I listened to be anti-Krugman bit.

I’m a little unconcerned because if the Europeans want to dilly dally and do nothing, they will suffer the consequences more than anybody else.

Life is all about short term measures that affect long run performance. A long term plan is helpful, but you need to calibrate as you go, based on the conditions on the ground.

Telling a sick person that he should’ve led a clean life all along is not going to cure him. Sure he deserves a good scolding but he needs intervention so that he may live to fight another day.

[quote=SK in CV] I’m not a particular fan of Krugman’s tactics. Too ideological. A bit dismissive of the tiniest bit of evidence countering his arguments.
[/quote]

I’m a fan of Krugman’s tactics. Some people need to be smacked back in their places.

[quote=SK in CV]
But his larger view of the european economy over the last 4 years has been spot on, and results have been as he predicted.
[/quote]

Exactly. He told them so. And he’s been right.

I’m happy to see a compare and contrast between America and Europe. Europe is cutting spending just like Republicans want to do here, and they are going back into recession. Let’s look back in 10 years and see where European standards of living stand compared to ours.

[quote=SK in CV]
Nor did I see any destruction in this debate. Two varied approaches to economics. One pretty conventional. One a joke.[/quote]

That Spanish guy was just rambling on.
He talked about the cause of the crisis but he didn’t provide any prescriptions for fixing the Euro.

[quote=livinincali]

I’ve yet to see one successful example of a person, corporation or country spending it’s way out of debt successfully. It always ends in a hyper inflationary money printing or a deflationary depression, but it’s different this time. Krugman’s got it all figured out.[/quote]

I have no idea whether there are examples or not of people, or corporations, or countries spending their way out of debt. I do know that individuals spending and individual corporatations spending, doesn’t lead to inflation. But whether there are examples or not isn’t really material as related to Keynsian economics. It’s not a tenet of Keynsian ecomonics. Not even close.

[quote=Hobie]Sure it does. It depends on where the money to spend originates. Private or public sector.

Keyes believes govt spending, ‘primes the pump’ by increasing the money supply. When it doesn’t work that is when hyper inflation begins. As Livincali cites.

If the same spending is by the private sector ie. banks lending or spending savings then you are correct with respect to inflation.

The bigger picture is not so much the academic definitions but it the general ‘mood’ of the country. If folks and business feel confident and secure they spend and take risks. When there is doubt, as there is now, people hang on to their money and business hunkers down until they feel the tide has turned.[/quote]

You’re closer to correct, but that’s not what I was responding to. He said spending to get out of debt. Keynes suggested just the opposite. There’s a big difference between getting out of debt and getting out of a recession. Keynesian ecomomics would lead to cutting spending, increasing taxes and deleveraging in times of economic growth.

[quote=livinincali]Got to love the Keynesian argument. If your stimulus efforts don’t produce the desired growth effects you can always say it would have worked if there was more stimulus. You can fail over and over increasing debt faster than GDP and claim there just needs to be more stimulus to produce growth.

I’ve yet to see one successful example of a person, corporation or country spending it’s way out of debt successfully. It always ends in a hyper inflationary money printing or a deflationary depression, but it’s different this time. Krugman’s got it all figured out.[/quote]
To be a true Keynesian you have to raise taxes and decrease spending in economic good times in order to save for a rainy day. George W. Bush’s administration failed to do so; they cut taxes and increased spending during the economic boom he presided over. Even most of Reagan’s economic team were Keynesians. That’s exactly *WHY* Saint Ronald raised taxes later in his administration.

The trouble is, what’s rational and correct is rarely politically popular. People want low taxes and high government services. So we’re often stuck with a stupid compromise where the government overspends while under taxing.

Poorgrad: Right on. The old cake and eat it too analogy. People are used to free cake.

I never liked Krugman’s policies. Bill Maher has him on all the time and he always has the same thing to say but then again it seem like all economist espouse the same thing over and over if you listen long enough.

That being I respect him becuase even though I think his policies are flawed his heart is in the right place. He just wants to see america where people have a chance.

Maybe Krugman and CAR are the same person?

😛

CE