Krugman On Morning Joe: "How Many Times Do I Have To Be Right?"

[SunsetSue]

I hope Obama and the Dems read Krugman's book:

Let us know when he's right in the real world, not the MSNBC Bernanke-verse.

[TheResearcher]

Monday Morning Quarterback...if he was a decent economist, he would have been able to predict what the sub-prime garbage that was shoved down the banks' throats in the name of diversity and poltical correctness was going to do to the economy and spoken out about it. But, since it was done by BJ Clinton, a Democrat, a fellow lyberal, it was okay.

[flyboy56]

False. They're facts that don't fit with your ideology so you dismiss them as religion. You're going by how you want things to be and not how they are. So when it gets pointed out that big government, whether desired or not, is a problem you do this.

Centralizing wealth and power in Washington is not turning out well. It is leading to corruption and an unresponsive and down right uncaring government. It may not have been the desired result of progressive policy but it is what they got. Throwing more government on top of it and expecting a different result is insane. That is not religion. That is reality. If something repeatedly doesn't work then trying it again while blindly hoping for a different result is not the solution. Trying it again is the problem.

Thank goodness Government determines who has the privilege to natural rights!

[Phineas Finn]

False. They're facts that don't fit with your ideology so you dismiss them as religion. You're going by how you want things to be and not how they are. So when it gets pointed out that big government, whether desired or not, is a problem you do this.

Centralizing wealth and power in Washington is not turning out well. It is leading to corruption and an unresponsive and down right uncaring government. It may not have been the desired result of progressive policy but it is what they got. Throwing more government on top of it and expecting a different result is insane. That is not religion. That is reality. If something repeatedly doesn't work then trying it again while blindly hoping for a different result is not the solution. Trying it again is the problem.

Amazing.

You continue to offer opinion as fact -- that's faith, not reality.

"Centralizing wealth and power in Washington is not turning out well. It is leading to corruption and an unresponsive and down right uncaring government." -- that's not a fact; that's an opinion.

You make blanket statements about how government "doesn't work" -- that's not realtiy; that's a statement of your faith.

You use phrases that mean nothing outside of the church of right-wing ideology. For example: "Throwing more government of top of it." Continuing efforts to solve problems is not "Throwing more government"; it's continuing to work at a job that's not done.

If your boat is leaking, looking for a larger bucket to bail with is logical, not insanely continuing something that doesn't work.

[SemiAuto]

Amazing.

You continue to offer opinion as fact -- that's faith, not reality.

"Centralizing wealth and power in Washington is not turning out well. It is leading to corruption and an unresponsive and down right uncaring government." -- that's not a fact; that's an opinion.

You make blanket statements about how government "doesn't work" -- that's not realtiy; that's a statement of your faith.

You use phrases that mean nothing outside of the church of right-wing ideology. For example: "Throwing more government of top of it." Continuing efforts to solve problems is not "Throwing more government"; it's continuing to work at a job that's not done.

If your boat is leaking, looking for a larger bucket to bail with is logical, not insanely continuing something that doesn't work.

Yet I back up my position with facts that you conveniently ignore to stick with ideology. Your bait and switch here is obvious. You ignore facts to avoid conclusions. You then deem the conclusions to be faith based because you refuse to address the facts.

The complaint that austerity is bad fails to acknowledge that the austerity being practiced is mostly cuts in the increase in spending and higher taxes and not the kind of 'draconian' cuts. That is a fact. If you wish to ignore that to stick with a false conclusion then it is you who are operating on faith.

The claim that austerity defined by actual fiscal restraint cannot have a good outcome is proven false by the results in Canada. Yet this fact is ignored to avoid the conclusion. That is your faith trumping reality, not mine.

You say there is no point in arguing against 'religion' then maybe you should stop arguing religion.

Some more inconvenient facts:

Liberals were also quick to blame alleged spending cuts. Jared Bernstein — a former Obama economic advisor — complained that "austerity at (a) time when we need a fiscal push" is the problem.

"Congress is applying medieval techniques," he wrote, "bleeding the patient while ignoring the indicators both here and abroad as to how that's working."

An interesting theory. Except that while the BEA says defense spending declined in Q4, overall federal spending was up $31 billion compared with Q4 2011 and up $98 billion compared with Q3 2012, according to monthly spending reports out of the Treasury Department.

And even assuming that the "huge cuts" from the sequester go through, spending this year will be about $570 billion higher than in 2008, and will consume 22.4% of GDP — a level reached only four times in the 63 years before Obama.

So maybe it's the lack of adequate stimulus?

Perhaps, but only if you ignore the Fed's massive ongoing pump-priming efforts, and the fact that the deficit in Q4 alone topped $292 billion — nearly double the deficit for all of 2007.

source

That is an awfully religious notion of austerity. Spending went up and stimulus continued. The results are lackluster. This is fact, not opinion, not religion.

[reg_indy]

Monday Morning Quarterback...if he was a decent economist, he would have been able to predict what the sub-prime garbage that was shoved down the banks' throats in the name of diversity and poltical correctness was going to do to the economy and spoken out about it. But, since it was done by BJ Clinton, a Democrat, a fellow lyberal, it was okay.

http://losangeles.legalexaminer.com/...oogleid=242468

[flyboy56]

Like the deficit reduction war is anything new.

NEWS
Bush Formally Warns of Budget Cuts on Oct. 1 : Deficit: Notification of Gramm-Rudman slashes puts pressure on negotiators. Analysts see the move as symbolic.

August 21, 1990 | JAMES RISEN, TIMES STAFF WRITER
The Bush Administration formally served notice that it will have to impose mandatory budget cuts in many key federal programs starting Oct. 1 unless White House and congressional negotiators reach agreement on a budget accord. The Office of Management and Budget warned that, in order to avoid such cuts, the budget deficit must be reduced by between $85.4 billion and $105.7 billion--a figure that is $35 billion to $55 billion more than negotiators have publicly said is politically feasible.

[SemiAuto]

If there is a deficit reduction war then deficit reduction lost.

[Phineas Finn]

Yet I back up my position with facts that you conveniently ignore to stick with ideology. Your bait and switch here is obvious. You ignore facts to avoid conclusions. You then deem the conclusions to be faith based because you refuse to address the facts.

The complaint that austerity is bad fails to acknowledge that the austerity being practiced is mostly cuts in the increase in spending and higher taxes and not the kind of 'draconian' cuts. That is a fact. If you wish to ignore that to stick with a false conclusion then it is you who are operating on faith.

The claim that austerity defined by actual fiscal restraint cannot have a good outcome is proven false by the results in Canada. Yet this fact is ignored to avoid the conclusion. That is your faith trumping reality, not mine.

You say there is no point in arguing against 'religion' then maybe you should stop arguing religion.

Some more inconvenient facts:


source

That is an awfully religious notion of austerity. Spending went up and stimulus continued. The results are lackluster. This is fact, not opinion, not religion.

You offer as "fact" an IBD editorial. You continue to claim that the Canadian example supports your claims when others disagree as to how "successful" Canada's austerity has been. And worst of all, you continue to quote numbers showing an increase in government spending as a percentage of GDP while ignoring the fact that recession contributes to that increased percentage.

Bottom line: If an economy is already suffering from a shortfall in demand, as the U.S. is today, cutting demand further through fiscal austerity can make matters worse, not better.

http://www.businessweek.com/articles...or-u-dot-s-dot

The opinion piece quoted above lists several factors specific to Canada that the author believes contributed to Canada's positive results.

[flyboy56]

If there is a deficit reduction war then deficit reduction lost.

It is a war and so far I cannot find one battle in this war where deficit reduction has actually seen a permanent peace (0 Balanced budget) settlement between both parties.

[flyboy56]

"Bottom line: If an economy is already suffering from a shortfall in demand, as the U.S. is today, cutting demand further through fiscal austerity can make matters worse, not better." Phineas Finn

This is what happens when you just keep kicking the can down the road. And do you really think anything would change if we ever get our economy back strong again? I'm sorry to say it will only reinforce those believers who say deficits don't hurt an economy. These people need a damn good spanking to show them the light.

[SemiAuto]

You offer as "fact" an IBD editorial.

Just stop.

Fact: "Except that while the BEA says defense spending declined in Q4, overall federal spending was up $31 billion compared with Q4 2011 and up $98 billion compared with Q3 2012, according to monthly spending reports out of the Treasury Department."

Fact: "And even assuming that the "huge cuts" from the sequester go through, spending this year will be about $570 billion higher than in 2008, and will consume 22.4% of GDP..."

Fact: "Perhaps, but only if you ignore the Fed's massive ongoing pump-priming efforts, and the fact that the deficit in Q4 alone topped $292 billion — nearly double the deficit for all of 2007."

You continue to claim that the Canadian example supports your claims when others disagree as to how "successful" Canada's austerity has been. And worst of all, you continue to quote numbers showing an increase in government spending as a percentage of GDP while ignoring the fact that recession contributes to that increased percentage.

Yet historically spending has gone up almost non-stop. That is a fact.

http://www.businessweek.com/articles...or-u-dot-s-dot

The opinion piece quoted above lists several factors specific to Canada that the author believes contributed to Canada's positive results.

Take the first example:

• In Canada, austerity helped lower interest rates. Rates are already super-low in the U.S., so there’s no room to improve.

US interest rates are being kept artificially low by the actions of the Federal Reserve. So in short, the argument here is that austerity won't work because of the interventions of the Fed.

Take the second example:

• In Canada, austerity lowered the value of the Canadian dollar, which made Canadian goods more competitive on world markets. The U.S. is a relatively self-sufficient economy, so it would benefit less from a depreciation, even if one occurred.

Ironically enough, the US dollar is losing value due to....

... wait for it...

...actions from the Federal Reserve. Specifically quantitative easing. SSDD.

• Canada benefited from growing demand for its products from the U.S. and China, which compensated for the chilling affect of deficit reduction. No countries today are eager to soak up more imports from the U.S.

This has more to do with globalization than anything else.

• Canada is indeed an exception. An International Monetary Fund study looked at 172 fiscal policy changes in rich countries and found that on average, reducing the budget deficit by 1 percent of GDP reduced output by two-thirds of a percent and boosted the unemployment rate by one-third of a percent.

The 800 lbs gorilla in the room here is that the US is running budget deficits that are outpacing growth. The reality based conclusion should be that running deficits are not working (see the FACTS above).

Bottom line: If an economy is already suffering from a shortfall in demand, as the U.S. is today, cutting demand further through fiscal austerity can make matters worse, not better.

Yet what is causing the shortfall in demand? Price/asset misallocation (inflationary bubbles) and too much leverage. These problems are not helped by deficit spending and quantitative easing. Just the opposite. This problem is increased by it yet that is the policy of the government.

[flyboy56]

So who really is benefitting from the QE's, ZIRP, stimulus and continued deficits? They say follow the money if you want to catch the crooks. Who is really benefitting from all of this easy money?

http://www.economonitor.com/blog/201...ics-of-choice/

[SemiAuto]

So who really is benefitting from the QE's, ZIRP, stimulus and continued deficits? They say follow the money if you want to catch the crooks. Who is really benefitting from all of this easy money?

Wall Street.

http://www.economonitor.com/blog/201...ics-of-choice/

Be prepared to have this dismissed as religion.

[flyboy56]

One of the reasons for QE and ZIRP:

"It forces existing investors to keep rolling over debt to avoid realising currency losses on their investments. It encourages existing investors to increase investment, to “double down” to lower their average cost of US dollars and US government debt. As John Connally, US Treasury Secretary under President Nixon belligerently observed: “Our dollar, but your problem.”

[flyboy56]

The US is in a currency war with the world. If you can't beat them with real money, you beat them by manipulating the US dollar. And the US has the borrowing and money printing advantages.