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Old 12-13-2008, 05:17 PM   #31
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What Greenspan did was Keyensian economics and the left is licking their lips at the opportunity to increase the size of government and blame capitalism for government mistakes. Maybe the government shouldn't have lowered interest rates so low for so long.
I think you are being unfair to Keynesians - contrary to what is sometimes claimed, Keynes only advocated government intervention as a last resort.

You seem to be confusing and conflating several different issues. I agree with you that Greenspan kept interest rates too low for too long. In my view this is most likely because the Bushies presurised him to do so. Nothing to do with Keynesianism.

We now have Keynesianism being offered - rightly or wrongly - as the SOLUTION to the problems caused by the crunch, which was in turn caused by the excess liquidity in the system. Critique that response as you wish, but governments feeding credit bubbles was never advocated by Keynes (precisely the opposite in fact).
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Old 12-14-2008, 01:33 PM   #32
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I think you are being unfair to Keynesians - contrary to what is sometimes claimed, Keynes only advocated government intervention as a last resort.

You seem to be confusing and conflating several different issues. I agree with you that Greenspan kept interest rates too low for too long. In my view this is most likely because the Bushies presurised him to do so. Nothing to do with Keynesianism.

We now have Keynesianism being offered - rightly or wrongly - as the SOLUTION to the problems caused by the crunch, which was in turn caused by the excess liquidity in the system. Critique that response as you wish, but governments feeding credit bubbles was never advocated by Keynes (precisely the opposite in fact).
Sorry, Neo Keynesians. That is what Krugman is. Greenspan looked at himself as a monetarist but in practice he wasn't, and probably from political influence as you say. Keynes opened the door for governments to continue to use those tools not as he said exactly. This is why Keynes is used as a derogatory term. He knew governments could take advantage of those tools to increase the size of government but he hoped that enlightened leaders would be elected to follow him instead. Well looking at all the deficits that have occurred from every periodic recession I don't see them being paid back very often. This forces the tax payer to keep paying interest on prior spending, and that also constricts what can be spent currently by governments. If people want more social programs they can't have low taxes at the same time. This is something that politicians from the left and right need to get into their thick skulls.

Now Keynes did criticize savings. Look at his "paradox of thrift". He also advocated going into deficit but he wanted that deficit to be eliminated when there was a recovery. Looking at Greece and their attempts to rein in deficits you can see the political consequences of doing so.

My other arguments involving Naomi Klein show the the popular left licking their lips and can't wait to nationalize companies and increase their size every downturn of the economy. My Marxist sociology professor already admitted that goal with enthusiasm. Look at the U.S. All we need is to update our regulations and improve transparency in accounting standards but now there's a threat of nationalizing auto companies. I feel that Keynes underestimated how greedy and hungry bureaucrats are for positions in the government. This is why we have the problems we do. I don't know if a gold standard can solve the problem (you can debase gold, withhold it from the market with government powers), but there has to be some consistent production of money so the market doesn't try and take advantage of loose monetary policies where money is produced way faster than the growth of goods.

It's good to see some signs of Americans saving and paying their mortgages faster. I hope they will continue to do so in the future so they can comfortably retire. The Neo-Keynesians don't want savings now because of their obssession with full employment at all times even using low interest rates to do that when not necessary. I also don't like how the government measures inflation by excluding food and energy. How can they produce money accurately so savers don't get punished with lower purchasing power? It seems to me another tool to help government to hide their errors. Because despite what people say about capitalism they don't seem to clue in on the government's involvement with monetary and fiscal policies. They just blame markets as a scapegoat and I'm tired of it. There are consequences to interest rate policy (monetary policy) and deficits/surpluses (fiscal policy). What is happening now could have been avoided.

YouTube - Gordon Brown and David Cameron clash over debt

Here's an example of the same problems. Big booms and big busts and the right is the boogie man for not caring enough for the poor. Governments seem to never prepare for busts even if they happen over and over again. Is there amnesia or do they purposefully want busts? Call me cynical but I think government wants to grow.
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Old 12-14-2008, 02:26 PM   #33
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There is something to be said for paying off your mortgage debt quickly.

But to me, there are other things in life that bring me far more joy than home ownership. And I decided long ago that I had little interest in putting my life on hold in the name of the holy mortgage. That doesn't mean that I don't save; I just don't think that you can basically force all human beings into the same mould and tell them to live their lives the same way and criticize other ways of doing it. And I think that you have a tendency to think that there is one way or the highway and if we're not doing it your way, we're terribly wrong. I think you'd be a better economist if you considered a variety of views.
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Old 12-14-2008, 02:35 PM   #34
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Dont worry guys. Gordon Brown saved the world.
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Old 12-14-2008, 03:00 PM   #35
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You always steer the conversation away from context. I was talking to Vega on Europeans and left wing intellectuals.

Who are you fooling? Countries like Venezuela and Cuba are a goal for left wing intellectuals. No one is saying all of Greece is left wing intellectuals. I gave plenty of details in prior posts on this thread on what could be improved in Greece without going the left wing way. You are the one who ignores.
If you were talking to Vega, then don't quote me.

But you are still making horrible generalizations about so called "left-wing intellectuals"...
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Old 12-14-2008, 06:26 PM   #36
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i may not qualify as a left-wing intellectual (financeguy, what do you think?), but i must say that i don't consider the cuban or venezuelan state to be any type of goal. oscar seems to be conflating defense from the capitalist/neoliberal hegemony with aspiration. obviously, i can't speak for everyone.
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Old 12-14-2008, 09:29 PM   #37
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i may not qualify as a left-wing intellectual (financeguy, what do you think?), but i must say that i don't consider the cuban or venezuelan state to be any type of goal. oscar seems to be conflating defense from the capitalist/neoliberal hegemony with aspiration. obviously, i can't speak for everyone.
As I explained to you before, I would like to see more alliances between left and right libertarians.

I view the essential struggle of our times as between statism and libertarianism.

And I've tried to explain what my analysis of the situation is, namely that the real struggle has to do with protecting the private citizen against infringements from the threat to freedom posed by oligarchical capitalism, multi-nationals, and big government.

Sinn Fein (a left wing, nominally socialist party) were the only semi-mainstream political party in Ireland to call for a No vote on Lisbon - much as I disparage most of the actions of the Provisional IRA, I applaud Sinn Fein on this.
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Old 12-14-2008, 09:54 PM   #38
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i may not qualify as a left-wing intellectual (financeguy, what do you think?), but i must say that i don't consider the cuban or venezuelan state to be any type of goal. Oscar seems to be conflating defense from the capitalist/neoliberal hegemony with aspiration. Obviously, i can't speak for everyone.

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Old 12-15-2008, 12:48 PM   #39
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i may not qualify as a left-wing intellectual (financeguy, what do you think?), but i must say that i don't consider the cuban or venezuelan state to be any type of goal. oscar seems to be conflating defense from the capitalist/neoliberal hegemony with aspiration. obviously, i can't speak for everyone.
If you want to use Gramsci attitudes of "capitalist/neoliberal hegemony" to criticise me then it appears to me that you are at minimum influenced by the far left whether you are aware of it or not.

Antonio Gramsci - Wikipedia, the free encyclopedia

It's not hegemony if politicians have to deal with human nature and economic laws that are like gravity.
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Old 12-15-2008, 01:04 PM   #40
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As I explained to you before, I would like to see more alliances between left and right libertarians.

I view the essential struggle of our times as between statism and libertarianism.

And I've tried to explain what my analysis of the situation is, namely that the real struggle has to do with protecting the private citizen against infringements from the threat to freedom posed by oligarchical capitalism, multi-nationals, and big government.

Sinn Fein (a left wing, nominally socialist party) were the only semi-mainstream political party in Ireland to call for a No vote on Lisbon - much as I disparage most of the actions of the Provisional IRA, I applaud Sinn Fein on this.
The compatibility is very lacking. Left wing libertarians are socially in agreement with right wing libertarians but they are economic statists. The influence of libertarians is better with the center-right to move them right on economic statism. Social liberalism may come later in Conservative parties like in Canada.

Contrary to people on this board, showing evidence of a popular left wing like Naomi Klein wanting to nationalize Exxon should raise alarm bells. I'm glad progressives here are distancing themselves from Chavez but why are people like Naomi Klein so popular with the left? When I see people defending Greek anarchists and attacking Chavez I think there is at least some confusion. Anarchists are very far left and would look at Obama as a far-right candidate.

What we really need is regulation that allows investors less information asymmetry. Currently the accounting rules are allowing for some debt to be held off the balance sheet. This is why banks don't trust to lend to each other because they are aware of what future losses maybe lurking outside financial statements, since they do it themselves. That's why there is a credit freeze. This is also why we will have more surprises when they start recognizing those losses on the financials bit by bit like they have this past year.

If investors know that something is crap they won't invest in it. Car loan debt, sub-prime mortgage debt, credit card debt cannot be aloud to be called AAA when converted into investments for the public to buy. Debt should also not be allowed to be resold.

Do people believe the last 8 years was really 2-3% inflation like the government says? Now that there is a crash there is some deflation but deflation allows lower prices which in turn can revive some spending. This nullifies the "Paradox of Thrift" by Keynes. Retirees with fixed incomes can't keep eating inflation all the time. The interest rates should be based on real inflation to give savers a reason to save. Deficits should be eliminated ASAP and overall government debt should be paid off bit by bit. As interest charges are reduced from having less overall government debt there will be more money for government spending AND tax cuts. Alberta did this already and it's possible for others to do so even without oil to speed up the process.

Now future generations will benefit the most from this and current generations will have to struggle with this problem but I'm not just thinking about myself. I actually care about future generations. The debt in the U.S. is particularly massive and will require some administration to realistically raise taxes and cut spending and this administration will have to take criticism from the left and right to achieve this. Bush lowered taxes and increased spending. We can see that doesn't work. Obama wants to raise taxes to the Clinton era to corporations and lower taxes to the "middle class" and refund social security payments for those who don't pay tax to achieve 95% of the population receiving a tax cut. Yet he wants to massively increase health entitlements so I don't see any solutions other than more right wing solutions than the Republican party. There has to be some political influence at some point to put the brakes on the deficit and debt in bold fashion whether it's popular or not. The economist magazine already did a survey asking people about taxes and spending. Most people said yes to both more spending and lower taxes.

Calling right wing points of view "generalizations" and right wing libertarians seeing a future in allying with left wing libertarians doesn't make sense to me. That will have to be explained further for me to understand how that would be more successful than the right libertarians influencing the the center-right.

When Nixon said "we are all Keynesians now" you think I'm being unfair to Keynes? The entire 20th century economic history has governments using Keynes (fairly or unfairly) leading to exagerrated boom bust cycles we see now. Keynes is the most politically influential economist I've seen. If politicians don't pay back deficits when there is a boom then what are we to do with Keynes ideas of deficits that are supposed to be paid back? Is it realistic that it will be paid back?

Also if China threatens to sell U.S. bonds then is it realistic that the U.S. will be able to keep interest rates low even if we need to? If the Chinese ever decide en mass to sell some bonds to pay off their own debts or consume internally in their own economy that would trigger a currency crisis. Either print money or drastically raise interest rates to coax investment.

If Obama wants to be a "change" then he should raise taxes and cut spending and take the heat from all parties. I prefer keeping taxes as they are and cutting spending more but that will be resisted in congress so increasing taxes and cutting spending is the only politically viable solution I can see now to balance the budget sometime in the next 10 years.

Now what I want to see is your opinion on the financial crisis.

Should bailouts be used? How will they work?

Why should auto-companies get bailed out and not other industries?

Do we live in a world now that temporary unemployment of 10% during a recession is now something that we should avoid at ALL cost?

Are the social programs we have now good enough to handle higher unemployment?

To try and stay somewhat topical: Do you defend the anarchists from Greece in this thread?
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Old 12-15-2008, 01:05 PM   #41
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If you were talking to Vega, then don't quote me.

But you are still making horrible generalizations about so called "left-wing intellectuals"...
Well pardon me, but there are very many left-wing intellectuals that sell lots of books and left-wing university professors influence lots of students.

Naomi Klein is a very popular leftist and I've seen respected left-wing journalists defend Chavez plenty of times. Certainly it is possible that they have changed their minds and I'll allow you that.

I'm glad you don't agree with them.

Now what I want to see is your opinion on the financial crisis.

Should bailouts be used? How will they work?

Why should auto-companies get bailed out and not other industries?

Do we live in a world now that temporary unemployment of 10% during a recession is now something that we should avoid at ALL cost?

Are the social programs we have now good enough to handle higher unemployment?

To try and stay somewhat topical: Do you defend the anarchists from Greece in this thread?
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Old 12-15-2008, 02:12 PM   #42
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If you want to use Gramsci attitudes of "capitalist/neoliberal hegemony" to criticise me then it appears to me that you are at minimum influenced by the far left whether you are aware of it or not.

Antonio Gramsci - Wikipedia, the free encyclopedia

It's not hegemony if politicians have to deal with human nature and economic laws that are like gravity.
i never meant to imply that i wasn't left wing. i'm probably one of the most left wing posters on this board. i was suggesting that i may not qualify as an intellectual.

the latter part of your post is telling, and in hindsight, most of your other posts make sense given your assumptions. are you seriously arguing that ideological domination plays no role in social construction? tell me oscar, can the "economic laws" bend light as well?

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Left wing libertarians are socially in agreement with right wing libertarians but they are economic statists.
could you explain this to me in some more detail? it seems to contradict the fact that i am not a statist in any sense.
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Old 12-15-2008, 03:02 PM   #43
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To try and stay somewhat topical: Do you defend the anarchists from Greece in this thread?

Since this is the only sentence in the last several of your posts that's on topic I'll answer it...

No. I don't agree with their means, and I'm not even sure they really know why they are doing this...

Everything else you've posted is so far off topic and all over the place it's confusing to be honest. You contradict, you assume, you misspeak... it's just a mess.
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Old 12-15-2008, 05:47 PM   #44
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Why should auto-companies get bailed out and not other industries?
I think it is better to put the money into re-training. The US should probably only have one or auto companies.


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To try and stay somewhat topical: Do you defend the anarchists from Greece in this thread?
That sounds like a question of the 'when did you stop beating your wife?' variety.
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Old 12-15-2008, 06:51 PM   #45
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As I explained to you before, I would like to see more alliances between left and right libertarians.

I view the essential struggle of our times as between statism and libertarianism.
sorry to be rude, financeguy, i overlooked this comment. while i can appreciate your skepticism of the state, i just don't see how our differences could be bridged to form any type of coalition.
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