Posted on 06/10/2011 5:00:20 PM PDT by Kaslin
It's a cliche — but true — that a huge obstacle to a stronger economic recovery is the lack of confidence in a strong recovery.
If consumers and businesses were more confident, they would be spending, hiring and lending more freely. Even a slight relaxation might do wonders for the subpar nature of the expansion, highlighted by May's meager 54,000 increase in payroll jobs.
Instead, we're deluged with reports suggesting that, because the recession was so deep, it will take many years to regain anything like the pre-crisis prosperity.
Just last week, the McKinsey Global Institute, research arm of the consulting firm, released a study estimating that the country needs 21 million additional jobs by 2020 to reduce the jobless rate to 5%. The study was skeptical it would happen. Ugh. Pessimism and slow growth become a vicious cycle.
Battered confidence most obviously reflects the ferocity and shock of the financial collapse and the ensuing recession, including the housing crash. But there's another, less-appreciated cause: disillusion with modern economics.
Probably without realizing it, most Americans had accepted the fundamental promises of contemporary economics. These were: first, we know enough to prevent another Great Depression; second, while we can't prevent every recession, we know enough to ensure sustained and, for the most part, strong recoveries. These propositions, endorsed by most economists, had worked themselves into society's belief structure.
(Excerpt) Read more at investors.com ...
First they reject our warnings and advice.
(mine, Tom Sowell’s others; I’m an economist...)
Then, when things go bad— they’re all like “Why didn’t you TELL me!” and “You guys suck!”
And the Marxist pretender occupying the Oval Office is the source of that disillusionment and pessimism.
http://dirtyspendingsecrets.com/
Rush just promoted this website. Take a peak and please share with as many as you can before they shut it down.
;” I’m an economist “
How could you be??
The word “unexpected” (or any variant thereof) did not appear anywhere in your three-line post...
(kidding..)
There was once a time when the laws of economics worked... Before the communists took over.
Wrong — most Americans were only told of Keynesian myths. If he were alive today, even Keynes would not be a Keynesian (he famously said that when the facts change, he changes his mind). Unfortunately, the Kenyan in the Oval Office is a Keynesian (or, a flat-out Marxist).
Yes, they rejected the warnings of Thomas Sowell, Ludwig Misses, and other free market economists. However, they may have embraced the thinking of such socialist economists as Krugman and Keynes. Samuelson goes on and says that new ideas may emanate from this crisis. That sounds reasonable, but I think it is wrong. The right answers are out there; many choose to reject them. Socialism does not work. A politician or bureaucracy that "runs the country," can only run it into the ground. Freer markets - lower taxes and less regulation - leads to prosperity.
Zer0’s turkeys are comin’ HOME, to ROOST!
Zer0's a Kenyanesian.
Yes, I am an Austrian/Sowell “school” economist. Also known as a well-trained economist.
;)
If the "promises of modern economics" include deficit spending at 1.6 trillion dollars per year, half of which is purchased by the Federal Reserve, then I will have to join the minority who consciously rejects such nonsense.
Sorry, Bob. The disillusionment isn’t with economics but with Obamanomics.
It’s quite simple, really. No one in their right mind is going to invest in U.S. economic growth as long as Marxists are in charge of the economy.
It makes no sense whatsoever to take additional risks to attempt to increase profits if those profits are simply going to be stolen by the government and “redistributed”, whether such redistribution occurs via Obamacare, increased taxes, increased regulation, deliberately increasing energy prices, deliberate destruction of the currency via insane inflationary policies, or deliberate destruction of the Constitution by ignoring it.
Anyone with any sense is simply hunkering down and trying to hold on to what they already have, trying to keep it from being stolen and redistributed. The best way to do that is to do nothing, that is, to limit all financial transactions, since government theft takes place during those transactions.
Business, economic growth, and jobs growth will begin again when the Marxists are replaced with a government that fosters a genuinely business-friendly environment. Until then, economic stagnation is a given.
After all, it’s now an Obama World, baby!
The sad truth about Keynes is that in his General Theory, he never explains how the economy works, so how can he understand how to repair it?
In truth, his General Theory is an attempt to justify allowing government to manipulate the value of money, all in an attempt to manage the economy so as to bring about a secular utopia.
You don’t have to read the whole thing to find this out, just scan the summary chapter. Strangely it can be found at a Marxist web site:
http://www.marxists.org/reference/subject/economics/keynes/general-theory/ch24.htm
see also:
Joseph Salerno, 1992. The Development of Keynes’s Economics: From Marshall to Millennialism.
Review of Austrian Economics 6, no. 1: 3–64, link to PDF:
http://mises.org/journals/rae/pdf/RAE6_1_1.pdf
I found the causal-rational economics of the Austrian school to be much more in harmony with real life. See: www.mises.org.
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