< economists remain divided> There's something new! Whenever there is a piece of economic news you can be sure that you can get 10 different interpretations and 15 different opinions all pointing in opposite directions. Economics is an art - not a science.
-----Original Message----- From: profox-boun...@leafe.com [mailto:profox-boun...@leafe.com] On Behalf Of Bob Calco Sent: Thursday, 29 January 2009 1:43 AM To: 'ProFox Email List' Subject: [OT] For Many Economists, Stimulus Falls Flat http://tinyurl.com/c5n65h - - - (CBS) An unusual aspect of the recent debate in Washington is the lengths that supporters have gone to marginalize anyone who questions the so-called stimulus plan. Robert Reich, Bill Clinton's labor secretary and member of President Obama's transition team, claims "almost every economist will tell you the stimulus has to be massive." Nobel laureate and New York Times columnist Paul Krugman accuses skeptics of "making totally non-serious arguments." Sen. Chuck Schumer, a New York Democrat, says "economists agree" that doling out large sums to state governments is "effective." Vice President Joe Biden says that "every economist that I've spoken to" believes the spending package "has to be big." Perhaps the vice president should broaden his social circles. The truth is that, instead of being uniformly in favor of the massive spending bill, which is being championed by congressional Democrats with Obama's support, economists remain divided. ... Remember, the stimulus cash has to come from somewhere. If taxes are raised, people will be poorer. If the money is borrowed, it must be paid back with interest, and anyone lending to the U.S. Treasury has less to spend on other items. As in other parts of life, there's no free lunch. Don Boudreaux, the chairman of the economics department at George Mason University and contributor to CafeHayek.com, pointed out in an interview this week that economists still agree on many topics, such as the benefits of free trade and the harmful effects of price controls. "Keynesianism was in fact not a good theory," Boudreaux says, referring to the theories of the late economist John Maynard Keynes that encourage government spending. "In the profession, Keynesianism was almost dead until the past few months. It was never dead in the popular mind. It's a flat Earth kind of theory. People look out and see the Earth looks flat, so it must be flat. By and large, macroeconomists rejected at least the standard Keynesian line. Now it's back and that's a real mystery." He adds: "I think one of the fears is that the perception of the size of the downturn is so intense that even among professional economists, a lot of prudent, careful thought has gone out of the window: 'Geez, we have to do something...' The problem is not some kind of sudden lack of consumer confidence. The problem is that the bubble burst." Boudreaux and the other economists who are skeptical of stimulus spending may, as I tend to believe, be right. They may be wrong. But the arguments are not as one-sided, and the truth is more complicated, than stimulus proponents would have you believe. - - - We are going to experience endless crises while these charlatans are in power. These guys are going to do with every single issue on their agenda (nationalization of the economy, socialization of health care, a global tax system via "global warming", etc) exactly what they accused Bush of doing to sell Iraq: use fear to fool the people into surrendering their rights, their wallets, and even their souls. - Bob [excessive quoting removed by server] _______________________________________________ Post Messages to: ProFox@leafe.com Subscription Maintenance: http://leafe.com/mailman/listinfo/profox OT-free version of this list: http://leafe.com/mailman/listinfo/profoxtech Searchable Archive: http://leafe.com/archives/search/profox This message: http://leafe.com/archives/byMID/profox/00c301c98198$200af190$6020d4...@com.au ** All postings, unless explicitly stated otherwise, are the opinions of the author, and do not constitute legal or medical advice. This statement is added to the messages for those lawyers who are too stupid to see the obvious.
