R.I.P. UK

[Arraya]

[quote=Allan from Fallbrook]

Arraya: Good article from Socialist Appeal (UK) on “Does Keynesianism Work?”: http://www.socialist.net/keynesianism.htm

Oblique references to Marx’s theorizing on dialectical materialism, but overall a very balanced article, with its focus on UK policies dating back to the 1930s and their effects, both good and bad.

[/quote]

Very good critique of Keynesianism from a left perspective.

It appears officialdom is backed into a Keynesianism corner at this point. It’s print and take on more debt or fall into a deflationary spiral, IMO. Much like the oft-cited analogy of a drug addict at the end of a binge frantically seeking more and more drugs to get the same high.

It seems like it’s almost time to go into detox. What that will look like is a good question.

[Allan from Fallbrook]

[quote=Arraya]
It seems like it’s almost time to go into detox. What that will look like is a good question.[/quote]

Arraya: I think we all know what that will look like, which is why the American and EU governments have been avoiding it like the plague.

There isn’t a politician out there that wants to bell that particular cat, because, when they do, all hell is going to break loose.

We’re already seeing the reaction of the frugal and careful Germans to Greek excesses; just wait until Spain, Portugal and Italy come unglued. There is a massive unfunded pension overhang in most of the major Eurozone countries, births are below replacement rate and government debt/spending are completely out of whack.

That Minyanville/Das article did a good job of not encapsulating the entire Greek and EU problem, but drew excellent parallels to the very same problems here in the US. Problems we’re doing our level best to “spend” away. As much whip as Uncle Sam might have, at some point its going to overwhelm us, too.

[Allan from Fallbrook]

[quote=Arraya]
It seems like it’s almost time to go into detox. What that will look like is a good question.[/quote]

Arraya: I think we all know what that will look like, which is why the American and EU governments have been avoiding it like the plague.

There isn’t a politician out there that wants to bell that particular cat, because, when they do, all hell is going to break loose.

We’re already seeing the reaction of the frugal and careful Germans to Greek excesses; just wait until Spain, Portugal and Italy come unglued. There is a massive unfunded pension overhang in most of the major Eurozone countries, births are below replacement rate and government debt/spending are completely out of whack.

That Minyanville/Das article did a good job of not encapsulating the entire Greek and EU problem, but drew excellent parallels to the very same problems here in the US. Problems we’re doing our level best to “spend” away. As much whip as Uncle Sam might have, at some point its going to overwhelm us, too.

[Allan from Fallbrook]

[quote=Arraya]
It seems like it’s almost time to go into detox. What that will look like is a good question.[/quote]

Arraya: I think we all know what that will look like, which is why the American and EU governments have been avoiding it like the plague.

There isn’t a politician out there that wants to bell that particular cat, because, when they do, all hell is going to break loose.

We’re already seeing the reaction of the frugal and careful Germans to Greek excesses; just wait until Spain, Portugal and Italy come unglued. There is a massive unfunded pension overhang in most of the major Eurozone countries, births are below replacement rate and government debt/spending are completely out of whack.

That Minyanville/Das article did a good job of not encapsulating the entire Greek and EU problem, but drew excellent parallels to the very same problems here in the US. Problems we’re doing our level best to “spend” away. As much whip as Uncle Sam might have, at some point its going to overwhelm us, too.

[Allan from Fallbrook]

[quote=Arraya]
It seems like it’s almost time to go into detox. What that will look like is a good question.[/quote]

Arraya: I think we all know what that will look like, which is why the American and EU governments have been avoiding it like the plague.

There isn’t a politician out there that wants to bell that particular cat, because, when they do, all hell is going to break loose.

We’re already seeing the reaction of the frugal and careful Germans to Greek excesses; just wait until Spain, Portugal and Italy come unglued. There is a massive unfunded pension overhang in most of the major Eurozone countries, births are below replacement rate and government debt/spending are completely out of whack.

That Minyanville/Das article did a good job of not encapsulating the entire Greek and EU problem, but drew excellent parallels to the very same problems here in the US. Problems we’re doing our level best to “spend” away. As much whip as Uncle Sam might have, at some point its going to overwhelm us, too.

[Allan from Fallbrook]

[quote=Arraya]
It seems like it’s almost time to go into detox. What that will look like is a good question.[/quote]

Arraya: I think we all know what that will look like, which is why the American and EU governments have been avoiding it like the plague.

There isn’t a politician out there that wants to bell that particular cat, because, when they do, all hell is going to break loose.

We’re already seeing the reaction of the frugal and careful Germans to Greek excesses; just wait until Spain, Portugal and Italy come unglued. There is a massive unfunded pension overhang in most of the major Eurozone countries, births are below replacement rate and government debt/spending are completely out of whack.

That Minyanville/Das article did a good job of not encapsulating the entire Greek and EU problem, but drew excellent parallels to the very same problems here in the US. Problems we’re doing our level best to “spend” away. As much whip as Uncle Sam might have, at some point its going to overwhelm us, too.

[DWCAP]

I have to agree with rich, in that keynesian economics success or failure depends upon your timeline. In the short run it works wonders, raising GPD and lowering unemployment and increaseing spending etc etc etc.

But Eugene, you never addressed my question in the greeenspan vs Krugman thread. How can the stimulus be pulled back without putting us into another recession? If it was a simple recession, I can understand it, but this isnt a standard recession, this is a debt crisis. How do you get out of a debt crisis by creating more debt?
Perhaps Greece isnt the right model for us, but Japan seems not too far off. They have never recovered from their massive bubbles, and they have followed stimulus measures to 200% of GPD, and have the advantage of being a export nation.

I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.

[DWCAP]

I have to agree with rich, in that keynesian economics success or failure depends upon your timeline. In the short run it works wonders, raising GPD and lowering unemployment and increaseing spending etc etc etc.

But Eugene, you never addressed my question in the greeenspan vs Krugman thread. How can the stimulus be pulled back without putting us into another recession? If it was a simple recession, I can understand it, but this isnt a standard recession, this is a debt crisis. How do you get out of a debt crisis by creating more debt?
Perhaps Greece isnt the right model for us, but Japan seems not too far off. They have never recovered from their massive bubbles, and they have followed stimulus measures to 200% of GPD, and have the advantage of being a export nation.

I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.

[DWCAP]

I have to agree with rich, in that keynesian economics success or failure depends upon your timeline. In the short run it works wonders, raising GPD and lowering unemployment and increaseing spending etc etc etc.

But Eugene, you never addressed my question in the greeenspan vs Krugman thread. How can the stimulus be pulled back without putting us into another recession? If it was a simple recession, I can understand it, but this isnt a standard recession, this is a debt crisis. How do you get out of a debt crisis by creating more debt?
Perhaps Greece isnt the right model for us, but Japan seems not too far off. They have never recovered from their massive bubbles, and they have followed stimulus measures to 200% of GPD, and have the advantage of being a export nation.

I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.

[DWCAP]

I have to agree with rich, in that keynesian economics success or failure depends upon your timeline. In the short run it works wonders, raising GPD and lowering unemployment and increaseing spending etc etc etc.

But Eugene, you never addressed my question in the greeenspan vs Krugman thread. How can the stimulus be pulled back without putting us into another recession? If it was a simple recession, I can understand it, but this isnt a standard recession, this is a debt crisis. How do you get out of a debt crisis by creating more debt?
Perhaps Greece isnt the right model for us, but Japan seems not too far off. They have never recovered from their massive bubbles, and they have followed stimulus measures to 200% of GPD, and have the advantage of being a export nation.

I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.

[DWCAP]

I have to agree with rich, in that keynesian economics success or failure depends upon your timeline. In the short run it works wonders, raising GPD and lowering unemployment and increaseing spending etc etc etc.

But Eugene, you never addressed my question in the greeenspan vs Krugman thread. How can the stimulus be pulled back without putting us into another recession? If it was a simple recession, I can understand it, but this isnt a standard recession, this is a debt crisis. How do you get out of a debt crisis by creating more debt?
Perhaps Greece isnt the right model for us, but Japan seems not too far off. They have never recovered from their massive bubbles, and they have followed stimulus measures to 200% of GPD, and have the advantage of being a export nation.

I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.

[briansd1]

[quote=DWCAP]
I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.[/quote]

You don’t have to go back into recession.

You are simply trading some future economic growth, spread out over time, for the spending today. In the mean time, you preserve standards of living, social harmony and assure continuity.

Greenspan talked about government policy and technology bringing about moderation in the business cycle. I believe there is truth to that.

If the future, technology and improved productivity may allow us to more easily “pay back” today’s spending.

BTW, that’s what I believe is happening in the higher end housing markets. They are trading future real price appreciation for stability today. If you’re a homeowner, you’re grateful for the stability of your investment, as long as you have the wherewithal to service your debt. You don’t really care about 20 years or 30 years down the road.

[briansd1]

[quote=DWCAP]
I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.[/quote]

You don’t have to go back into recession.

You are simply trading some future economic growth, spread out over time, for the spending today. In the mean time, you preserve standards of living, social harmony and assure continuity.

Greenspan talked about government policy and technology bringing about moderation in the business cycle. I believe there is truth to that.

If the future, technology and improved productivity may allow us to more easily “pay back” today’s spending.

BTW, that’s what I believe is happening in the higher end housing markets. They are trading future real price appreciation for stability today. If you’re a homeowner, you’re grateful for the stability of your investment, as long as you have the wherewithal to service your debt. You don’t really care about 20 years or 30 years down the road.

[briansd1]

[quote=DWCAP]
I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.[/quote]

You don’t have to go back into recession.

You are simply trading some future economic growth, spread out over time, for the spending today. In the mean time, you preserve standards of living, social harmony and assure continuity.

Greenspan talked about government policy and technology bringing about moderation in the business cycle. I believe there is truth to that.

If the future, technology and improved productivity may allow us to more easily “pay back” today’s spending.

BTW, that’s what I believe is happening in the higher end housing markets. They are trading future real price appreciation for stability today. If you’re a homeowner, you’re grateful for the stability of your investment, as long as you have the wherewithal to service your debt. You don’t really care about 20 years or 30 years down the road.

[briansd1]

[quote=DWCAP]
I really would like to hear the long term argument of how you get out of keynesian stimulus without going back into recessions.[/quote]

You don’t have to go back into recession.

You are simply trading some future economic growth, spread out over time, for the spending today. In the mean time, you preserve standards of living, social harmony and assure continuity.

Greenspan talked about government policy and technology bringing about moderation in the business cycle. I believe there is truth to that.

If the future, technology and improved productivity may allow us to more easily “pay back” today’s spending.

BTW, that’s what I believe is happening in the higher end housing markets. They are trading future real price appreciation for stability today. If you’re a homeowner, you’re grateful for the stability of your investment, as long as you have the wherewithal to service your debt. You don’t really care about 20 years or 30 years down the road.

[Author]

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