I think the "problem" would fix itself if the damn gov't would stay out of it.
On Sat, Nov 15, 2008 at 7:05 PM, Societal Retard <[EMAIL PROTECTED]>wrote: > I dunno. I'm hearing you, and I'm admittedly a big Krugman fan- the simple > fact is that the guy has usually been right- but this economic catastrophe > is to serious to not take all ideas into account. What frustrates me is > that half of the original bailout money is *already gone, *most of it > apparently going to AIG, but no one actually knows where it went for sure- > Henry Paulson won't divulge any "details!" Amazing. > > If we don't just fix the problem, and keep throwing hundreds of billions > more out in band aid bailouts (Freddie and Frannie are going to need 500 > Billion to solve their sub prime problems, it's now being reported ) we'll > wind up with no money and will have failed to stop the crisis. > > On the other hand, if Krugman's wrong and we spend to much to fix it, we'll > open up a whole new set of problems because we'll be broke and won't be able > to even pay for basic infrastructure repairs, much less pay SSI and Medicare > costs. > > We're tottering perilously close to a bad place; If our currency loses to > much more of it's value, then foreign nations may choose to invest the > profits they make from exports (Hello China) in their own national banks > instead of investing in US treasury bonds, while also deciding to sell all > the treasury bonds they hold in the Federal Reserve now overnight because > the money will be, for the first time, worth more in their national banks > (or in another nation's bank) and earn more in interest elsewhere than it > would if invested in US Treasury bonds. > > A HUGE part of our economy relies on the money the US earns by being, > basically, the world's banker. If that arrangement changes because the > dollar becomes worth less and less, it would spark an economic meltdown that > might make the depression look like a beach party... > > We have to ditch our left vs right blinders in this time, and try to find > to best solution. > > Scary stuff. > > > On Sat, Nov 15, 2008 at 4:22 PM, Travis <[EMAIL PROTECTED]> wrote: > >> >> >> >> >> From: Travis >> Subject: Krugman's Prescription for Disaster >> Date: Thursday, November 13, 2008, >> >> >> *Krugman's Prescription for Disaster >> *by David T. Beito >> >> Paul Krugman calls for Obama and his advisors to push an expanded version >> of the New Deal (see the link below by Mark R. >> Hatlie<http://www.historiansagainstwar.org/blog/2008/11/new-new-deal-krugman-in-nyt-about.html>). >> According to Krugman, they should boldly throw caution to the >> winds<http://www.nytimes.com/2008/11/10/opinion/10krugman.html?th&emc=th>and >> *"figure out how much help they think the economy needs, than add 50 >> percent. It's much better in a depressed economy, to err on the side of too >> much stimulus." >> >> *Obama should reject this advice. If he listens to Krugman, the likely >> result will be a wave of stagflation that makes the experience of the 1970s >> look mild by comparison. Such a prescription would both continue and >> accelerate Bush's fiscally reckless policy of propping up malinvestments >> through massive increases in spending, deficits, and easy credit by the >> Federal Reserve. As the continuing fall of the stock market and the rise of >> unemployment indicate, more bailouts and more "shock socialism" do not work. >> Obama made a fatal mistake in failing to oppose the aptly described >> billionaire bailout. >> >> This call for a hyper New Deal rests on a flawed view of history. >> According Krugman, the only reason Roosevelt failed to bring recovery was >> because he spent too little, not too much. At the same time, he tries to >> have it both ways by stating that the crisis of the 1930s would have been >> "much worse" without the New Deal. >> >> A key problem with Krugman's analysis is that it does not adequately >> explain why the decade-long New Deal era depression lasted so much longer >> than previous depressions. Prior to the 1930s, depressions (as in the sharp >> and short downturn of 1921 and 1922) had typically lasted for two to three >> years. The predominant anti-depression policy before Hoover and Roosevelt >> was to cut spending, balance budgets, and let prices, profits, and wages >> readjust to more sustainable levels. Yet Krugman regards this older approach >> for curing depressions as "much worse" than the New Deal. The logical >> implication of his argument is that the New Deal, modest as it was, would >> have made the Great Depression at least somewhat shorter than previous >> downturns. The fact that it did not stands as a stunning indictment of FDR's >> policies. >> >> The unprecedented duration of the depression also represents an indictment >> of Herbert Hoover's approach. This was because Hoover intervened too much >> not, as Krugman would have it, too little. Krugman's article neglects the >> relevant point that Hoover had pursued a mini-New Deal from 1929 to 1933 via >> programs such as the Reconstruction Finance Corporation and the Federal Farm >> Board. It was Hoover, not Roosevelt, who was the first president to reject >> the advice of the "leave it alone liquidationists." Instead of letting >> malinvestments (or toxic assets in today's parlance) readjust at a lower >> level, he desperately propped them up. In great part because of Hoover's >> high-wage policies, real wages were actually 12 percent higher in 1932 than >> in 1929! Meanwhile, of course, unemployment advanced to record levels as >> businesses saved on payroll costs by laying off workers. Perhaps if Hoover >> had listened to the advice of the so-called "liquidationists," the >> depression would have been over by 1931. >> >> More troubling, at least for opponents of war, is Krugman's dubious >> contention that *"What saved the economy, and the New Deal, was the >> enormous public works project known as World War II, which finally provided >> a fiscal stimulus adequate to the economy's needs."* The evidence does >> not support the view that that war was beneficial for the economy. In a >> seminal article for the Journal of Economic History, Robert Higgs >> convincingly >> challenged <http://www.independent.org/newsroom/article.asp?id=138> the >> Keynesian theory of World War II as put forward by Krugman and others. >> >> While unemployment disappeared during the war, it was hardly a step >> forward. Moving men and women from the unemployment lines to the killing >> fields of Anzio did not represent economic progress in any meaningful sense. >> During the war, Americans at home suffered from rationing, shortages, more >> accidents on the job, longer hours, and many other measures of economic >> deprivation. Moreover, as Higgs points out, *"real personal consumption >> declined. So did real private investment. From 1941 to 1943 real gross >> private domestic investment plunged by 64 percent; during the four years of >> the war it never rose above 55 percent of its 1941 level; only in 1946 did >> it reach a new high." >> >> *According to Higgs<http://www.independent.org/pdf/tir/tir_01_4_higgs.pdf>, >> genuine prosperity did not begin to return until the last months of 1945 >> and 1946. This prosperity occurred under a policy of reverse Keynesianism >> which included massive reductions in spending because of demoblization, >> rapid steps toward price decontrol, and scaled back deficit spending. >> >> Higgs sums it up<http://www.independent.org/newsroom/article.asp?id=2188> >> : >> >> World War II, the so-called Good War, has been a fount of historical >> fallacies. One of the greatest – and one of the most pernicious for >> subsequent policymakers – is the notion that prosperity prevailed during the >> war. Although Americans might have been dying in the Pacific and European >> theaters of war, people on the home front actually benefited from the war, >> because it propelled the economy at long last out of the Great Depression. >> This view of the war would be sufficiently egregious if it were true, but >> despite the claims of historians for the past half century, it is not true. >> >> Obama's best hope to bring lasting recovery is to let the economy go >> through a short, but sharp, readjustment. He needs to remove the >> malivestments not, contra Krugman, perpetuate them. Obama can facilitate >> this readjustment to a more sustainable level by cancelling the bailout, >> cutting spending, and pruning deficits. Another worthy goal would be to >> dismantle the Federal Reserve which helped to create this mess through its >> easy credit policies. >> >> Most of all, however, Obama should end our costly empire by closing down >> our overseas bases and bringing home the troops. Only then, can we start to >> get our financial house in order and move towards genuine economic well >> being. >> >> >> http://www.lewrockw ell.com/orig8/ >> beito4.html<http://www.lewrockwell.com/orig8/beito4.html> >> __._,_.___ Messages in this topic >> <http://groups.yahoo.com/group/tsowell/message/5386;_ylc=X3oDMTM0cWcycGduBF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BG1zZ0lkAzUzODYEc2VjA2Z0cgRzbGsDdnRwYwRzdGltZQMxMjI2NjQ5NDY2BHRwY0lkAzUzODY-> >> (1) Reply (via web post) >> <http://groups.yahoo.com/group/tsowell/post;_ylc=X3oDMTJwdXRudnN1BF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BG1zZ0lkAzUzODYEc2VjA2Z0cgRzbGsDcnBseQRzdGltZQMxMjI2NjQ5NDY2?act=reply&messageNum=5386>| >> Start a new topic >> <http://groups.yahoo.com/group/tsowell/post;_ylc=X3oDMTJlNWVxbGNlBF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA250cGMEc3RpbWUDMTIyNjY0OTQ2Ng--> >> Messages<http://groups.yahoo.com/group/tsowell/messages;_ylc=X3oDMTJlaGRwbWI4BF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA21zZ3MEc3RpbWUDMTIyNjY0OTQ2Ng-->| >> Files<http://groups.yahoo.com/group/tsowell/files;_ylc=X3oDMTJmc2RhbDdzBF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA2ZpbGVzBHN0aW1lAzEyMjY2NDk0NjY->| >> Photos<http://groups.yahoo.com/group/tsowell/photos;_ylc=X3oDMTJlbWJsZTBzBF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA3Bob3QEc3RpbWUDMTIyNjY0OTQ2Ng-->| >> Links<http://groups.yahoo.com/group/tsowell/links;_ylc=X3oDMTJmcGs3M29kBF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA2xpbmtzBHN0aW1lAzEyMjY2NDk0NjY->| >> Database<http://groups.yahoo.com/group/tsowell/database;_ylc=X3oDMTJjbGJnMnByBF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA2RiBHN0aW1lAzEyMjY2NDk0NjY->| >> Polls<http://groups.yahoo.com/group/tsowell/polls;_ylc=X3oDMTJmY3ZsbXE3BF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA3BvbGxzBHN0aW1lAzEyMjY2NDk0NjY->| >> Members<http://groups.yahoo.com/group/tsowell/members;_ylc=X3oDMTJldGNndHMwBF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA21icnMEc3RpbWUDMTIyNjY0OTQ2Ng-->| >> Calendar<http://groups.yahoo.com/group/tsowell/calendar;_ylc=X3oDMTJkYjRjaWM5BF9TAzk3MzU5NzE0BGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA2NhbARzdGltZQMxMjI2NjQ5NDY2> >> MARKETPLACE >> ------------------------------ >> From kitchen basics to easy recipes - join the Group from Kraft Foods >> <http://us.ard.yahoo.com/SIG=13rkjn14i/M=493064.12016295.13271503.10835568/D=groups/S=1705060375:MKP1/Y=YAHOO/EXP=1226656666/L=/B=Nv4fA0LaX.0-/J=1226649466655249/A=5530388/R=0/SIG=11nuutlas/*http://explore.yahoo.com/groups/kraftmealsmadesimple/> >> [image: Yahoo! >> Groups]<http://groups.yahoo.com/;_ylc=X3oDMTJkMmpzcnYxBF9TAzk3NDc2NTkwBGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA2dmcARzdGltZQMxMjI2NjQ5NDY2> >> Change settings via the >> Web<http://groups.yahoo.com/group/tsowell/join;_ylc=X3oDMTJmbnYwdm9yBF9TAzk3NDc2NTkwBGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA3N0bmdzBHN0aW1lAzEyMjY2NDk0NjY->(Yahoo! >> ID required) >> Change settings via email: Switch delivery to Daily Digest<[EMAIL >> PROTECTED]:+Digest>| Switch >> format to Traditional<[EMAIL PROTECTED]:+Traditional> >> Visit Your Group >> <http://groups.yahoo.com/group/tsowell;_ylc=X3oDMTJkcXJxZG1lBF9TAzk3NDc2NTkwBGdycElkAzQzNDQyNTUEZ3Jwc3BJZAMxNzA1MDYwMzc1BHNlYwNmdHIEc2xrA2hwZgRzdGltZQMxMjI2NjQ5NDY2>| >> Yahoo! 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