, continue to blame all of man's problems on socialism. |
So by your logic Japan shouldn't have had stagnant growth for 20 years? And one of the largest debt to GDP ratios on the planet? |
|
| Back to top |
|
|
blade
Joined: 30 Jun 2007
|
| Posted: Sun Jun 20, 2010 12:08 am Post subject: |
|
|
| Senior wrote: |
| blade wrote: |
| Senior wrote: |
Whenever govts introduce austerity measures, the economy improves.
|
So, by this logic the 1980s should have a golden age for South American countries.
Never mind the reality, continue to blame all of man's problems on socialism. |
So by your logic Japan shouldn't have had stagnant growth for 20 years? And one of the largest debt to GDP ratios on the planet? |
No, Japan too bailed out it's failing banks. Also when you add in private debt, Japan isn't really that much more indebted than most Western economies. |
|
| Back to top |
|
|
blade
Joined: 30 Jun 2007
|
| Posted: Sun Jun 20, 2010 12:13 am Post subject: |
|
|
[quote="Senior"]
| Quote: |
| blade wrote: |
| Senior wrote: |
Whenever govts introduce austerity measures, the economy improves.
|
So, by this logic the 1980s should have a golden age for South American countries.
Never mind the reality, continue to blame all of man's problems on socialism. |
Chile, especially, is strong now because they took these measures early on. There was a quite severe recession in the 80s where most govts cut spending (NZ is actually a good example) and had very strong economic growth through out the 90s.
| Quote: |
Anyway the point of the OP was point out economic growth isn't failing because of government stimuluses but because the wrong people i.e. banking industry has been allowed to drag everyone down with it.
My own countries economy would be well on the way to recovery at this stage if the main banks were allowed fail and money used to bail them out was used to kick start the economy. This could have been done for a fraction of the cost. |
I 100% agree with you, except for the "kick start the economy" part. You are completely right in your analysis that corporate SOCIALISM at the end of the last decade caused the problems we have in the new one. |
Why not? EU structural funds helped start Ireland's economy in the early 1990s. Also if things such bridges, roads, water treatment plants are built they will most likely benefit any economy in the long run. These things are even more needed when the private sector isn't in a position to fund them. |
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
| Posted: Sun Jun 20, 2010 12:15 am Post subject: |
|
|
| blade wrote: |
| Senior wrote: |
| blade wrote: |
| Senior wrote: |
Whenever govts introduce austerity measures, the economy improves.
|
So, by this logic the 1980s should have a golden age for South American countries.
Never mind the reality, continue to blame all of man's problems on socialism. |
So by your logic Japan shouldn't have had stagnant growth for 20 years? And one of the largest debt to GDP ratios on the planet? |
No, Japan too bailed out it's failing banks. Also when you add in private debt, Japan isn't really that much more indebted than most Western economies. |
Don't you see the inconsistency between the tone of the articles you posted and what you are actually saying? Keynes, likely, would have bailed out the banks.
Except for the articles you posted, we are pretty much in agreement. Giving out piles of cash to criminals is utterly disgusting. |
|
| Back to top |
|
|
Senior
Joined: 31 Jan 2010
|
| Posted: Sun Jun 20, 2010 12:21 am Post subject: |
|
|
[quote="blade"]
| Senior wrote: |
| Quote: |
| blade wrote: |
| Senior wrote: |
Whenever govts introduce austerity measures, the economy improves.
|
So, by this logic the 1980s should have a golden age for South American countries.
Never mind the reality, continue to blame all of man's problems on socialism. |
Chile, especially, is strong now because they took these measures early on. There was a quite severe recession in the 80s where most govts cut spending (NZ is actually a good example) and had very strong economic growth through out the 90s.
| Quote: |
Anyway the point of the OP was point out economic growth isn't failing because of government stimuluses but because the wrong people i.e. banking industry has been allowed to drag everyone down with it.
My own countries economy would be well on the way to recovery at this stage if the main banks were allowed fail and money used to bail them out was used to kick start the economy. This could have been done for a fraction of the cost. |
I 100% agree with you, except for the "kick start the economy" part. You are completely right in your analysis that corporate SOCIALISM at the end of the last decade caused the problems we have in the new one. |
Why not? EU structural funds helped start Ireland's economy in the early 1990s. Also if things such bridges, roads, water treatment plants are built they will most likely benefit any economy in the long run. These things are even more needed when the private sector isn't in a position to fund them. |
Ireland's economic growth over the passed two decades was based on bubble economics. They are just a lesser version of Iceland. They are paying the price now.
Govt spending crowds out REAL investment. I agree that bridges, roads, water treatment etc are good things, but what about the stuff we went without in order to build those things?
Besides, roads and bridges (ie cars) are supposedly polluting the environment. Is it really a good thing for the govt to facilitate pollution? Perhaps private entities would have come up with an alternative if they were allowed to use capital as they saw fit (I'm not saying this would definitely happen, but it is more likely than a govt bureaucrat coming up with a solution for the first time in history). |
|
| Back to top |
|
|
|
|
You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum
|
|
FAQ
Search
Memberlist
Usergroups
Register
Profile
Log in to check your private messages
Log in
