Where is UBL when we need him.

On Sat, Nov 15, 2008 at 8:16 PM, Societal Retard
<[EMAIL PROTECTED]>wrote:

> Too late for that either way, right?
>
>
> On Sat, Nov 15, 2008 at 8:53 PM, Travis <[EMAIL PROTECTED]> wrote:
>
>> 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>
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>>>
>>>
>>>
>
> >
>


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