Posted on 06/21/2011 11:07:03 AM PDT by Qbert
What is wealth? Again I will go with Adam Smith in that when you get done, it generates more wealth. It is not the item it self but how it is used. Computers can generate more wealth but can also generate more bureaucracy.
It is also related to maturity of a family or govt. When you have easy wealth available, you will spend it foolishly, it is the nature of things. One generation earns it, the next spends it.
I have studied farm records for 30 years. The one bottom line I have is cash flow affects mgt more that mgt affects cash flow. If cashflow is tight I make better decisions, IF I win the lottery tomorrow, I make poor decisions. Which leads to the next discussion, what is the difference between wealth and cashflow?
“I find it quite interesting that lots of posters here are quite willing to post all about how government never creates wealth, but are shy about posting their definition of what is and is not wealth creation.”
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Simple time constraints, not shyness.
Personally, I don’t have the luxury of time to engage in an extended exchange on economic theory and application, or for that matter any number of subjects.
Maybe one day, with Mavis Bacon lessons, or better yet, Dragon Naturally Speaking.....
Sounds like we agree.
Still up here;
Transcript of Pelosi, House Democratic Leaders, and Economists’ Press Conference Following Economic Forum
http://www.realestaterama.com/2009/10/22/transcript-of-pelosi-house-democratic-leaders-and-economists%C3%A2%E2%82%AC%E2%84%A2-press-conference-following-economic-forum-ID06137.html
Speaker Pelosi. ...”I am pleased that we had the benefit of the thinking of Dr. Mark Zandi, Dr. Alan Blinder, Bob Kuttner, Heather Boushey, Bill Hambrecht, and Allen Sinai. You have their backgrounds. We will hear from them now.”
...Alan Blinder. I’d like to start with a short apology, which is I’m not going to run off from you, but I have an appointment across town at 1 o’clock so I have to leave in about 10 minutes. But what I want to say is this: the Congress and the Administration and the Federal Reserve have done already an enormously heavy lift in limiting what could have been a much worse economic outcome. That said, it’s pretty bad as it is right now.
On the consensus forecast, I’m a little bit more optimistic than Mark. My personal view is a little bit above consensus, but that’s a quibble. On the consensus forecast, the GDP is already growing, but jobs are still shrinking and are likely to shrink for a while yet and that makes it very hard for political leadership or for just economists to the extent that we talk to the public to persuade people that things are getting better because they don’t look like they are getting better when jobs are a) still so scarce and b) are even shrinking rather than arising. So for that reason, despite the fact that we’re looking at an absolutely horrendous long-term fiscal outlook, I, like Mark, and I think most of us around the table, believe that at least a modest, now this is where people will disagree, but at least a modest increase in the deficit is targeted very strongly on job creation. Not a scatter shot, but targeted very strongly on job creation would be appropriate.
I think this is a case where it is both good policy and good politics which you know is not always the case but in this instance it is the case. That said, we do have to be mindful of the long-run deficit problem. I have been taken recently in a number of venues to be quoting not quite correctly, paraphrasing St. Augustine who said something like, “Lord, make me chaste, but not just yet” We do need to become more chaste about the budget deficit, we do need to pay attention to the long-run fiscal hole, a lot of attention but in the short term, this is not the time to do it. 2009 and probably 2010 are not the times to do that.
One thing I spoke to the Members about knowing that it is very, very difficult to do, is to try to get some long-run commitment to greater fiscal responsibility while we are still trying to alleviate the job problem. I know this is a very, very difficult thing to do, I don’t think it is quite an impossible thing to do. I think it is really quite remarkable that this many Members of the congressional leadership show up and spend several hours with the likes of us, talking seriously about the economy. This little session we’re having right now notwithstanding, this was not a media event. We were behind closed doors and talking very, very frankly over a range of issues. I think that happens too little in Washington and it is a tribute to the Speaker and to the other Members that they took so much time out of their schedules to do this. I thank them.
Speaker Pelosi. “Thank you, Dr. Blinder”
“But if it’s not financed with higher taxes, and if it doesn’t drive up interest rates, it’s hard to see how it can destroy jobs.
—Uh...how is this spending paid for if not through higher taxes or borrowing (which raises interest rates)?”
I think he’s only looking at it in the short-term- that because, in his mind, Obama hasn’t “raised taxes” (even though he has in certain instances- the estate tax, for one) and because interest rates are artificially low, that everything should be hunky dory for creating jobs.
This of course neglects your valid point- at some point it will have to be paid back in some form, and it neglects to consider the dramatic currency devaluation that has occurred, which of course leads to rising commodities prices and eventually... job destruction.
You cannot spend your way out of debt.
A simple concept lost to so many!
Did you also attend Princeton?
Que?
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