Free Republic

...Obama’s greatest adversary in the latest budget battle isn’t the Republican leadership in Congress — it’s his confidence in his own ability to force a win. He has been so certain of his campaign skills that he didn’t open a line of communication with House Speaker John Boehner and Senate Minority Leader Mitch McConnell until Thursday, a week before the spending ax hits. And when they did finally hear from Obama, the calls were perfunctory, with no request to step up negotiations or invitations to the White House. ...In the last two days alone, he’s courted local TV anchors, called...

Ideology is powerful, capable of masking unpleasant facts. Whether we recognize it or not, we are all slaves to ideology. Economists are no different in that regard than other people. They hold preconceived ideas which affect the interpretation of data and facts. In the extreme, ideology is capable of blocking the recognition of contradictory information, effectively blinding a person to valuable evidence. Keynesian economists believe, regardless of logic and data, that economies can be managed from the top down. In their world, economies are little different than machines. Change some inputs here, speed them up over there, add some lubrication,...

I agree that Obama inherited a crappy economy, and I think it is silly to assert that he bears any responsibility for the severity of the 2007-2009 recession. But it is very fair to hold him responsible for what’s happened since the recession ended. I’ve cited data from the Minneapolis Federal Reserve on both employment and gross domestic product to show that Obama has presided over the weakest recovery in the post-World War II period.And I think it is fair to blame Obama for the economy’s anemic performance during that time, largely because his agenda of faux stimulus and Obamacare...

Hurricane Sandy was an invader, one that splashed ashore with as much destructive power as any foreign (or perhaps interstellar) invader could hope to bring to bear against our coasts. Thus, in the opinion of economist Paul Krugman, the storm should help boost the American economy. “If we discovered that, you know, space aliens were planning to attack and we needed a massive buildup to counter the space alien threat and really inflation and budget deficits took secondary place to that, this slump would be over in 18 months,” the Nobel Prize winning economist declared on CNN in 2011....

The Great Recession was primarily caused by the collapse in economic demand as 80 million “baby-boomers” born between 1946 and 1964 moved out of their peak spending years in their mid-30s to mid-50s and into retirement in their late 50s and early 60s. The U.S. government over the last five years squandered $7.6 trillion on Keynesian demand-side stimulus trying to resuscitate this demographically shrinking demand. With only 23 million born between 1995 and 2012 that comprise “Generation Z”, this population is just too small for demand-side stimulus to revive the economy. America is now deep in debt, facing 23 million...

Does the employment of Keynesian economics actually spark the economy, or merely help those in office keep their jobs? Low interest rates: check. Tax breaks: check Deficit spending to stimulate the economy: check. Three primary tools in the Keynesian toolbox, used in significant doses in order to combat economic instability. For decades, they have been the central tenets utilized by various governments in numerous battles to stabilize the economy, up to and including the recent devastation wrought by the post-2008 financial crisis. In this latest iteration and via numerous efforts bookended by TARP and QE2, the United States has invested...

In country after country, increased government spending acted more like a depressant than a stimulant. - Policy makers in Washington and other capitals around the world are debating whether to implement another round of stimulus spending to combat high unemployment and sputtering growth rates. But before they leap, they should take a good hard look at how that worked the first time around. It worked miserably, as indicated by the table nearby, which shows increases in government spending from 2007 to 2009 and subsequent changes in GDP growth rates. Of the 34 Organization for Economic Cooperation and Development nations, those...

Keynesian (and some Monetarist) versus Austrian views on the business cycle revolve around two basic empirical issues: the nature of capital and production and the nature of the national budget constraint. Concerning capital: Ironically, Keynesians appear to assume a kind of “equilibrium always” story in which productive (human and physical) resources can, at low cost, be simply shifted to and plugged in to the production of whatever product or service happens to be the object of demand stimulus; and, further, that if enough of this is done, income, employment and tax-payments will rise precipitously. In this way economic-policy can produce...

I suspect the essentials of Keynesian economic theory were scribbled as a faculty prank on a monogrammed napkin in the Harvard Business School cafeteria. After a few laughs, the discarded joke was left on the table with empty coffee cups and a half-eaten bagel; only to be discovered minutes later by an opportunistic work-study sophomore clearing the table. The crumpled napkin was auctioned as the hottest & newest economic pop-theory to a fast-talking tabloid freelancer (who had been to Vegas with his columnist-buddy at The Globe, and had the goods on him). After some hard-nosed and expensive negotiations, the freelancer...

There’s no question that America’s recovery from the financial crisis has been disappointing. In fact, I’ve been arguing that the era since 2007 is best viewed as a “depression,” an extended period of economic weakness and high unemployment that, like the Great Depression of the 1930s, persists despite episodes during which the economy grows. And Republicans are, of course, trying — with considerable success — to turn this dismal state of affairs to their political advantage. They love, in particular, to contrast President Obama’s record with that of Ronald Reagan, who, by this point in his presidency, was indeed presiding...

CAMP DAVID, Md. — Leaders of the world’s wealthiest nations opened the door Saturday to more government spending in Europe as way to revive the continent’s struggling economy, shifting away from the idea that the surest way to recovery was through strict fiscal austerity. Meeting at the Group of Eight summit at Camp David, President Obama and his fellow leaders said they were committed foremost to creating jobs and growth, a shift, at least in emphasis, from previous gatherings dominated by German efforts to reduce high government debt through drastic fiscal reform. In a joint statement, the leaders of eight...

Stimulus: We've come to expect the worst from unduly influential New York Times columnist Paul Krugman. But this week he hit a new low by claiming President Reagan, not Obama, is the true big-government Keynesian.

According to Michael Kinsley, a gaffe is when a politician accidently tells the truth. That’s certainly what happened to Mitt Romney on Tuesday, when in a rare moment of candor — and, in his case, such moments are really, really rare — he gave away the game. Speaking in Michigan, Mr. Romney was asked about deficit reduction, and he absent-mindedly said something completely reasonable: “If you just cut, if all you’re thinking about doing is cutting spending, as you cut spending you’ll slow down the economy.” A-ha. So he believes that cutting government spending hurts growth, other things equal. The...

As we watch the Eurozone struggle with its financial challenges Keynesians keep telling us the solution to our economic problems is to spend more money, to pile up bigger debts. A week and a half ago, Standard & Poor’s downgraded the debt of more than half of the Eurozone's countries, and the failure of those policies should be very obvious by now. Solving the Greek debt crisis hit yet another snag on Sunday afternoon. New aid for Greece from the IMF, the European Commission and the European Central Bank would have relied on private bondholders “voluntarily” agreeing to a 50...

The Club for Growth wrote a white paper on Governor Romney back in 2007. Most of the information below is from that repory, but since Romney has been outspoken on several issues then, weve updated his record to reflect those positions. ...During his initial 2002 campaign Romney refused to sign an anti-tax pledge, but he pledged to balance the budget without raising taxes and touted his fulfillment of that pledge throughout his term. But the details suggest that he broke his verbal committment. Romney did not impose any broad-based tax hikes he imposed a slew of fee hikes. He opposed...

“The U.S. can pay any debt because we can always print more money.”–Alan Greenspan Meet the Press August 7, 2011 Last week, Nouriel Roubini released a paper, “A Radical Policy Response to the Rising Risks of a Depression and Financial Crisis.” He writes: “Data suggest that developed and emerging markets alike are heading for a massive slowdown in growth, with advanced economies already slumping to stall speed.” Roubini is right, but for the wrong reasons. Government intervention is the root cause of the financial crisis and the maladies identified by Roubini. Many of his proposals, such as debt restructuring and...

Pimco’s Mohamed El-Erian might like what he sees in President Barack Obama’s $447 billion jobs package but not Marc Faber, the author of the Gloom, Boom and Doom report, who is not happy about the President’s plan. The package is “another complete failure of Keynesian economics and corrupt interventions,” Faber

There are two facts about our current economic situation that can no longer be denied: Our economy is in desperate need of government stimulus, and our political system won’t abide any increase in our national deficit. Taken together, the two points seem to bode poorly for the United States. But we shouldn’t be too quick to assume a contradiction. Just because stimulus has traditionally been understood as a function of deficit-spending doesn’t mean that’s how it has to work. We first have to come to grips with the fact that we need stimulus because we’re facing a problem of inadequate...

Stocks rose in afternoon trading Friday after Federal Reserve Chairman Ben Bernanke said the U.S. is on track for long-term economic growth. Bernanke left open the possibility of more action by the Fed if another recession looks likely. But he announced no new economic stimulus measures during his speech at a conference in Jackson Hole, Wyo.

Amid bleak economic growth and unemployment, the stock market swoon, and the downgrade of the credit rating of the federal government, the fear of a dreaded double-dip recession--or even of a 21st-century Great Depression--has been taking hold. But a rough consensus among economists may be starting to emerge. According to this line of thinking, although a double-dip is certainly possible, a long period of stagnation--that is, frustratingly low growth--is more likely, much like what we've seen since the recession officially ended two years ago. That would be preferable to another recession, of course. But it would mean that ordinary Americans--especially...

It’s been many years since I’ve read The New York Times. Like most readers, I got discouraged by the shrinking page size, the self-confident erroneousness that becomes apparent whenever America's newspaper of record covers a topic I’m familiar with, and the lack of a comics page. Sure there are occasions when you can’t avoid it—usually when enough people are complaining about an article or when somebody I know is in the paper—but on a daily basis I follow the golden rule that life is just too short for The New York Times. So imagine my surprise the other day when,...

PLAYING CLIP OF RUSH LIMBAUGH, RADIO TALK SHOW HOST: John Maynard Keynes. If you want to know what Keynesian economics is, you`re living it, Barack Obama, massive government spending, massive debt, massive redistribution of wealth, the lie that government spending, deficit spending can propel economic growth.They had no intention of saving capitalism. They wanted to destroy it and replace it with socialism or Marxism or fascism or whatever you want to call it. (END VIDEO CLIP) I think that is the heart of the Tea Party, Michael, this fear of government massive spending, hemorrhaging, hemorrhaging. CROWLEY: Yes. MATTHEWS: That stimulus...

After three-plus years of floundering around, a consensus has finally arrived that we are back in recession. Growth is not happening. The meager statistical growth of the past few years — no one dared claim it amounted to full recovery — was probably illusory. There is real growth, and there are government statistics. The statistics have misled every gullible person, but now the truth is obvious to everyone. Not only that: we face an impossible debt calamity, the banking industry is zombied, labor markets are static, the system is flooded with mispriced resources, housing is still a mess, and there...

Some refreshing words from the Treasury Secretary, Tim Geithner this morning on Meet the Press. He had this to say: (15:20 into this clip) Note: An 8 second clip of Tim's words: Link We don’t have the ability (because of the overhang in housing and the problems in the financial sector) to engineer artificially a stronger recovery. Imagine that! Geithner acknowledges what I (and many others) have felt all along. The structural issues in the economy trump the government’s ability to engineer a recovery. The Fed has taken extraordinary measures on the monetary front. Since 2009 we have had $1.2...

The President quipped last week that part of the reason why his stimulus plan didn’t work was “the shovel ready jobs weren’t as shovel ready as we thought.” Since Obama has no business experience and hasn’t ever created a free market job, he’s totally befuddled why none of his economic plans are working. Even the President knows we are slipping into a double dip recession. He’s doing his best to still blame George Bush but even Debbie Wasserman Schultz admitted that the Democrats now own the economy. The root causes of the economy continuing to swoon are the Progressive and...

Obama’s Keynesian Economic Plan WILL End in a Great Depression and a One Term Presidency The definition of insanity is doing the same thing over and over again and expecting different results. And by that definition, the entire Obama Administration and the Progressive movement have proven themselves quite insane. Keynesian Economics has a perfect track record: 100% failure. Worse, the Obama Administration has twisted and convoluted the Keynesian Economic model to fit their ideological social agenda which is far more radical than any previous attempt to make this failed theory work. The recession has not ended. We are not in...

Do more on jobs, Dems tell ObamaBy Alexander Bolton - 06/10/11 06:00 AM ET Senior Senate Democrats are growing frustrated by what they see as President Obama’s passivity on the economy, and are beginning to discuss a large infrastructure package funded by tax increases. Some Democrats, such as Iowa Sen. Tom Harkin, who serves as chairman of the Health, Education, Labor and Pensions Committee, think such a package could lower the unemployment rate by as much as two percentage points. But the plan is not without political risk — Republicans would be quick to slap Democrats with the old “tax-and-spend...

New economics research suggests that President Obama's stimulus plan may have destroyed or forestalled employment, including more than 1 million private-sector jobs. Economists Timothy Conley, University of Western Ontario, and Bill Dupor of Ohio State University found that the stimulus resulted in a net loss of 595,000 jobs from April 2009 to September 2010. That counters research by the Congressional Budget Office, the Council of Economic Advisors, and many other economists.

In response to the Great Recession, the US government has gone on a spending spree in the hope of using Keynesian stimulus to restart the economy. However, according to a new analysis by Dr. Polina Vlasenko at the American Institute for Economic Research, that approach may make us even more vulnerable to future recessions. The amount of economic damage done to Western economies by the downturn directly relates to the aggregate debt in each economy as a percentage of GDP, she argues — and Japan and the Eurozone paid a steep price for their public and private debt. From the...

As the recession has deepened and the financial debacle has passed from one flare-up to another during the past year and a half, commentary on the economy's troubles has swelled tremendously. Pundits have pontificated; journalists and editors have reported and opined; talk radio jocks have huffed and puffed; public officials have spewed out even more double-talk than usual; awkward academic experts, caught in the camera's glare like deer in the headlights, have blinked and stumbled through their brief stints as talking heads on TV. We have been deluged by an enormous outpouring of diagnosis, prognosis, and prescription, at least 95...

This is the second music video depicting the century long debate between the economic theories of John Maynard Keynes & Friedrich Hayek. YouTube Video Nice to see media being used to reach out to young people. Hopefully they will see how central planning and spending aren't the only answers.

Donald Trump's Atlantic City empire includes the Trump Taj Mahal. The casino company that bears Donald Trump's 24-karat name is heading for bankruptcy. Trump sees bankruptcy as nothing more than a beneficial legal mechanism. There is no shame in bankruptcy, Trump says,"It doesn't matter - it's a modern-day thing, a legal mechanism," he told the Daily News.Trump said he's "really happy" with the restructuring agreement that Trump Hotels and Casino Resorts has made with its largest group of bondholders, pavings the way for a $345 million investment from Credit Suisse First Boston. The plan will be able to be carried...

The headline read "European Governments Completely Puzzled About US Position On Libya." To which we could only note, at this point within our Nation, many Americans can only sympathize with the puzzled Europeans. The wide if not dizzying array of bizarre policy positions that Obama and the Democrats have consistently taken could make even a mute Shaolin Monk shriek in terrified dismay. Even Secretary Of State Hillary Clinton has also had enough, apparently, when she intimated via the media that she would be hanging up her Department Of State riding gear and quitting public life in 2012 regardless of the...

www.catholicnewsagency.com Vatican bank chief issues warning about US, European economic policies Vatican bank director Ettore Tedeschi Rome, Italy, Jan 21, 2011 / 03:05 pm (CNA/EWTN News).- Current fiscal and monetary policies in the United States and Europe risk increasing government control over national economies, resulting in weakened political strength throughout “the whole of the western world,” the Vatican’s top banking expert said.Ettore Gotti Tedeschi has been head of the Vatican's bank, known as the Institute for Religious Works, since 2009. He has a long career in finance, having served as the head of Banco Santander, the largest private bank...

Could I trouble my fellow FReepers in answering this question? What is the best argument against Keynesian economics? I have just learned a family member has been brain-washed into believing this economic theory by his Econ professor and figured I would take a shot at converting him. I know the basic arguments but he is an ECON major and probably has some good rebuttals. That being the case, what do you guys think?

Neither government spending nor tax cuts automatically provide an economic stimulus. But President Obama has continued to make this mistake. Take a look at much of what he insisted be included in his tax cut deal with congressional Republicans. So what makes the economic pie bigger? There are two sides to this. The supply side: lower marginal tax rates mean the more that people get to keep from each additional dollar that they earn, the harder that they will work and the more that they will produce. The other view, the Keynesian view, also often called "the demand side view"...

Investors Business Daily titles its editorial today, “Keynesianism, RIP,” declaring the government-spending stimulus philosophy discredited in the wake of the 19th consecutive month of 9% or higher unemployment rates. IBD wants Barack Obama to put aside his “stubborn pride” (and his economic team) and start working with Republicans on policies that will truly stimulate the economy. But is the death certificate for Keynesianism premature? Please, Mr. President, you and your economic team of born-again Keynesian central planners have had your chance. Remember having to fire Christina Romer, among others, for forecasting your $800 billion stimulus bill would keep the jobless...

[Snippets] Dobbs goes on to describe Keynes’ homosexual relationships and fondness for young boys, which Keynes usually acquired in third-world countries where such services were more easily, and discretely, purchased than in more developed countries. (As a much older man, Keynes wrote of those halcyon days of his youth, “We repudiated all versions of original sin, of there being insane and irrational springs of wickedness in most men. We were not aware that civilization was a thin and precarious crust…and only maintained by rules and conventions. It did not occur to us to respect the extraordinary accomplishment of our predecessors...

Krugman: Death Panels for Elderly Will Solve Debt Crisis In an explosive interview Sunday on ABC's "This Week," liberal economist and New York Times columnist Paul Krugman discussed using "death panels" for the elderly to solve America's huge debt crisis. Though he's bashed conservatives for using the term for years, Krugman now acknowledges that severe health cuts for the aged and infirm now might be the right approach.

"This is the first time in seven and a half years that Ballmer has sold stock. His previous sales of Microsoft stock back in 2003 came in just under $1.6 billion. According to SEC filings, Ballmer has already sold off 49,341,652 shares of common stock across three different transactions this week, totaling a little more than $1.3 billion. Coincidentally, Microsoft chairman and founder Bill Gates also sold some of his company stock this week with two different sales (1, 2) totaling an even 3 million shares. The tax ramifications on the two sales are of special note given the savings...

"You won’t find a lot of Keynesians here,” explained one German economic policymaker in Berlin in September. That will not be news to anyone who has spoken to his counterparts in Washington. In their view, Germany is a skulker, a rotten citizen of the global economy, the macroeconomic equivalent of a juvenile delinquent, or worse. It is a smart aleck in the emergency ward that is the global economy. It is a flouter of the prescriptions of the new Doctor New Deal who sits in the White House. Germany has been scolded, even browbeaten, by Obama administration officials, from Treasury...

A rift has emerged within the Democratic Party between liberal economists, who generally view the 2009 stimulus package as a success and say that Keynesian economics should remain the heart of the party’s economic policy, and elected officials, who in growing numbers have shunned affiliation with the $787 billion effort and are expressing doubts about the effectiveness of fiscal intervention. For decades, Keynesian policies, which call for government spending to make up for the shortfall in private-sector demand during an economic downturn, have been a central element of the Democratic tool kit and a principle of the party’s identity. But...

The U.S. economy is being slowly but surely destroyed and many Americans have no idea that it is happening. That is at least partially due to the fact that most financial news is entirely focused on the short-term. Whenever a key economic statistic goes up the financial markets surge and analysts rejoice. Whenever a key economic statistic goes down the financial markets decline and analysts speak of the potential for a "double-dip" recession. You could literally get whiplash as you watch the financial ping pong ball bounce back and forth between good news and bad news. But focusing on short-term...

And we know that Keynes’ medicine — spend ‘til a nation is even more broke than it was at the start of the Depression — wouldn’t go over well with the American people during 1932, since it wasn’t a part of Roosevelt’s platform. FDR, to listen to him, seemed most concerned with ending Prohibition, and far from promoting massive Make Work Projects, in some ways, ran to the right of Herbert Hoover. But thanks to almost three quarters of a century worth of self-perpetuated myths, today’s liberals actually couldn’t wait for the 21st century economy to collapse before literally promising...

As they used to say on Sesame Street, "One of these things is not like the others, one of these things is not the same." The current recession "is not like the others." At 33 months it is already more than three times longer than the average length of the other ten recessions we've had since WWII. There are no clear signs it will be ending anytime soon. Glimmers of a recovery appear from time to time, but most indicators remain depressed and many are worsening. On balance, the outlook is more negative than positive. Not since the Great Depression...

Ferguson: Overwhelming US Crisis Looms Monday, July 26, 2010 09:41 AM By: Julie Crawshaw Economic historian Niall Ferguson says Keynesian economists are stuck in the 1930s, completely unaware that a US debt crisis could come quite suddenly. “All it takes is one piece of bad news — a credit rating downgrade, for example — to trigger a sell-off,” Ferguson writes in the Financial Times. “And it is not just inflation that bond investors fear. Foreign holders of US debt — and they account for 47 percent of federal debt in public hands — worry about some kind of future default.”...

Abstract In this essay, I argue that neither non-economist bloggers, nor economists who portray economics —especially macroeconomic policy— as a simple enterprise with clear conclusions, are likely to contibute any insight to discussion of economics and, as a result, should be ignored by an open-minded lay public. The following is a letter to open-minded consumers of the economics blogosphere. In the wake of the recent financial crisis, bloggers seem unable to resist commentating routinely about economic events. It may always have been thus, but in recent times, the manifold dimensions of the financial crisis and associated recession have given fillip...

Paul Krugman is known for throwing a bomb or two from his platform in the New York Times, but it's really tough to take him for a violent fellow. In his July 2 blog post, "I'm Gonna Haul Out The Next Guy Who Calls Me ‘Crude' And Punch Him In the Kisser," Krugman lamented criticism of his support for more stimulus spending. A July 1 editorial in The Economist noted that the economy needs more private spending, not more government spending. "Mr Krugman's crude Keynesianism underplays the link between firms' and households' behaviour and their expectations of future tax and...

(June 30) -- With the country fixated on the adventures of Gen. Stanley McChrystal and the BP spill, it's understandable that last week's most depressing news might have passed a few people by: The U.S. Senate is intent on extending America's economic misery. Led by all its Republican members and Democrat Ben Nelson of Nebraska, the Senate is filibustering a bill that includes, among other things, emergency jobless benefits. As a result, 1.2 million Americans have seen their checks cut off since June 2, a figure that could rise to 2 million over the next week. Failure to pass this...

"Irresponsible" refers to Congress and the Obama administration - and here's why. For thousands of years, businesses, organizations, governments and even individuals have relied on a basic tool to make sure they do not spend or borrow more than they can service - it is called a budget. Yet, for the first time since 1974, when the current rules were put into effect, the U.S. House of Representatives does not intend to pass a budget resolution. The main purpose of the budget resolution is to set discretionary spending caps for the coming fiscal year. Without a budget resolution, members of...