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(NPR)   The fake economist who conned an entire nation. Shockingly, not about Paul Krugman   (npr.org) divider line 144
    More: Interesting, Paul Krugman, media pundits, Planet Money, economists, fake  
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16570 clicks; posted to Main » on 25 Jan 2013 at 2:58 PM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-01-25 03:00:29 PM
Drink!
 
2013-01-25 03:02:59 PM
Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.
 
2013-01-25 03:03:54 PM
Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.
 
2013-01-25 03:06:18 PM

Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.


Precisely what I was thinking.

/fun fact: Adam Smith did not have a degree in economics
 
2013-01-25 03:06:41 PM

Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.


Done in two.
 
2013-01-25 03:07:38 PM
I wonder how many farkers cited his work.
 
2013-01-25 03:09:51 PM
Awww, poor subtard, his GED in Economics is FAR more cromulent than anything Krugman has ever done, but yet no one recognizes that!
 
2013-01-25 03:11:19 PM
He got away with it because he was correct. Austerity in a recession creates a downward spiral.
 
2013-01-25 03:12:47 PM
u18chan.com
 
jvl
2013-01-25 03:14:04 PM

Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.


I hear this argument a lot on Fark. That doesn't make it true.

No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore.  Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.
 
2013-01-25 03:14:55 PM
Not a John Law retrospective?

/Not technically a fake, but he did kill a man.
 
2013-01-25 03:15:04 PM
A basic rule of thumb that will, apparently, never sink into common human knowledge is... if some one is very charismatic they are full of shiat and suitable only as entertainment.

'fake economist'? What's the opposite of an oxymoron?
 
2013-01-25 03:17:01 PM

ghare: Awww, poor subtard, his GED in Economics is FAR more cromulent than anything Krugman has ever done, but yet no one recognizes that!


Funny thing is, Krugman would very likely have a similar recommendation.
 
2013-01-25 03:17:09 PM

jvl: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

I hear this argument a lot on Fark. That doesn't make it true.

No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore.  Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.


Austerity can be good for some countries if their neighbors / trading partners are wealthy and growing. It reduces the "crowding-out" effect of government and makes your economy more sustainable. But if all your neighbors are also cutting spending or are undergoing their own recessions, you're just going to end up hurting a lot of people and discrediting your policies.
 
2013-01-25 03:17:28 PM

hitlersbrain: What's the opposite of an oxymoron?


Nitrogenius
 
2013-01-25 03:19:47 PM

Bawdy George: ghare: Awww, poor subtard, his GED in Economics is FAR more cromulent than anything Krugman has ever done, but yet no one recognizes that!

Funny thing is, Krugman would very likely have a similar recommendation.


Wat?

"But the truth is that the protesters are right. More austerity serves no useful purpose; the truly irrational players here are the allegedly serious politicians and officials demanding ever more pain."
 
2013-01-25 03:20:27 PM
www.alumni.ucdavis.edu
To be fair, fooling the whole of Portugal isn't a big achievement.
 
2013-01-25 03:22:44 PM

jvl: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

I hear this argument a lot on Fark. That doesn't make it true.

No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore.  Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.



Because they print their own currency, sovereign states cannot go bankrupt, so they are not analogous to the familial finances of the woman who is still apparently letting you live in her basement and troll the nets.
 
2013-01-25 03:22:49 PM
The USSR would say it was Karl Marx.
 
2013-01-25 03:25:08 PM
Is this about Milton Freidman and the Chicago School's South American AdventuresTM?
 
2013-01-25 03:25:17 PM

worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.


www.talktalk.co.uk

Are you having' a laugh?
 
2013-01-25 03:31:22 PM
"Trololololooooo..." ♬
 
2013-01-25 03:32:04 PM
Milton Friedman?
 
2013-01-25 03:32:36 PM
Unfortunately Krugman did fool the entire planet at one time. Saying he is a tool is disrespectful of actual tools, which do useful things for society.
 
d23 [TotalFark]
2013-01-25 03:34:03 PM
EVERY economist is a fake*


*except the type that do the studies like you see in "Freakanomics" that use REAL data and not PULL-IT-OUT-YOUR-ASS data.


It's one big scam.
 
2013-01-25 03:35:24 PM
cms.mainattraction.net

R.I.P.
 
2013-01-25 03:36:23 PM

AssAsInAssassin: hitlersbrain: What's the opposite of an oxymoron?

Nitrogenius


I like it. It's 'sciencey'.
 
2013-01-25 03:36:38 PM

AssAsInAssassin: Bawdy George: ghare: Awww, poor subtard, his GED in Economics is FAR more cromulent than anything Krugman has ever done, but yet no one recognizes that!

Funny thing is, Krugman would very likely have a similar recommendation.

Wat?

"But the truth is that the protesters are right. More austerity serves no useful purpose; the truly irrational players here are the allegedly serious politicians and officials demanding ever more pain."


FTFA: "It seems like Baptista da Silva pulled off his con in part because he said what a lot of people wanted to hear. He criticized the harsh austerity measures imposed by the government"

See much difference there? I don't, other than Krugman was talking about Spain and Greece rather than Portugal.
 
2013-01-25 03:39:32 PM

deadsanta: Because they print their own currency, sovereign states cannot go bankrupt, so they are not analogous to the familial finances of the woman who is still apparently letting you live in her basement and troll the nets.


Isn't Greece's problem that they don't control the printing of their own currency?

They have a way out, but it involves leaving the Eurozone.
 
2013-01-25 03:43:58 PM
Shockingly, not about Paul Krugman

That's because no one listens to Paul Krugman!

(Krugman is actually the best pundit employed by a major newspaper and he has genuine economics expertise.)
 
2013-01-25 03:45:20 PM
A lot of the pro-austerity pundits have no training in economics either. Doesn't stop people listening to them...
 
2013-01-25 03:46:14 PM

Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.


True. A very few wealthy select are coming out ahead with how Europe is handling their banking crises. Putting that debt on the back of the government has made the governments fail. The only country who properly handled it was Iceland. Iceland is now humming along while the PIGS are all in the midst of a full blown depression. The only out is to default on their debt at this point, since anything that can't be paid back, won't.
 
2013-01-25 03:46:51 PM

worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.


Most serious leftist Keynesians accept the Laffer curve, but argue that we are nearly always on the pro-demand-side economics segment of the graph. It is after all based on accepted definitions. Rightist economists somply argue that we are nearly always on the pro-supply-side economics segment of the graph. The Laffer curve is a laughingstock not because of its lack of theoretical utility, but because of the constant references by rightist economists.
 
2013-01-25 03:48:49 PM
And anyways, being a real economist doesn't necessarily involve a relationship with social phenomena... a lot of econ consists of wonderful models that break down as soon as complex dynamics and real people have to be accounted for.
 
2013-01-25 03:51:08 PM

worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.


The laffer curve exists - what's hard/next to impossible to predict is where we are on the curve. Any economist who claims to know is lying.
 
2013-01-25 03:51:39 PM

TofuTheAlmighty: (Krugman is actually the best pundit employed by a major newspaper and he has genuine economics expertise.)


There is a gigantic gap between Krugman the social scientist and Krugman the polemicist.
 
2013-01-25 03:52:54 PM
static.designspiration.net

Bush released the college transcripts showing he scored higher than his opponent Kerry at Yale. Aren't we still waiting for a certain someone to release his college transcripts? Maybe he smoked them all.
 
2013-01-25 03:54:23 PM

OscarTamerz: [static.designspiration.net image 530x365]

Bush released the college transcripts showing he scored higher than his opponent Kerry at Yale. Aren't we still waiting for a certain someone to release his college transcripts? Maybe he smoked them all.


And for our next performance of Non Sequitur Theatre,
 
2013-01-25 03:54:43 PM

garandman1a: Unfortunately Krugman did fool the entire planet at one time. Saying he is a tool is disrespectful of actual tools, which do useful things for society.


Please explain why Paul Krugman is generally wrong and how specifically he "fooled the entire planet". I'm interested in the perspective that your no-doubt intensive training in economics has granted you in this matter.
 
2013-01-25 03:55:34 PM

d23: EVERY economist is a fake*

*except the type that do the studies like you see in "Freakanomics" that use REAL data and not PULL-IT-OUT-YOUR-ASS data.

It's one big scam.


I hope this is just trolling. Freakonomics is methodologically about as useless as the Laffer curve.

Granted, it's dazzlingly impressive to contrarian morons.
 
2013-01-25 03:58:38 PM

OscarTamerz: [static.designspiration.net image 530x365]

Bush released the college transcripts showing he scored higher than his opponent Kerry at Yale. Aren't we still waiting for a certain someone to release his college transcripts? Maybe he smoked them all.


I'd beg you to give that poor chicken a break, but it's just a mass of bloody feathers.
 
2013-01-25 04:00:20 PM

deadsanta: Because they print their own currency, sovereign states cannot go bankrupt, so they are not analogous to the familial finances of the woman who is still apparently letting you live in her basement and troll the nets.


That holds unless "printing more money" isn't actually an option. For most of the Eurozone countries, it's pretty much a legal nonoption: the dark side, if you will, of having a unified monetary policy.

In the US, it's a little different. You've got a party that sees printing more money as an unacceptably dishonest thing to do, and thus off the table. Remove it as an option, and the analogy starts to make a lot more sense.
 
2013-01-25 04:00:30 PM

GoodOmens: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

The laffer curve exists - what's hard/next to impossible to predict is where we are on the curve. Any economist who claims to know is lying.


That's much more succinct. Thank you.
 
2013-01-25 04:03:06 PM

Cagey B: garandman1a: Unfortunately Krugman did fool the entire planet at one time. Saying he is a tool is disrespectful of actual tools, which do useful things for society.

Please explain why Paul Krugman is generally wrong and how specifically he "fooled the entire planet". I'm interested in the perspective that your no-doubt intensive training in economics has granted you in this matter.


Krugman's always wrong, and bad, and wrong. Because freedoms. And America!
 
2013-01-25 04:03:44 PM

Millennium: deadsanta: Because they print their own currency, sovereign states cannot go bankrupt, so they are not analogous to the familial finances of the woman who is still apparently letting you live in her basement and troll the nets.

That holds unless "printing more money" isn't actually an option. For most of the Eurozone countries, it's pretty much a legal nonoption: the dark side, if you will, of having a unified monetary policy.

In the US, it's a little different. You've got a party that sees printing more money as an unacceptably dishonest thing to do, and thus off the table. Remove it as an option, and the analogy starts to make a lot more sense.


Fortunately for Greek citizens, their government is encouraging misbehavior in that regard.
 
2013-01-25 04:09:59 PM

AssAsInAssassin: hitlersbrain: What's the opposite of an oxymoron?

Nitrogenius


Heroineinstein?
 
2013-01-25 04:11:29 PM

OscarTamerz: [static.designspiration.net image 530x365]

Bush released the college transcripts showing he scored higher than his opponent Kerry at Yale. Aren't we still waiting for a certain someone to release his college transcripts? Maybe he smoked them all.


He was President of the Harvard Law review. Bush was retarded, if he had high grades it was because his daddy bought them. He only had 2 answers to any questions; 1 - Jesus. 2. - Ask Dick Cheney.
 
2013-01-25 04:11:36 PM

Fark Rye For Many Whores: [www.alumni.ucdavis.edu image 360x326]
To be fair, fooling the whole of Portugal isn't a big achievement.


OH so you fooled all of what, Uruguay? Pffft
Give the guy his due, jesus don't be so cheap.

Dude, you are one suave Mother Farker.
www.brixpicks.com
"The Candy Colored Clown they call The Sandman, tip toes to my room every night"
HERE'S TO BEN!
okay, so it was a harsh day and I'm a little off, at least that's out of the way. . .
 
2013-01-25 04:15:33 PM

OscarTamerz: [static.designspiration.net image 530x365]

Bush released the college transcripts showing he scored higher than his opponent Kerry at Yale. Aren't we still waiting for a certain someone to release his college transcripts? Maybe he smoked them all.


When will OscarTamerz release his police records? I would think he would be pretty anxious to prove he's not a child molester, but maybe he has different priorities than the rest of us.
 
2013-01-25 04:18:42 PM
The Austrian School is more than one economist.

/austrian school - faith based economics
 
2013-01-25 04:25:14 PM
Moist von Lipwig
 
2013-01-25 04:27:27 PM

gameshowhost: The Austrian School is more than one economist.

/austrian school - faith based economics


The economy is based on faith.
 
2013-01-25 04:31:30 PM
You're right....until you're wrong.
 
2013-01-25 04:32:05 PM

Wangiss: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

Most serious leftist Keynesians accept the Laffer curve, but argue that we are nearly always on the pro-demand-side economics segment of the graph. It is after all based on accepted definitions. Rightist economists somply argue that we are nearly always on the pro-supply-side economics segment of the graph. The Laffer curve is a laughingstock not because of its lack of theoretical utility, but because of the constant references by rightist economists.


Even if you do accept the Laffer curve, it's often applied to top marginal tax rates, which doesn't seem to mesh with reality. A thought experiment: let's say you have a 100% marginal tax on income above $500,000, and 40% tax on income from $1 to $499,999.99. The Laffer curve would suggest that this would cause tax revenue to completely disappear (the far corner of the curve crosses the x-axis), but what would actually happen would be that people would stop accepting pay above $500,000, and instead ask their employers for non-monetary benefits (expense account, better health insurance, on-site daycare, car service, etc). There could also be any number of tax breaks that the high earners could take advantage of that reduce their taxable income. And the people making less than $500K would still continue to work, so there would still be tax revenue.

I'm not saying this is good policy, just pointing out a flaw.
 
2013-01-25 04:32:46 PM

Bawdy George: AssAsInAssassin: Bawdy George: ghare: Awww, poor subtard, his GED in Economics is FAR more cromulent than anything Krugman has ever done, but yet no one recognizes that!

Funny thing is, Krugman would very likely have a similar recommendation.

Wat?

"But the truth is that the protesters are right. More austerity serves no useful purpose; the truly irrational players here are the allegedly serious politicians and officials demanding ever more pain."

FTFA: "It seems like Baptista da Silva pulled off his con in part because he said what a lot of people wanted to hear. He criticized the harsh austerity measures imposed by the government"

See much difference there? I don't, other than Krugman was talking about Spain and Greece rather than Portugal.


Sorry, brain fart. I thought you were comparing Krugman to Subby's GED in economics.
 
2013-01-25 04:36:46 PM
Who cares if he's a fraud.

He makes common sense statements that the general public can agree with and get behind, credentials are an afterthought when it's someone saying what we already think.
 
2013-01-25 04:40:26 PM
Clicked expecting Grover Norquist. Oh well.
 
2013-01-25 04:41:18 PM
I thought for sure it would be about Ben Stein.
 
2013-01-25 04:43:39 PM

Muta: Being against the austerity cuts Agreeing with me makes him a better economist than all the "real" economists who think the cuts will help Portugal.


Be honest with yourself.
 
2013-01-25 04:47:04 PM

AssAsInAssassin: Sorry, brain fart. I thought you were comparing Krugman to Subby's GED in economics.


Well, that would certainly be the trollish thing to do, but I'm certain we both have better ways to occupy our time :)
 
2013-01-25 04:48:24 PM
so just for kicks...can somebody explain why/how printing money creates wealth in a society?
 
2013-01-25 04:49:00 PM
Came here for the libtards pretending to know about economics

Leaving well satisfied with tears of laughter

/I love you Fark
 
2013-01-25 04:52:50 PM
Didn't this guy play "Moocher' in "Breaking Away"?
 
2013-01-25 04:59:16 PM

Arkanaut: Wangiss: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

Most serious leftist Keynesians accept the Laffer curve, but argue that we are nearly always on the pro-demand-side economics segment of the graph. It is after all based on accepted definitions. Rightist economists somply argue that we are nearly always on the pro-supply-side economics segment of the graph. The Laffer curve is a laughingstock not because of its lack of theoretical utility, but because of the constant references by rightist economists.

Even if you do accept the Laffer curve, it's often applied to top marginal tax rates, which doesn't seem to mesh with reality. A thought experiment: let's say you have a 100% marginal tax on income above $500,000, and 40% tax on income from $1 to $499,999.99. The Laffer curve would suggest that this would cause tax revenue to completely disappear (the far corner of the curve crosses the x-axis), but what would actually happen would be that people would stop accepting pay above $500,000, and instead ask their employers for non-monetary benefits (expense account, better health insurance, on-site daycare, car service, etc). There could also be any number of tax breaks that the high earners could take advantage of that reduce their taxable income. And the people making less than $500K would still continue to work, so there would still be tax revenue.

I'm not saying this is good policy, just pointing out a flaw.


Simple solution: adjust for monetary value of non-monetary benefits. How much does the company car cost/benefit the receiver?

Complex solution: create a unified theory of macro & micro that addresses every possibility and factor in every decision.
 
jvl
2013-01-25 05:00:39 PM

deadsanta: Because they print their own currency, sovereign states cannot go bankrupt, so they are not analogous to the familial finances of the woman who is still apparently letting you live in her basement and troll the nets.


Things Portugal does not have: a sovereign currency.

Things all third-world countries do not get to do: borrow in their own currency.

Your argument: fail
 
SH
2013-01-25 05:01:40 PM

LordBollocks: Came here for the libtards pretending to know about economics

Leaving well satisfied with tears of laughter

/I love you Fark


Pretending to know about economics is as simple as looking at the numbers and facts since 1980. History proved Reaganomics was/is a scam and it will continue to be.
 
2013-01-25 05:03:17 PM
He was given a card which" didn't seem to be forged."

Well if he was given a CARD, then I can see how he might have mistakenly believed the guy was legit. I mean, a CARD, ferchrissake. How much more verification do you need?

/Hello, ma'am. I am Dr. Bagu M. Pity, MD. Here is my card. Now, for that free breast exam... Yes, I AM a doctor! Can't you read, woman? It's all right there on my CARD.
 
2013-01-25 05:13:34 PM

Arkanaut: jvl: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

I hear this argument a lot on Fark. That doesn't make it true.

No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore.  Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.

Austerity can be good for some countries if their neighbors / trading partners are wealthy and growing. It reduces the "crowding-out" effect of government and makes your economy more sustainable. But if all your neighbors are also cutting spending or are undergoing their own recessions, you're just going to end up hurting a lot of people and discrediting your policies.


His point is they have no choice but austerity. They're in the eurozone and therefore cannot print money, as such they are beholden to others to lend them money.

And "others" are rightly suspicious of peripheral countries ability to pay back any loans, and so are charging more. Absent austerity, the market would charge even more interest.

It's austerity or exit the eurozone. And so far, the leaders of peripheral countries apparently think the short term pain of austerity is worth the long term benefit of staying in the euro.
 
2013-01-25 05:16:12 PM

misanthropologist: And anyways, being a real economist doesn't necessarily involve a relationship with social phenomena... a lot of econ consists of wonderful models that break down as soon as complex dynamics and real people have to be accounted for.


That sort of makes the models that break down once applied to the real world a lot less wonderful, doesn't it?

Also never got the Krugman hate except for him exposing minarchists as not having an economic leg to stand on.
 
2013-01-25 05:19:27 PM
rsirving.files.wordpress.com
 
2013-01-25 05:26:07 PM

Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.


Because defaulting would really have helped them.
 
2013-01-25 05:31:01 PM

hitlersbrain: What's the opposite of an oxymoron?


deoxymoron
 
2013-01-25 05:31:18 PM

deadsanta: jvl: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

I hear this argument a lot on Fark. That doesn't make it true.

No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore.  Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.


Because they print their own currency, sovereign states cannot go bankrupt, so they are not analogous to the familial finances of the woman who is still apparently letting you live in her basement and troll the nets.


There's just this thing with Portugal...

They use the Euro, and they don't control that.

They are a soverign nation, so they could leave the Euro in favour of a Portugese currency. Their debt would still be in Euros, which they wouldn´t be able to repay with their new currency because it would be valued according to how their economy is, so they'd, ok let's not call it banrupt, they'd default on their debts.
 
2013-01-25 05:36:40 PM

Crotchrocket Slim: misanthropologist: And anyways, being a real economist doesn't necessarily involve a relationship with social phenomena... a lot of econ consists of wonderful models that break down as soon as complex dynamics and real people have to be accounted for.

That sort of makes the models that break down once applied to the real world a lot less wonderful, doesn't it?

Also never got the Krugman hate except for him exposing minarchists as not having an economic leg to stand on.


At least, no true economic leg to stand on.
 
2013-01-25 05:36:50 PM

worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.


That was my first thought when reading the headline.
 
2013-01-25 05:37:45 PM
Darn, I thought this would be about Ludwig von Mises.
 
2013-01-25 05:43:28 PM

spawn73: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

Because defaulting would really have helped them.


It's not a binary "austerity cuts or default" situation. Ideally, the Eurozone enables a different option; marshaling the resources of the rest of the member nations to prevent economic meltdown of a key regional market that would spill beyond its borders. The member states provide financial assistance to get a less stable political entity (in this case, Portugal) through a period of economic crisis (which the late '00s most certainly were). Then, when the economy improves, Portugal, not having put itself into a horrible depression, is more able to bounce back and continue being a productive economy.

Could Portugal and the other bailout cases have made better decisions? Of course they could, as really most nations (oursevles included) could have as well in better times. Thing is, outside of the Eurozone, they would have made the same decisions anyway. So you'd have a defaulting country f*cking up your flow of capital, trade opportunities and the world bond market, except now you as a regional economy really have no way to fix it.

Austerity is a self-defeating measure imposed by wealthier countries (i.e. Germany, France) because they're pissed at what they see as having to give THEIR money to these awful other countries. By salving the bruised feelings of their local constituencies, who demand a simplistic "family budget" approach to economics, they prolong economic crises in Ireland, Spain, Portugal, etc., and just ensure that they have to keep paying out for a longer period.

You're absolutely right about defaulting on debt obligations being bad for Portugal, and indeed everyone. But we have this useful tool already in place to help deal with that, which the EU is not employing correctly due to political pressure that stems from the basic human instinct to not help people that aren't us. Austerity is the politically easier course in the short term, but a very poor decision if what you want to do is shore up the European economy in the long term.
 
2013-01-25 05:47:08 PM

Cagey B: spawn73: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

Because defaulting would really have helped them.

It's not a binary "austerity cuts or default" situation. Ideally, the Eurozone enables a different option; marshaling the resources of the rest of the member nations to prevent economic meltdown of a key regional market that would spill beyond its borders. The member states provide financial assistance to get a less stable political entity (in this case, Portugal) through a period of economic crisis (which the late '00s most certainly were). Then, when the economy improves, Portugal, not having put itself into a horrible depression, is more able to bounce back and continue being a productive economy.

Could Portugal and the other bailout cases have made better decisions? Of course they could, as really most nations (oursevles included) could have as well in better times. Thing is, outside of the Eurozone, they would have made the same decisions anyway. So you'd have a defaulting country f*cking up your flow of capital, trade opportunities and the world bond market, except now you as a regional economy really have no way to fix it.

Austerity is a self-defeating measure imposed by wealthier countries (i.e. Germany, France) because they're pissed at what they see as having to give THEIR money to these awful other countries. By salving the bruised feelings of their local constituencies, who demand a simplistic "family budget" approach to economics, they prolong economic crises in Ireland, Spain, Portugal, etc., and just ensure that they have to keep paying out for a longer period.

You're absolutely right about defaulting on debt obligations being bad for Portugal, and indeed everyone. But we have this useful tool already in place to help deal with that, which the EU is not employing correctly due to political pressure that stems from the basic human instinct to not help pe ...


Is there a point at which you think austerity should kick in, or is endless profligacy just okay with you?
I don't ask this to try to make you look like a fool; you're doing great. I just want to know if you have an absolutist stance against it or they just haven't reached that point yet.
 
2013-01-25 05:59:45 PM

Wangiss: Is there a point at which you think austerity should kick in, or is endless profligacy just okay with you?


"Austerity", as in "radically curtailing government spending in a recession or otherwise crappy economy", is always a bad idea. There are probably a few select areas where government spending that doesn't help the bottom line (i.e. tax expenditures benefiting already profitable industries) could be curtailed, but it should be redirected back into moving the economy, through such things as public works projects and shoring up the social safety net.

The time to keep a tight reign on things is when you're running surpluses; it's important for governments to ensure that basic, essential programs are on sound structural footing in regards to funding. Which means not engaging in huge spending increases with no clear source of income while times are good. Building up reserve funds and paying down debts with surpluses isn't a bad idea either. You can see, though, why that's difficult politically.

With the current austerity cuts, the biggest impacts are on public employees and social safety net programs, which are not targeting "profligacy" at all, but instead cockpunching the economy directly by willfully increasing unemployment and reducing purchasing power on a broad scale.

What would ideally happen is that the heavy hand of the rest of the Eurozone would come *after* Portugal and the others come back around into generating surpluses again. Then the central authority could mandate (or at least try to) the stuff that should be happening during times of plenty.
 
2013-01-25 06:05:27 PM

Cagey B: spawn73: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

Because defaulting would really have helped them.

It's not a binary "austerity cuts or default" situation. Ideally, the Eurozone enables a different option; marshaling the resources of the rest of the member nations to prevent economic meltdown of a key regional market that would spill beyond its borders. The member states provide financial assistance to get a less stable political entity (in this case, Portugal) through a period of economic crisis (which the late '00s most certainly were). Then, when the economy improves, Portugal, not having put itself into a horrible depression, is more able to bounce back and continue being a productive economy.




But the options presented to Portugal, given the political climate, was defaulting or austerity.

I don't get the impression that this guy was talking about what the rest of the Eurozone should have done to handle the situation better, but rather just biatched about the Portugese politicians implementing austerity.
 
2013-01-25 06:08:35 PM
Doncha love the "I'm entitled to an opinion; therefore my opinion is EVERY BIT as valid as those at the forefront of a complex field which I've never studied except by reading blogs" generation? Call it a slavish argument from authority if you must, but when it comes to economic issues, I'll listen to the guy with a Nobel Prize in Economics over some anonymous troll any day of the week.
 
2013-01-25 06:12:45 PM
wiki.wooster.edu
Someone called for a fake economist?
 
2013-01-25 06:16:49 PM

spawn73: But the options presented to Portugal, given the political climate, was defaulting or austerity.

I don't get the impression that this guy was talking about what the rest of the Eurozone should have done to handle the situation better, but rather just biatched about the Portugese politicians implementing austerity.


I don't doubt that what you say in terms of the political feasibility of the options available to Portugal is correct. I just wanted to do my own biatching about how those shouldn't have been the only options on the table, I suppose.
 
2013-01-25 06:17:22 PM

Cagey B: Wangiss: Is there a point at which you think austerity should kick in, or is endless profligacy just okay with you?

"Austerity", as in "radically curtailing government spending in a recession or otherwise crappy economy", is always a bad idea. There are probably a few select areas where government spending that doesn't help the bottom line (i.e. tax expenditures benefiting already profitable industries) could be curtailed, but it should be redirected back into moving the economy, through such things as public works projects and shoring up the social safety net.

The time to keep a tight reign on things is when you're running surpluses; it's important for governments to ensure that basic, essential programs are on sound structural footing in regards to funding. Which means not engaging in huge spending increases with no clear source of income while times are good. Building up reserve funds and paying down debts with surpluses isn't a bad idea either. You can see, though, why that's difficult politically.

With the current austerity cuts, the biggest impacts are on public employees and social safety net programs, which are not targeting "profligacy" at all, but instead cockpunching the economy directly by willfully increasing unemployment and reducing purchasing power on a broad scale.

What would ideally happen is that the heavy hand of the rest of the Eurozone would come *after* Portugal and the others come back around into generating surpluses again. Then the central authority could mandate (or at least try to) the stuff that should be happening during times of plenty.


I agree almost entirely. Your definition of austerity, though, doesn't match what I've seen. I've heard even the switch from Spendthrift to Sustainable called "austerity" and even that is mocked by statist politicians and reviled by those who leverage Keynes as an one-sided excuse for welfare statism. (Which you're not doing.) That's one reason I wanted to know if you thought there should be some sort of cutoff.

The other reason I wanted to know is because, since all spending is not necessarily beneficial (as you sportingly admit), is there some point at which you can plainly tell that the spending is too much? 100% of GDP, for example, is a big hole to climb out of. 400% may be impossible. I'm certainly not new at this, but I have never heard a leftist (and I'm not pigeon-holing you as one; speak for yourself) declare that, for example, a 50% annual inflation rate is economic suicide or that a 200% debt-to-GDP ratio is irresponsible bullshiat. I wonder if the tip of the government spending graph in your philosophy is a dot or an arrow.
 
2013-01-25 06:27:40 PM

Cagey B: Wangiss: Is there a point at which you think austerity should kick in, or is endless profligacy just okay with you?

"Austerity", as in "radically curtailing government spending in a recession or otherwise crappy economy", is always a bad idea.


www.mediaite.com

Estonian president Ilves says "Perse, palun."
 
2013-01-25 06:31:25 PM

HailRobonia: Moist von Lipwig


We're shifting to the Golem standard!
 
2013-01-25 06:34:15 PM

Wangiss: The other reason I wanted to know is because, since all spending is not necessarily beneficial (as you sportingly admit), is there some point at which you can plainly tell that the spending is too much?


At some point, sure, there's a point where you simply cannot spend more. Resources are finite, and must be allocated wisely using some sort of system of prioritization. At some point debt will accumulate to the point where a government will begin to lose credibility in the eyes of those that provide its services, and things fall apart. I don't believe in an absolute point where that happens in all cases, nor do I pretend to know at what rate things tend to start becoming unsustainable. But sure, that point certainly must exist.

Wangiss: I'm certainly not new at this, but I have never heard a leftist (and I'm not pigeon-holing you as one; speak for yourself) declare that, for example, a 50% annual inflation rate is economic suicide or that a 200% debt-to-GDP ratio is irresponsible bullshiat.


I'm pretty left. If you were to categorize me, I'd probably describe myself a Marxist forced into a "market socialist" position by the current realities of world commerce, thought it's not nearly as neat as all that.

Under current models and conditions that exist in the real world, I'd be pretty comfortable saying that a 50% inflation rate and a 200% debt-to-GDP ratio would be pretty destructive to any economy, both from structural unsustainability that would result, and (perhaps even more importantly) the fact that it would kill economic credibility for any nation with those symptoms; to paraphrase someone upthread (I think it might have been you), people have to believe in an economy to make it work.
 
2013-01-25 06:40:59 PM

OscarTamerz: [static.designspiration.net image 530x365]

Bush released the college transcripts showing he scored higher than his opponent Kerry at Yale. Aren't we still waiting for a certain someone to release his college transcripts? Maybe he smoked them all.


Yeah, I heard he's so dumb that 68 Nobel Laureate Scientists endorsed him. Everyone knows that they're a bunch of mouth-breathers.
 
2013-01-25 06:41:47 PM

Cagey B: Wangiss: The other reason I wanted to know is because, since all spending is not necessarily beneficial (as you sportingly admit), is there some point at which you can plainly tell that the spending is too much?

At some point, sure, there's a point where you simply cannot spend more. Resources are finite, and must be allocated wisely using some sort of system of prioritization. At some point debt will accumulate to the point where a government will begin to lose credibility in the eyes of those that provide its services, and things fall apart. I don't believe in an absolute point where that happens in all cases, nor do I pretend to know at what rate things tend to start becoming unsustainable. But sure, that point certainly must exist.

Wangiss: I'm certainly not new at this, but I have never heard a leftist (and I'm not pigeon-holing you as one; speak for yourself) declare that, for example, a 50% annual inflation rate is economic suicide or that a 200% debt-to-GDP ratio is irresponsible bullshiat.

I'm pretty left. If you were to categorize me, I'd probably describe myself a Marxist forced into a "market socialist" position by the current realities of world commerce, thought it's not nearly as neat as all that.

Under current models and conditions that exist in the real world, I'd be pretty comfortable saying that a 50% inflation rate and a 200% debt-to-GDP ratio would be pretty destructive to any economy, both from structural unsustainability that would result, and (perhaps even more importantly) the fact that it would kill economic credibility for any nation with those symptoms; to paraphrase someone upthread (I think it might have been you), people have to believe in an economy to make it work.


Wasn't me, but yeah, it's a faith thing.

I'm a progressive minarchist, so we either have nearly everything in common or virtually nothing in common, depending on whether you're a Marx Marxist or a post-Marx Marxist. ;)
 
2013-01-25 06:43:31 PM
Wait, so this isn't about Ron Paul?

Oh right, he didn't actually fool anyone who matters.
 
2013-01-25 07:09:00 PM

MrEricSir: Wait, so this isn't about Ron Paul?

Oh right, he didn't actually fool anyone who matters.


You're a year late to the game, sparky.
 
2013-01-25 07:25:08 PM
dealbreaker.com

"Free Markets Can Regulate Themselves"

LOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOLOThanks for this great recession, asshole.
 
2013-01-25 07:41:49 PM

worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.


What? People just read too much into it. It's just an illustration of a common sense idea.
 
2013-01-25 08:06:17 PM

jvl: No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore. Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.


The problem with austerity is what they choose to cut. It's always something that punishes the poor and middle classes. And why? They didn't crash the economy.

Howabout Proscription instead. It's just as good as austerity and will probably get better results.
 
2013-01-25 08:09:04 PM

Wangiss: Most serious leftist Keynesians accept the Laffer curve,


The only thing anyone accepts about the Laffer curve is that revenue will be the same if taxes are at 0% or 100%.

Fortunately, taxes are NEVER going to be set at either of those rates, making the curve a rather useless assertion.
 
2013-01-25 08:13:20 PM

LoneWolf343: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

What? People just read too much into it. It's just an illustration of a common sense idea.


It's a graph with no numbers on it! It says that if you increase taxes too much, revenues will decline but it doesn't say at what tax level and under what psychological, political or economic circumstances this might happen.

And to the best of my knowledge none of the cargo cultists who believe the Sun and the Moon shine out of Laffer's butt have ever done the research to figure out at what level this might happen in the real world rather than on a cocktail napkin.

All we know is that when the top marginal rate was over 90% in the 1950s, it did not happen. The Truman and Eisenhower administrations were able to pay off the trillion dollar cost of World War II and it did not happen.
 
2013-01-25 08:14:34 PM

Ishkur: Wangiss: Most serious leftist Keynesians accept the Laffer curve,

The only thing anyone accepts about the Laffer curve is that revenue will be the same if taxes are at 0% or 100%.

Fortunately, taxes are NEVER going to be set at either of those rates, making the curve a rather useless assertion.


The curve isn't an assertion. It's an illustrated derivation of established economic definitions. Its utility is admittedly exaggerated on a regular basis.
 
2013-01-25 08:20:45 PM

Wangiss: Ishkur: Wangiss: Most serious leftist Keynesians accept the Laffer curve,

The only thing anyone accepts about the Laffer curve is that revenue will be the same if taxes are at 0% or 100%.

Fortunately, taxes are NEVER going to be set at either of those rates, making the curve a rather useless assertion.

The curve isn't an assertion. It's an illustrated derivation of established economic definitions. Its utility is admittedly exaggerated on a regular basis.


I take that back. Economic theories are assertions, so you're technically correct: the best kind of correct.
 
2013-01-25 08:26:11 PM

Wangiss: The curve isn't an assertion. It's an illustrated derivation of established economic definitions. Its utility is admittedly exaggerated on a regular basis.


Hey, economics threads are neither the time nor the place to be pedantic.
 
2013-01-25 08:29:32 PM

HailRobonia: Moist von Lipwig


Congratulations! You have won the Internets. In order to process your prize, we must file a prize winner report with the Government of Luxembourg. To expedite this, please send a cheque for $2,500 made out to CASH to us at Internets Prize Committee care of Brantgoose. You will receive your prize and a refund cheque within six months, plus lots of valuable coupons for your trouble.
 
2013-01-25 08:31:24 PM

brantgoose: It's a graph with no numbers on it! It says that if you increase taxes too much, revenues will decline but it doesn't say at what tax level and under what psychological, political or economic circumstances this might happen.


I've got an idea for a new economic model I call "Vacuum-Up Economics". It involves giving lots and lots of money to poor people. They immediately go out and spend it, and the money slowly trickles its way back up to the rich people (ie: it gets sucked back up like a vacuum).

Can someone please draw a bell graph to make my economic system all officialized and sound, so that it can be picked up and used as federal policy? That would be keen.
 
2013-01-25 08:32:47 PM
He told the people what they want to hear, instead of what they need to hear. Naturally he became an instant authority on all things economic.

/and that's why you shouldn't trust authoritarians
 
2013-01-25 08:53:26 PM

Tatterdemalian: instead of what they need to hear.


What they need to hear is that people well get to work growing the economy. Austerity fixes nothing long term because it doesn't actually address the root cause of the problem, a lack of economic growth.
 
2013-01-25 09:01:40 PM
dealbreaker.com

"You should totes get in on this here housing boom, man, son!" -- Alan Greenspan, 2006
 
2013-01-25 09:38:30 PM
s13.postimage.org
 
2013-01-25 09:41:08 PM

jvl: No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore. Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.


That can only can work if other countries you trade with have strong economies, you have you own currency. Last time I checked other European economies are in the shi*ter. Portugal doesn't have it's own currency. All you'll accomplish bagging your own economy which results in less tax revenue and more government debt, not less. It's like money is tight, so to save money you decide to only work only four days a week in order to save on gasoline and car maintenance.

Also the only government in Europe that overborrowed is Greece.
 
2013-01-25 09:41:55 PM

WhyteRaven74: Tatterdemalian: instead of what they need to hear.

What they need to hear is that people well get to work growing the economy. Austerity fixes nothing long term because it doesn't actually address the root cause of the problem, a lack of economic growth.


What if the government is taking money out of the private sector and just giving it away to people in other countries, or spending it on bullshiat with no economic multiplier like killing foreigners with foreign-made weapons?
Wouldn't that be a spending problem instead of a growth problem? In a case like that, wouldn't it make sense for the government to cut taxes and spending and allow business to multiply?
 
2013-01-25 10:08:33 PM

WhyteRaven74: What they need to hear is that people well get to work growing the economy.


There you go again, confusing "want to hear" with "need to hear." What if nobody is actually getting back to work? Will telling them people are getting to work, even though they aren't, fix the economy? North Korea has tried that for decades, even turned their entire capital city into one giant Potemkin Village... and it still isn't working.

So what to do? Send the army out to stand over the workers and MAKE them work at gunpoint? Every Communist nation that ever existed has tried that at some point, without much success. Only China and Vietnam can claim limited success, and then only after they stopped trying to force workers to operate at gunpoint and started letting them keep some of the profits of their work, as a limited experiment in capitalism.

Maybe you could declare a war, somewhere, and gin up enough nationalist fervor to get everyone willing to work long hours for little or no pay. Hitler and Mussolini tried that. It didn't end well for them. You could argue that it went badly for Hitler for entirely unrelated reasons, but Il Duce doesn't really have that excuse.

Face it, nobody's going to work if you won't let them benefit from it in a personal, not communal or national, way. The Greek government has made and broken so many promises you won't be able to get anyone to pay taxes at gunpoint, pretty much the whole nation will rise up and riot if anyone tries. In retrospect, promising cradle-to-grave social benefits while refusing to collect any tax money to pay for those benefits was probably not a good idea, no matter how easy it was to win an election doing that, but it's a little late to take the promises back. All that can be done is cut all the losses, break all the promises, and suffer the austere consequences.

/or keep telling lies and hope for a miracle from God
//I'm sure that will work out great for you
 
2013-01-25 11:20:37 PM
The fake economist who conned an entire nation. Shockingly, not about Paul Krugman Milton Friedman

ftfy
 
2013-01-25 11:21:59 PM

jvl: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

I hear this argument a lot on Fark. That doesn't make it true.

No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore.  Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.


austerity is really a moral response to the evils of debt.
 
2013-01-26 12:50:27 AM

brantgoose: LoneWolf343: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

What? People just read too much into it. It's just an illustration of a common sense idea.

It's a graph with no numbers on it! It says that if you increase taxes too much, revenues will decline but it doesn't say at what tax level and under what psychological, political or economic circumstances this might happen.

And to the best of my knowledge none of the cargo cultists who believe the Sun and the Moon shine out of Laffer's butt have ever done the research to figure out at what level this might happen in the real world rather than on a cocktail napkin.

All we know is that when the top marginal rate was over 90% in the 1950s, it did not happen. The Truman and Eisenhower administrations were able to pay off the trillion dollar cost of World War II and it did not happen.


What did I just say about reading too much into it? It's just saying "if you have no tax, you will get no tax revenue, and if you tax 100%, nobody will want to want to do business in your jurisdiction, and so you get no tax revenue there, either. Ergo, the ideal tax rate is somewhere in the middle." There are no numbers on it because nobody has crunched the numbers. Laffer himself has said as much, and you would have known that if you read the Wiki article like I did. In fact, he refuses to take credit for it, citing a couple other economists, including Keynes, for the idea. The people who try to analyze it miss the point, and those who disregard it entirely miss the point. It's not supposed to apply to top marginal tax rate alone, and it's not supposed to apply to any practical situation at all. It was just doodle that Laffer made to make a point.
 
2013-01-26 12:51:14 AM

Bucky Katt: jvl: Muta: Being against the austerity cuts makes him a better economist than all the "real" economists who think the cuts will help Portugal.

I hear this argument a lot on Fark. That doesn't make it true.

No economist thinks austerity helps an economy. Instead, it is a way for countries which have overspent and overborrowed to get their shiat together instead of going bankrupt. Sorry, Mommy isn't here to pay your bills for you anymore.  Going bankrupt is not an option since that involves being unable to borrow any money so you have to cut back even harder.

austerity is really a moral response to the evils of debt.


Funny how far we come when we call starving the poor a "moral response."
 
2013-01-26 01:22:50 AM

Ishkur: Hey, economics threads are neither the time nor the place to be pedantic.


ok...that made me laugh

/B.S. Econ.
 
2013-01-26 01:45:46 AM

LoneWolf343: Funny how far we come when we call starving the poor a "moral response."


It's more moral than starving the poor while loudly declaring the poor can't be starving, because the government won't let them starve.

/insult to injury, you know
 
2013-01-26 01:59:44 AM
How can you be a "fake" economist?

Isn't it just rampant speculation about how the economy works?

I mean sure, you might twist some data to support your speculation, but its ALL made up.
 
2013-01-26 02:10:02 AM

I sound fat: How can you be a "fake" economist?
Isn't it just rampant speculation about how the economy works?
I mean sure, you might twist some data to support your speculation, but its ALL made up.


No. Here's my standard disclaimer whenever someone questions the validity of economics and economists:

First of all, yes it's true that nobody knows how the economy fully works. At least, not with crystal clarity.

The laws of economics are constructs invented by man to explain, predict and record collective human behavior. What that means is that economics is a number-crunching science much like physics, filling in values and numbers and formulas in an impossibly massive equation. Unlike physics, however, the mathematics of economics don't always work the way we think they will because, after all, they are subject to human farking behavior.

So we don't actually know what that equation looks like. We have general ideas of what parts of it look like and how it operates, but no one understands the complete, big picture to mathematical clarity, such that when we make small adjustments to the equation like changing interest rates or deregulating investment brackets, the results surprise us. Because they're almost nothing like what we predicted would happen. Not even supply and demand works the way it should.

Economics is simultaneously a hard and soft science. The changes people make to the great economics algorithm are always blind, usually self-serving, and won't work the same way forever.

There are men who come forth every now and then -- Taylor, Say, Keynes, Friedman, Rothsbard, Greenspan, etc -- who propose theories and write treatises on how to manipulate the equation to make good things happen, and people put these theories to the test...and the theories always get things temporarily right and partly wrong, but no theory ever gets it completely right.
 
2013-01-26 02:38:38 AM

mr lawson: Ishkur: Hey, economics threads are neither the time nor the place to be pedantic.

ok...that made me laugh

/B.S. Econ.


Yeah, that's championship funny in my book.
 
2013-01-26 03:15:13 AM

Cagey B: garandman1a: Unfortunately Krugman did fool the entire planet at one time. Saying he is a tool is disrespectful of actual tools, which do useful things for society.

Please explain why Paul Krugman is generally wrong and how specifically he "fooled the entire planet". I'm interested in the perspective that your no-doubt intensive training in economics has granted you in this matter.


So you you admit you've never read his column? You know, the one that combines the Wizard of Oz with Deep Throat, featuring Obama?
 
2013-01-26 03:17:56 AM
So you youadmit you've never read his column? You know, the one that combines the Wizard of Oz with Deep Throat, featuring Obama?
 
2013-01-26 07:39:36 AM

GoodOmens: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

The laffer curve exists - what's hard/next to impossible to predict is where we are on the curve. Any economist who claims to know is lying.


So... if you've got a model, but it's overly simplistic and impossible to actually use in practice, how's that better than just not having a model?
 
2013-01-26 11:03:27 AM

CowardlyLion: GoodOmens: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

The laffer curve exists - what's hard/next to impossible to predict is where we are on the curve. Any economist who claims to know is lying.

So... if you've got a model, but it's overly simplistic and impossible to actually use in practice, how's that better than just not having a model?


You can easily say that about anything in economics. It's all one giant guess.

Remember it's all based on a study of two lines intersecting ;)
 
2013-01-26 11:04:11 AM

CowardlyLion: GoodOmens: worlddan: Did not read the article but it should be this man:

http://en.wikipedia.org/wiki/Laffer_curve

what a laugh.

The laffer curve exists - what's hard/next to impossible to predict is where we are on the curve. Any economist who claims to know is lying.

So... if you've got a model, but it's overly simplistic and impossible to actually use in practice, how's that better than just not having a model?


It isn't "impossible to use in practice." Obama's advisers consider it just like Bush's and Clinton's did. They don't make the same judgment calls, but it's part of every practicing economist's conscious decision-making process. Every administration wants to maximize effectiveness of tax policy.
 
2013-01-26 01:20:29 PM

Wangiss: It isn't "impossible to use in practice.


Actually, it can't be used in practice because it's only supposed to be a simple, non-specific sweeping generalization of taxes and revenues using polar opposite extremes to accentuate the bell curve. But it doesn't have the substance to construct an entire economic platform around. The Laffer Curve is woefully inefficient at differentiating the various types of taxes, the additive value of each (and their role at the federal/state/municipal level), and other nitty gritty stuff. It just doesn't go there. Implementing actual tax strategy is far more complicated than the Laffer Curve lets on.

So while it is true, it's only true insomuch as it's a philosophical theory. It has no practical application beyond that.
 
2013-01-26 01:24:49 PM

Ishkur: Economics is simultaneously a hard and soft science.


If any part of it is "soft," the whole thing is "soft." You're not doing economists any favors by pretending there's a part of economics that's "hard science," you're just trying to make them meet a standard that they literally can't meet, and will only earn further derision for trying.

The fact is there are two things that affect the entire human race, reality and imagination. Both can kill you stone cold dead, so both are important enough to be worth scientific study. Each one operates under completely different rules and restrictions, though, and even the techniques used to study one are practically worthless for studying the other ("hard science" for studying reality, and "soft science" for studying imagination). Economics is one aspect of the study of the imaginary side, and money is how we attach numbers to it so it can be measured. Unfortunately, the only solid fact in the imaginary side is that it changes constantly and unpredictably. Worse, forming a theorem inevitably leads to people trying to imagine ways to subvert it, leading to every other fact eventually becoming false no matter how obviously true it was when it was developed.
 
2013-01-26 01:57:57 PM

Tatterdemalian: Economics is one aspect of the study of the imaginary side


No.

Economics is the study of who gets what (while politics is the study of "how"). Fundamentally, it is the distribution, consumption, transaction and allocation of finite quantities. In its purest essence, economics is the study of abundance and scarcity within the application of human societies. So it is very real, it is very measurable, and it is very mathematical in its purest form. But not always, and not all the time.

Just because we've placed layers of abstraction upon it does not change what it is.
 
2013-01-26 02:43:13 PM
Ishkur, you declare it can't be used, then you explain its deficiencies. But it is used by economists regularly. Did you mean to say it Shouldn't be used?
 
2013-01-26 03:13:59 PM
This is about Laffer, right?
 
2013-01-26 04:00:09 PM

Tatterdemalian: What if nobody is actually getting back to work?


What jobs should they be getting back to? That whole lack of economic growth thing has meant there aren't jobs for them to go to.
 
2013-01-26 04:18:16 PM

phartman: Cagey B: garandman1a: Unfortunately Krugman did fool the entire planet at one time. Saying he is a tool is disrespectful of actual tools, which do useful things for society.

Please explain why Paul Krugman is generally wrong and how specifically he "fooled the entire planet". I'm interested in the perspective that your no-doubt intensive training in economics has granted you in this matter.

So you you admit you've never read his column? You know, the one that combines the Wizard of Oz with Deep Throat, featuring Obama?


Hey look, another person with no clue as to what the hell they're talking about. Go ahead, throw out an actual policy issue you have with Krugman. I'll wait.
 
2013-01-26 04:22:58 PM

CowardlyLion: So... if you've got a model, but it's overly simplistic and impossible to actually use in practice, how's that better than just not having a model?


Well especially since economists have tried to draw some correlation between taxes rates and economic growth rates for various countries and they don't find anything. I suspect it's because of substitution effects, you pay the government $250/mo for health insurance instead of a private insurance company economically there is no real difference. Instead of a billionaire buying a $100 million yacht, the government builds an $100 million fighter plane (both equally useless)
 
2013-01-26 05:11:31 PM

Ishkur: Tatterdemalian: Economics is one aspect of the study of the imaginary side

No.

Economics is the study of who gets what (while politics is the study of "how"). Fundamentally, it is the distribution, consumption, transaction and allocation of finite quantities. In its purest essence, economics is the study of abundance and scarcity within the application of human societies. So it is very real, it is very measurable, and it is very mathematical in its purest form. But not always, and not all the time.

Just because we've placed layers of abstraction upon it does not change what it is.


And what it is, is still imaginary. Abundance and scarcity are imaginary concepts not necessarily related to actual quantities. People will treat prized items as scarce no matter how many have been hoarded, and will consider low-valued items abundant even after they are entirely consumed, prefering to assume someone has stolen or sabotaged the supply rather than adjusting to its scarcity.
 
2013-01-26 08:55:26 PM

Ishkur: brantgoose: It's a graph with no numbers on it! It says that if you increase taxes too much, revenues will decline but it doesn't say at what tax level and under what psychological, political or economic circumstances this might happen.

I've got an idea for a new economic model I call "Vacuum-Up Economics". It involves giving lots and lots of money to poor people. They immediately go out and spend it, and the money slowly trickles its way back up to the rich people (ie: it gets sucked back up like a vacuum).

Can someone please draw a bell graph to make my economic system all officialized and sound, so that it can be picked up and used as federal policy? That would be keen.


Wealthy people tend to do the best at leveraging to grow their wealth. So when you give easy credit to anyone the poor get a minor boost but that wealth aggregates towards the upper levels. Why do we have a growing disparity of wealth? Because we make it so easy for people to take on debt held by the rich folks.
 
2013-01-26 10:30:31 PM

Wangiss: Ishkur, you declare it can't be used, then you explain its deficiencies. But it is used by economists regularly. Did you mean to say it Shouldn't be used?


I wouldn't say its economists that are using it.

This is what people think it looks like:
www.civitas.org.uk

This is what it actually looks like:
gapersblock.com

Until more metrics are added, it is functionally useless.
 
2013-01-26 10:36:47 PM

Tatterdemalian: And what it is, is still imaginary. Abundance and scarcity are imaginary concepts not necessarily related to actual quantities.


Oh, they're real alright. They are highly dependent upon human desires, which can change. But there are certain things that are fixed and everyone needs all the time (food, clothing, warmth, shelter, security, socializing, peer acceptance, self actualization, etc..). Where there is abundance of these things, there is usually sharing and commercial activity (trade is always surplus for surplus). When there is scarcity, there is always conflict (war is always have-nots vs haves).

Now, you may go ahead and say these things are imaginary, but it would be a highly dubious position.
 
2013-01-26 10:38:58 PM

Mrbogey: Wealthy people tend to do the best at leveraging to grow their wealth. So when you give easy credit to anyone the poor get a minor boost but that wealth aggregates towards the upper levels. Why do we have a growing disparity of wealth? Because we make it so easy for people to take on debt held by the rich folks.


Actually, it's because it's easier to make money when you have money. Money likes to attract itself.

Turning $10 into $100 is skill.
Turning $10 million into $100 million is inevitable.
 
2013-01-27 12:20:59 AM

Ishkur: Oh, they're real alright. They are highly dependent upon human desires, which can change. But there are certain things that are fixed and everyone needs all the time (food, clothing, warmth, shelter, security, socializing, peer acceptance, self actualization, etc..). Where there is abundance of these things, there is usually sharing and commercial activity (trade is always surplus for surplus). When there is scarcity, there is always conflict (war is always have-nots vs haves).

Now, you may go ahead and say these things are imaginary, but it would be a highly dubious position.


Only because you seem to think the term "imaginary" is some kind of pejorative. Reality is that which does not change based on what people believe, everything else is imaginary. Volume, mass, and distance are real; abundance, scarcity, and the values derived from them are not.

/think the "imaginary" units of complex numbers
//they still have an effect on mathematical models, even though the square root of a negative number, by definition, shouldn't actually exist
 
2013-01-27 12:43:41 AM

Ishkur: Wangiss: Ishkur, you declare it can't be used, then you explain its deficiencies. But it is used by economists regularly. Did you mean to say it Shouldn't be used?

I wouldn't say its economists that are using it.

This is what people think it looks like:
[www.civitas.org.uk image 600x500]

This is what it actually looks like:
[gapersblock.com image 663x600]

Until more metrics are added, it is functionally useless.


+1 for hilarity. Thank you and goodnight.
 
2013-01-27 12:46:17 AM

Ishkur: Mrbogey: Wealthy people tend to do the best at leveraging to grow their wealth. So when you give easy credit to anyone the poor get a minor boost but that wealth aggregates towards the upper levels. Why do we have a growing disparity of wealth? Because we make it so easy for people to take on debt held by the rich folks.

Actually, it's because it's easier to make money when you have money. Money likes to attract itself.

Turning $10 into $100 is skill.
Turning $10 million into $100 million is inevitable.


Right...and easy credit and inflated money supply helps it along.
 
2013-01-27 03:44:10 AM

Tatterdemalian: Only because you seem to think the term "imaginary" is some kind of pejorative.


Well, you seem to use it in the context of "does not exist".

Reality most certainly exists, and economics is based on it. It would not function otherwise.

I think a better term you should use is "abstract conceptualization", which are things humans invent as placeholders to describe, explain, classify and categorize the way we observe the natural world and its properties. Do these demarcations exist in nature? ...probably not, but we have no way of actually knowing for sure. This is a solipsist tangent -- down a lonely and dangerous path this thinking lies.

Summed up: Your argument is philosophical and hence impractical, to say the least.
 
2013-01-27 03:45:25 AM

Mrbogey: Right...and easy credit and inflated money supply helps it along.


Credit and money supply have absolutely nothing to do with it.
 
2013-01-27 07:06:34 PM

I sound fat: How can you be a "fake" economist?

Isn't it just rampant speculation about how the economy works?

I mean sure, you might twist some data to support your speculation, but its ALL made up.


No, economics is just a social science -- hard to describe w/o tons of caveats.  But at least mainstream economics does have some explanatory power backed by mathematical modeling and accompanied by empirical evidence (i.e. uses the scientific method, albeit to something that's not a natural science so it's mucky).

Austrian School economics OTOH -- the school preferred by self-proclaimed libertarians -- is based on a priori ("I know it's so because I know it's so; no empirical evidence needed") reasoning, doesn't use mathematical modeling, doesn't give a rat's ass whether its theories can be tested, and is the social science version of Intelligent Design. "It worked, therefore more laissez-faire. It didn't work, therefore more laissez-faire."
 
2013-01-27 10:57:10 PM

gameshowhost: I sound fat: How can you be a "fake" economist?

Isn't it just rampant speculation about how the economy works?

I mean sure, you might twist some data to support your speculation, but its ALL made up.

No, economics is just a social science -- hard to describe w/o tons of caveats.  But at least mainstream economics does have some explanatory power backed by mathematical modeling and accompanied by empirical evidence (i.e. uses the scientific method, albeit to something that's not a natural science so it's mucky).

Austrian School economics OTOH -- the school preferred by self-proclaimed libertarians -- is based on a priori ("I know it's so because I know it's so; no empirical evidence needed") reasoning, doesn't use mathematical modeling, doesn't give a rat's ass whether its theories can be tested, and is the social science version of Intelligent Design. "It worked, therefore more laissez-faire. It didn't work, therefore more laissez-faire."


As a social scientist, your silly claim of one economic model/school being more scientific than another amuses me greatly.
 
2013-01-28 09:04:07 AM

Wangiss: As a social scientist, your silly claim of one economic model/school being more scientific than another amuses me greatly.


To be fair, the Austrian School seems to be irresistibly attractive to libertarians who can't pass Calculus.
 
2013-01-28 12:59:55 PM

Ishkur: Wangiss: As a social scientist, your silly claim of one economic model/school being more scientific than another amuses me greatly.

To be fair, the Austrian School seems to be irresistibly attractive to libertarians who can't pass Calculus.


Change in acceleration goes where?
 
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