FDR vs JFK |
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thellama73
Collaborator Honorary Collaborator Joined: May 29 2006 Location: United States Status: Offline Points: 8368 |
Posted: November 12 2012 at 22:45 | |||
Anyway, I am not arguing that every dime taxed or borrowed would be spent wisely elsewhere. I am arguing that, since taxation reduces how much money people have to spend, they will on average spend less than they would in the absence of taxation. And I am arguing that some of the money that goes towards government bonds would go towards other useful things, not all of it. I don't see how anyone could disagree with those points.
This means that it is impossible to increase government spending in a vacuum with affecting consumption, investment and exports. This means that an increase in government spending will have a smaller affect on GDP than that equation would lead you to believe, but they never tell you that in economics classes, which I think is terrible. Personally, I am skeptical that this effect is positive at all, because i believe that markets allocated resources more efficiently than governments, but even if I am wrong, then the amount of government spending would need to be vastly greater than what is typically proposed to correct for contractions in the economy. Raising that amount of money through either borrowing or taxation is problematic, however, as people only have so much that you can tax and there is only so much you can borrow before interest rates go up and you face. I just think it's a very meddlesome and inefficient solution to a problem that will correct itself more quickly if left alone. |
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smartpatrol
Forum Senior Member Joined: April 15 2012 Location: My Bedroom Status: Offline Points: 14169 |
Posted: November 12 2012 at 23:43 | |||
Oh my God, what did I start?
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King of Loss
Prog Reviewer Joined: April 21 2005 Location: Boston, MA Status: Offline Points: 16328 |
Posted: November 12 2012 at 23:54 | |||
FDR, cause he conquered most of Western Europe and Japan, the two other competitors to the US industrial base at that time and ushered a long time of US dominance throughout the world.
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Triceratopsoil
Forum Senior Member Joined: April 03 2010 Location: Canada Status: Offline Points: 17995 |
Posted: November 13 2012 at 00:00 | |||
Bush jr? Edited by Triceratopsoil - November 13 2012 at 03:03 |
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Atavachron
Special Collaborator Honorary Collaborator Joined: September 30 2006 Location: Pearland Status: Offline Points: 64338 |
Posted: November 13 2012 at 00:43 | |||
^ Hear, hear
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Epignosis
Special Collaborator Honorary Collaborator Joined: December 30 2007 Location: Raeford, NC Status: Offline Points: 32476 |
Posted: November 13 2012 at 06:07 | |||
Let's not forget the underlying assumption that government spending is somehow more effectual or efficient than any other spending. Briefly, it is not, mainly because it is easy to be a poor steward of other people's money. |
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thellama73
Collaborator Honorary Collaborator Joined: May 29 2006 Location: United States Status: Offline Points: 8368 |
Posted: November 13 2012 at 07:20 | |||
You should know better than to even mention anything remotely political around here, unless you want long, libertarian diatribes hurled at you. |
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HarbouringTheSoul
Forum Senior Member Joined: May 21 2010 Status: Offline Points: 1199 |
Posted: November 13 2012 at 07:25 | |||
I don't. That should be obvious. The question is: What about the money that otherwise wouldn't be efficiently spend? If I'm not mistaken, Keynesian economics argue that in certain situations decisions that make sense on an individual level can hurt the overall economy. The idea then is that the government, because it operates at a macro-economic level, can identify these problems and correct them through purposeful spending. I don't believe that Keynesians would advocate increased government spending in just about any situation. Only when the free market is unable to reach equilibrium on its own. And again, if I'm not mistaken, critics of Keynesian economics disagree that such a situation exists.
Well, let's blame awful economics classes then. I vaguely remember reading critical thoughts on both FDR and Keynesian economics in school, but our teacher was utterly unable to comprehend anything about economics beyond the most basic ideas, so this kind of fell by the wayside. As did many other things. Economics was the only class I ever had where I had a better understanding of the subject than my teacher despite knowing virtually nothing.
Wasn't the whole idea of Keynesian economics born out of a situation where the Great Depression stubbornly refused to fix itself, despite what all economists at the time believed?
Wait a minute. If the government collects a person's money through taxes, it stops being his money and becomes the government's money. The government isn't a steward of anybody else's money. The idea is that sometimes macro-economic decisions can be more effective than micro-economic ones. Thus, the government should collect money that would otherwise be misallocated and spend it where it makes sense. Whether or not that works is up for debate. |
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thellama73
Collaborator Honorary Collaborator Joined: May 29 2006 Location: United States Status: Offline Points: 8368 |
Posted: November 13 2012 at 07:36 | |||
No one disputes that market failures such as externalities exist. Not even the most die hard Austrian school economist disputes that. We just think that the solution is worse than the original problem.
No not really. Hoover started efforts to "fix" the economy pretty much right from the get go, and FDR expanded them. The recession of 1920, which was extremely deep, snapped back without intervention in a year and a half.
The point is that the people who make the decisions about how the money is spent do not get to personally keep what is left over, as you do with your own paycheck, so there is no incentive for them to be careful with it. |
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HarbouringTheSoul
Forum Senior Member Joined: May 21 2010 Status: Offline Points: 1199 |
Posted: November 13 2012 at 15:32 | |||
Why? I understand if you're skeptical about its effectiveness, but the idea that it makes things worse seems to be quite odd to me. The principle seems quite plausible: The government identifies a market failure and allocates it own spending to help fix it. Unless the government fails to do that the correctly, I see no reason why this should make the situation worse.
I guess I have some reading up to do on that matter. But I'm skeptical about the idea that because one recession snapped back quickly, another would have done the same. If there's anything I've learned about economics, it's that it's a complex and fairly unpredictable field. One recession isn't necessarily like the other.
Politicians are paid for making these decisions, and the effects that their decisions have on the economy strongly influence whether or not they get re-elected. Isn't that incentive enough to be careful? I find it absurd that a politician would think "Oh well, nothing's at stake for me here so I might as well just do as I please". |
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Epignosis
Special Collaborator Honorary Collaborator Joined: December 30 2007 Location: Raeford, NC Status: Offline Points: 32476 |
Posted: November 13 2012 at 16:26 | |||
No voter I've ever spoken with says, "I am voting to reelect X because he is a competent steward of our resources." When a large segment of the voting population is receiving benefits from the government but not investing in it, they generally do not care how much of other people's money is wasted or squandered as long as their own benefits (or the benefits of those they know) are not being reduced. In 2010, federal programs wasted $125 billion. |
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Guldbamsen
Special Collaborator Retired Admin Joined: January 22 2009 Location: Magic Theatre Status: Offline Points: 23098 |
Posted: November 13 2012 at 16:30 | |||
Political Archives: The Ultimate Circus For Adults Source
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“The Guide says there is an art to flying or rather a knack. The knack lies in learning how to throw yourself at the ground and miss.”
- Douglas Adams |
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thellama73
Collaborator Honorary Collaborator Joined: May 29 2006 Location: United States Status: Offline Points: 8368 |
Posted: November 13 2012 at 16:34 | |||
As you rightly point out, the economy is a very complex thing. I think it takes great hubris to assume that a few people can know what is best for a system that involves millions of individual decisions a day. The nature of government is that it works very slowly. By the time it identifies a problem, agrees on a solution, and implements it, conditions will have changed to such an extent that the impact will be at best unpredictable. I just don't think members of government are nimble or wise enough to be able to do these things. You are right that the theory is correct, but in practice it is too delicate an operation for so large and clumsy an institution. In theory you could throw a die so as to get the same number every time, but the amount of control required is beyond our capabilities.
No, they don't think like that, you're right. It's more subtle than that. They are just not as careful to find the best use of the money. Think about when a company pays for your business trip. Do you spend days researching the cheapest flights and the best hotel bargains, or do you just take something easy and fast because it's not your money anyway? Sure, it's important that your company not waste money so that it does well and you can keep your job, but on an individual level, you cut corners because every penny is not coming out of your personal pocket. |
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thellama73
Collaborator Honorary Collaborator Joined: May 29 2006 Location: United States Status: Offline Points: 8368 |
Posted: November 13 2012 at 16:38 | |||
And I'm skeptical that it wouldn't have done the same. You're operating from the null hypothesis that it is both necessary and possible for government's to correct economic fluctuations. To me, this is a positive statement that needs proof. I have never seen anything to indicate that this is in fact the case. We have had deep recessions that have snapped back quickly with no government intervention. We have never had a deep recession that snapped back quickly with lots of government intervention. Why do I have to prove my viewpoint? Shouldn't you have to prove yours? |
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stonebeard
Forum Senior Member Joined: May 27 2005 Location: NE Indiana Status: Offline Points: 28057 |
Posted: November 14 2012 at 10:57 | |||
There's a Newsweek special edition out now (went into Barnes and Noble because I had time to kill) about the greatest presidents. I don't know If I can remember them all, but there were ten. Among them:
FDR Teddy JFK Lyndon Johnson Ronald Reagan Barack Obama Bill Clinton Woodrow Wilson Maybe it was about "modern" presidents, because hey lopsided. Anyway, I thought of all you guys.
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thellama73
Collaborator Honorary Collaborator Joined: May 29 2006 Location: United States Status: Offline Points: 8368 |
Posted: November 14 2012 at 10:59 | |||
There's a tendency to equate "great" with "accomplished." Those presidents all certainly accomplished a lot (except for Bill Clinton) but are all accomplishments necessarily good? My favorite presidents were all good stewards who didn't do too much to screw things up. Edited by thellama73 - November 14 2012 at 11:00 |
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The Dark Elf
Forum Senior Member VIP Member Joined: February 01 2011 Location: Michigan Status: Online Points: 12657 |
Posted: December 10 2012 at 21:21 | |||
I'll vote for FDR. Since the mere mention of his name sends current Republicans into paroxysms of neo-con rabidity, it is obvious he served the country well. I regard him highly.
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...a vigorous circular motion hitherto unknown to the people of this area, but destined
to take the place of the mud shark in your mythology... |
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Epignosis
Special Collaborator Honorary Collaborator Joined: December 30 2007 Location: Raeford, NC Status: Offline Points: 32476 |
Posted: December 10 2012 at 21:28 | |||
Feel better, bro? |
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The Dark Elf
Forum Senior Member VIP Member Joined: February 01 2011 Location: Michigan Status: Online Points: 12657 |
Posted: December 10 2012 at 21:57 | |||
Never felt bad in the first place. How about you? |
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...a vigorous circular motion hitherto unknown to the people of this area, but destined
to take the place of the mud shark in your mythology... |
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thellama73
Collaborator Honorary Collaborator Joined: May 29 2006 Location: United States Status: Offline Points: 8368 |
Posted: December 10 2012 at 22:27 | |||
Why do liberals hurl the word neo-con around as an insult? Neo-cons are closer to Democrats in ideology than classical conservatives. Furthermore, I don't know anyone on this board who is a neo-con or espouses neo-con principles. Could it be that they don't know what words mean? |
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