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talkpolitics2011-07-06 12:58 pm
badlydrawnjeff.livejournal.com) wrote in talkpolitics2011-07-06 12:58 pm
Stimulus? Still a failure.
The failure of the stimulus isn't exactly news, and hasn't been for some time. Thankfully, more and more people are getting on board.
For instance, it looks like we might not have needed it to begin with. Granted, since stimulus of this nature doesn't work, we never need it, but the justification for it isn't so strong anymore:
Stanford's John Taylor showed us that tax credits and directed spending was fairly worthless:
Even Harvard's Robert Barro is on board to an extent. While he has yet to come around on the fact that stimulus has not ever been shown to work, he's at least noting that the merits of spending need to be more important than the stimulating impact:
With murmurings that we may need a second stimulus, the question remains as to why we'd pursue such a thing given the track record of the first. At this point, if you're still a proponent of Keynesian-style stimulus, why? What will it take to convince you that it will not succeed?
For instance, it looks like we might not have needed it to begin with. Granted, since stimulus of this nature doesn't work, we never need it, but the justification for it isn't so strong anymore:
"We had to hit the ground running and do everything we could to prevent a second Great Depression," Obama told supporters last week.
...
IBD reviewed records of economic forecasts made just before Obama signed the stimulus bill into law, as well as economic data and monthly stimulus spending data from around that time, and reviews of the stimulus bill itself.
The conclusion is that in claiming to have staved off a Depression, the White House and its supporters seem to be engaging in a bit of historical revisionism.
...
The argument is often made that the recession turned out to be far worse than anyone knew at the time. But various indicators show that the economy had pretty much hit bottom at the end of 2008 — a month before President Obama took office.
Stanford's John Taylor showed us that tax credits and directed spending was fairly worthless:
Individuals and families largely saved the transfers and tax rebates. The federal government increased purchases, but by only an immaterial amount. State and local governments used the stimulus grants to reduce their net borrowing (largely by acquiring more financial assets) rather than to increase expenditures, and they shifted expenditures away from purchases toward transfers.
Some argue that the economy would have been worse off without these stimulus packages, but the results do not support that view.
Even Harvard's Robert Barro is on board to an extent. While he has yet to come around on the fact that stimulus has not ever been shown to work, he's at least noting that the merits of spending need to be more important than the stimulating impact:
"In the long run you have got to pay for it. The medium and long-run effect is definitely negative. You can't just keep borrowing forever. Eventually taxes are going to be higher, and that has a negative effect," he said.
"The lesson is you want government spending only if the programmes are really worth it in terms of the usual rate of return calculations. The usual kind of calculation, not some Keynesian thing. The fact that it really is worth it to have highways and education. Classic public finance, that's not macroeconomics."
With murmurings that we may need a second stimulus, the question remains as to why we'd pursue such a thing given the track record of the first. At this point, if you're still a proponent of Keynesian-style stimulus, why? What will it take to convince you that it will not succeed?
no subject
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In my reality, Stalin was a member of the Politburo who during the Russian Civil War had already proven he was a treacherous, murderous sonofabitch who became ruler of the Soviet Union by being a master politician, relative to a Politburo filled with idiots. Stalinism began with collectivization, and at its height Stalinism's murderous assuming complete power over Russia and the rise of the NKVD gave it clear and nearly-identical natures to Hitler's party-state.
FDR, by contrast, won four terms in regular elections, embarked on rather limited social-welfare programs, and led the USA to victory in the largest war in US history. His Administration is rather narrowly "government" based and he was too much the New England aristocrat, moreso than Theodore in fact, to make it so. This to me is the difference: FDR was democratically elected and represented a 1930s democracy. Stalin's dictatorship only lacked Treblinkas and Sobibors, but otherwise every atrocity done by Hitler has a Stalinist counterpart.
Claiming that Ioseb Besarionvich Jugashvili and Franklin Delano Roosevelt were at all similar in terms of the political systems both steered is a ludicrous, idiotic idea of a crank who's read too much Rand.