Thread: Stop Coddling the super Rich

Good argument, though I am unsure of who you support since you seem to be criticizing both the liberals and conservatives. I apologize if I am mistaken

Originally Posted by michael h

We traded for cheap goods from China and doubled corporate profits at the expense of small businesses, high unemployment, GDP, increased social services, job growth, and lost government revenues.

As to the start of the mess ... corporate lobbyists pushed this agenda through both parties ... its not a one party issue. Clinton drove this car.

Thats why I support a global currency . We never have to deal with cheap labor and Trade Wars

Originally Posted by Cudorp

Thats why I support a global currency . We never have to deal with cheap labor and Trade Wars

That makes no sense.
The Directors and CEOs of MNCs live quite well in China whilst the average person here would be a pauper.

Originally Posted by Cudorp

Good argument, though I am unsure of who you support since you seem to be criticizing both the liberals and conservatives. I apologize if I am mistaken

I've voted Carter, Reagan, Clinton, and anybody but Bush's. I'm conservative in some views and economically I support Reagan to Clinton level taxation. I'm against trade with China which is supported by both parties. I'm against GDP exports in general.

I'm for the wealthy keeping their money "Reagan" and against corporate policies which allow access to our economy by cheap labor goods.

If it works ... support it ... if it fails ... shitcan it.

Originally Posted by Cudorp

Thats why I support a global currency . We never have to deal with cheap labor and Trade Wars

I'm not sure this works well in the EU. Germany may benefit while it hurts others.
However I don't understand the subject enough to have a formed opinion.

Originally Posted by machinehead61

LOL ! OHhhhh buddy, you went out to lunch and never came back.

Where would you like your very first introductory economics text book mailed?

:rolleyes: As I said I really could not take your post very seriously But now that I have a little more time I thought I‘d explain why. I would wonder why a buffed up ego would consider posting a bunch of irrelevant quotes that relate very little to the subject under discussion and not at all to the substance of any argument or the facts presented as worthy. It is a common tactic of the intellectually lazy dogmatic thinker to present a non-argument believing that it some how rebuts whatever preceded it.

Start here:

"Modern radical economists have constructed a model of American capitalism which is essentially an extension and updating of Marxian thought."

Many social scientists (and others) have spent years attempting to construct models describing the behavior of complex dynamic systems (the economy, the stock market, the climate) that fail to explain and fail to predict any event in the real world.

Campbell R. McConnell
Professor of Economics, University of Nebraska
Economics, Principles, Problems, and Policies, Tenth Edition
Copyright 1987, 1984, 1981, 1978, 1975, 1972, 1969, 1966, 1963
McGraw-Hill
p. 816

This is a college level economics text book.

As you can see, it was published by one of the biggest college text book publishers in America for at least 24 years and thru 10 editions.

In this text, it divides modern economists into two major divisions, the larger orthodox group and the smaller "New Left," neo-Marxist, or radical group.

Let me guess which side do you lean toward?

"Orthodox economists, in other words, envision a basic harmony in capitalism which allows the system to realize a satisfactory and workable reconciliation of divergent interests.......Where the market fails - for example, in the cases of unbridled monopoly, public goods, spillover costs, and income inequality - a benevolent government will intervene so as to protect and promote the general welfare."

More of the usual discredited silliness we have seen before. There are no historical cases where an unbridled monopoly has risen up and established itself without the aid of government. Government forms monopolies, not capitalism. Capitalism is not an ism like communism, socialism, liberalism, progressivism, or conservatism. As I have repeated many times, the term “capitalism” was coined by Karl Marx and it was meant to refer to the laissez faire economic policies of liberal democracies of the West. Capitalism is simply an economic system where individuals have the freedom to engage in exchanges of goods and services without third party control of those transactions.

A government with the power to intervene to protect also has the power to intervene to do harm and the global history of governance could be said to be a series of examples doing more of the latter than the former -- and most of the time in all good intention. For example the government intervention in the markets that were carried out by Hoover and FDR caused, then deepened, and then prolonged the Great Depression. A more recent case would be the intervention of Obama with his Porkulous Package, his Obama Crap Care, and the later Dodd-Frank Financial Reform Act.

Campbell R. McConnell
Professor of Economics, University of Nebraska
Economics, Principles, Problems, and Policies, Tenth Edition
Copyright 1987, 1984, 1981, 1978, 1975, 1972, 1969, 1966, 1963
McGraw-Hill
p. 815

Here, the text states that even the orthodox economists acknowledge the existence of the same problems of capitalism that Marx pointed out, and that government does intervene to solve them.

Even the orthodox economists do not endorse the income inequality in our economy as desirable, and refer to it as a market failure.

Incomes are “earned” not distributed. Since everyone has different talents, ambitions, discipline, education, experiences, and interests there will always be differences in the earning capacity of individuals. There has always been differences in income earning capacity, but in the West, especially here in America the norm has been income mobility. Most who invest moral angst in “income inequality,” like your hero Galbraith, present the data of “household or family” statistics which hide the true experience of the vast majority of people. “Statistical categories” hide the facts that those counting among the lower income brackets will be counted again ten years later among the upper income brackets. It hides the fact that there are almost twice as many people earning an income in the upper brackets (64 million) than are earning an income in the lower brackets (39 million). It hides the facts that those in the upper income brackets will be older, have more work experience, are better educated, will work more hours during the week, and are more likely to be full time year round workers. I have already presented all of this with the necessary links and citations several times so I shall not repeat myself here.

The radical economists, far from being an obscure, fringe element of the economic spectrum, are published in the major economic periodicals, testify before Congress, and are published by the major text book publishers.

Almost all of my college economics text books cover Karl Marx.

Yes, sadly some think Marx presented something worthy of serious study, rather than presenting an example of an ideological driven system that fails to deliver the goods.

The orthodox economists don't agree with all of his philosophies, much less his solutions, but his criticism of capitalism - especially the income inequality, is far from discredited, even by orthodox economists.

Some may believe so. Others not so much. This is especially the case for those who have investigated the historical and empirical data and have compared it with the pronouncements and rhetoric of Marxist theory.

The historical conditions that were everywhere in Marx's day were what led him to his analysis of capitalism. Adam Smith's "invisible hand" was looking more like the age-old tyrants' iron fist.

:rolleyes: Garbage. Free market capitalism has done more to alleviate the conditions of poverty and raise living standards for more people than any other economic system or political structure.

"A theoretical refutation was also needed, because Marx's critique of capitalism was based upon the assumption of classical economics itself - on the labor theory of value and the theory of capital accumulation. He used the weapons of the dominant ideology to attack the very system those weapons defended."

Daniel R. Fusfeld
The Age Of The Economist, 1982
p. 61

Yea, a slight twisted cartoon of the theories of classical economics.

The economists of 1870-1900 thus were in an inductive reasoning panic. They all aimed their logic to support capitalism and worked backwards in their logic to achieve their desired outcome - Marx must be wrong.

The panic was due to clear thinking individuals perceiving the harm Marxist ideology would have on so many and their panic and fears was born out by history.

This gave birth to the principles of marginal utility, marginal productivity and the theory of general equilibrium.

Fear and panic gave birth to marginal utility? Ah, no. But being an disciple of Galbraith I understand why you would believe so. Galbraith’s presentation is of a flawed theory of the marginal utility of wealth, while the theory of marginal utility is about goods or production.

These theories of course have truth in them and Marx's analysis never considered the intervention of unions, government social policies such as unemployment insurance, etc...

But, these theories all rested upon a set of assumptions which were less than realistic:

Like the negative effects on human behavior of unions and government social policies such as unemployment insurance and welfare.

"The validity of the theory of marginal productivity depended upon the existence of that theoretical Nirvana, perfect competition.

There is no such thing as “perfect competition” in the real world, not in economics or in athletics. Economists seek to present the most simplistic of models to revel the effects of different factors on human action. In doing so, they understand that “perfect competition” is not reflective of the real world, but that is part of their point.

It also required that all factors of production be fully and freely substitutable for one another and that there be no change in costs of production per unit of output as the level of production rose or fell.

Really? Other than mathematical economists which economists make that case in the absolute?

But these highly restrictive assumptions did not bother many economists, who by this time were lost in the theoretical glories of a perfectly competitive economy."

Daniel R. Fusfeld
The Age Of The Economist, 1982
p. 74

:rolleyes:

End of Part 1

tashi deleks,

M

Originally Posted by machinehead61

The "death" of Marx's economics was by inductive logical necessity, not by evidence,

The “death” of Marxists economics was due to the fact that it did not and was not able to explain or predict any historical event in any clear fashion and due to the fact that it contained so many logical contradictions within it. The evidence of history damn Marxist theory more than anything else.

and the vast majority of economists were more than happy to accept a theory which "proved" Marx wrong, even if the new theory was based upon assumptions which were not realistic. Thus the vast majority of the economic world held a funeral for Marx's analysis because they had to - it threatened their whole ideological foundation that capitalism and free markets must work better than any other alternative.

Ah, no. Free market capitalism does work better than any other alternative -- history and empirical data has proven that fact over and over again. What happened to the Soviet Union? What happened to Mao’s China? How fast did England reject Atlee’s benign democratic socialism? How is socialist Spain doing? Europe is doing all it can to turn its back on the socialism that has infested and saddled it with burdens it can no longer carry.

But not all economists were happy with it. Among these was Alfred Marshall, the dominant figure in English economics from 1890 to after WW II.

Keynes had no effect? Atlee was a Marshallian?

"All this notwithstanding, (Joseph Alois) Schumpeter never became a cult figure of American conservatism as did von Hayek, von Mises and the other exponents of the traditional irrelevancy.

“Traditional irrelevancy,” nice twist of phrase. But verbal skill is not a refutation.

This was partly because he lacked solemnity and loved to shock his own natural supporters. He praised Marx as a genius, a prophet and "a very learned man."

A prophet of doom perhaps. A genius among idiots. A learned man among the uninformed.

Contemplating the future, he asked, "Can capitalism survive?" And replied, "No, I do not think it can."

John Kenneth Galbraith
A life In Our Times, Memoirs, 1981
p. 50

Could you pick someone who has been more wrong more often? Sure he has skill as a writer, but good writing does not necessarily mean clear thinking. He plays verbal bait and switch and pushes his Progressive Keynesianism without regard to the facts that contradict or the arguments that challenges his dogma. And as an advisor to FDR he helped to prolong and make Great the depression that was caused by the government intervention of the Progressive Republican Hoover.

"Further and in its ultimate influence perhaps the most important of all, the system (capitalism) had an inherent tendency to devastating depression.

:rolleyes: Actually devastating depressions are far more likely to be devastating due to the actions and interventions of government. Most depressions have been caused by poor monetary policy by central banks or the machinations of governments (for example the Treasury and Fed's mismanaging the money supply). When the markets are allowed to adjust to any new conditions depressions are over sooner than later. An example of government intervention deepening and prolonging a depression is the Great Depression, which Galbraith did his part to deepen and prolong while working for FDR.

Sismondi, the great Swiss historian, philosopher and economist, had published at the beginning of the century a book which reflected much of the hopeful attitude of Adam Smith. Then, sixteen years later and after extensive travels over Western Europe, he returned to the subject impressed by the importance of industrial crises and persuaded that they would get worse.

The trouble was that the purchasing power of the workers did not keep abreast of what they produced.

:rolleyes: Ah, and here comes the old under consumption fears that Say’s discredited over two centuries ago. The fact is with the increase in production the wages and standard of living of “workers” rose.

As a result, goods accumulated for which there were no buyers. A crisis became inevitable. Marx's view of depressions, which he was still working out when he died, was roughly similar and so, in recent times, has been that of almost everyone."

John Kenneth Galbraith
The Affluent Society, 1958, updated 1998.
p.56-57

Do you realize that you have been presenting quotes that includes no evidence that supports the claims being made or on the topic being discussed? Galbraith backs nothing up with any actual empirical data to support his pronouncements, which are meant to be taken axiomatically rather than examined empirically. None, absolutely none of his prediction came true.

And yet more.........

"Had Marx been mostly wrong, his influence would quickly have evaporated. The thousands who have devoted their attention to demonstrating his errors would have turned their attention elsewhere. But on much he was notably right, especially in relation to his time. The latter point is worth emphasizing. Most economic philosophers needed only to be right as regards their own time. No one defends Adam Smith in his conviction that corporations - joint stock companies - had no future. But Marxists required that Marx, with some adjustment, be right not only for his own time but for all time. This was a truly formidable test.

Regardless of the discipline, any theory to be considered true must stand the test of time. Newtonian physics stood the test of time and is still considered valid for calculating and predicting such things like putting a satellite in orbit or landing a man on the moon. An explanatory theory that is only right in relation to its time or place is very limited, so limited that it is basically useless.

And it was because that Marx was so manifestly right on some things

What “some things” were Marx manifestly right? That man must engage in some form of social labor to acquire the goods needed for his survival? Duh!

that few could suppress the insistent question: Might he not be right on other things - including the prospect for capitalism itself ? Might it be that Marx faced facts while others sought the dubious shelter of wishful thinking ?"

John Kenneth Galbraith
The Affluent Society, 1958, updated 1998.
p. 61-62

Just in case you never heard of John Kenneth Galbraith, which judging by your extreme ignorance of basic economic history is a distinct possibility:

I read The Affluent Society over thirty years ago and was, due to my political and economic ignorance at the time, quite taken in by it. To quote Monty Python, “I got better.”

John Kenneth Galbraith - Wikipedia, the free encyclopedia

"Due to his prodigious literary output he was arguably the best known economist in the world during his lifetime and was one of a select few people to be awarded the Presidential Medal of Freedom twice, in 1946 and 2000, for services to economics."

And buddy, this is only the TIP of the iceberg.

:rolleyes: [sarcasm alert] And the Nobel Peace Prize was awarded to Arafat, AlGore, and Obama.

Hold on to your pants if you continue to spew out such patent nonsense. I will flood you with history you ain't never seen.

Still waiting for you to present anything I haven’t seen before. So far all its been is selected quotes that have nothing to do with the topic under discussion and ideological rants that prove to me your willful blindness of the real world and your adherence to discredited Marxist doctrine.

End of Part 2

tashi deleks,

M

Originally Posted by machinehead61

In response to:
Originally Posted by Mahasattva
Following your logic Smoot-Hawley should have been a great idea, since it was done to save American farmers and American jobs. History and empirical economic data proves that your logic is flawed and your claims are false.

I can tell right from the start that this guy is going to be fun - a regular turkey shoot.

Let us start with the facts, not free trade dogma divorced from all reality:

This is from my edit job of Wiki which has been vandalized numerous times by the conservative "lovers of truth":

Smoot?Hawley Tariff Act - Wikipedia, the free encyclopedia

Which is why wiki should always be taken with a big boulder of salt and not be considered the go to source for anything other than the most shallow of information and data.

"Historically, there has been confusion as to the actual tariff level imposed by the Smoot-Hawley Tariff.

Why do I believe that Smoot-Hawley Tariff was the actual cause of the depression of the 30s? Its what the data revels. You see its not the specific rate of a tax or a tariff alone that effects human action, it’s the rates relationship with other factors and conditions. You believe you have ended the discussion with your presentation of the different tariff rates by different countries, but like Mike's use of his disingenuous and intellectually dishonest graphs about income distribution of family/households, which your hero Galbraith also loved, it hides other facts that revel a far different picture. On page 77 of: Out of work: unemployment and ... - Google Books

You can see the: Estimated Monthly Unemployment November 1929-December 1939
__________________________________________________ ___________________________________
Year----Jan.-----Feb.-----March----April----May----June-----July-----Aug.-----Sept.-----Oct.-----Nov.-----Dec.
1929----------------------------------------------------------------------------------------------5.0------9.0
1930-----8.9------7.6-------7.6-----6.6-----6.8------6.3------7.8------6.4-------7.0-------6.1----11.6-----14.4
1931-----13.8----14.7------14.5----14.0----14.9-----15.0-----15.5----16.0------17.4------16.7----18.6-----19.8
1932-----19.7----20.4------21.1----21.7----23.7-----25.8-----25.8----26.4------27.9------25.6----23.2-----22.3
1933-----25.9----26.1------28.3----27.3----27.3-----24.9-----23.3----23.4------23.9------22.9----23.2-----22.4
1934-----21.2----20.3------20.0----21.4----21.0-----20.7-----21.8----22.3------23.5------23.5----23.2-----21.6
1935-----19.3----18.6------18.5----18.7----20.1-----19.4-----21.3----20.0------19.6------21.9----21.8-----20.2
1936-----18.7----18.0------19/4----18.4----20.1-----16.9-----16.0----16.1------15.0------17.7----13.9-----15.3
1937-----15.1----15.1------13.5----13.2----17.5-----13.6-----13.7----13.5------12.5------13.3----17.1-----18.9
1938-----17.4----18.8------19.2----20.1----20.1-----20.6-----19.9----20.2------19.5------17.1----17.7-----17.5
1939-----18.7----19.3------19.3----20.7----19.9-----18.5-----18.3----17.6------14.3------11.6----13.9-----14.4

As Sowell, points out in: Thomas Sowell: The myth of how the Great Depression was resolved | Thomas Sowell | Op Eds | Washington Examiner Those who think that the stock market crash in October 1929 is what caused the huge unemployment rates of the 1930s will have a hard time reconciling that belief with the data in that table.
Although the big stock market crash occurred in October 1929, unemployment never reached double digits in any of the next 12 months after that crash. Unemployment peaked at 9 percent, two months after the stock market crashed-- and then began drifting generally downward over the next six months, falling to 6.3 percent by June 1930.
This was what happened in the market, before the federal government decided to "do something."
What the government decided to do in June 1930-- against the advice of literally a thousand economists, who took out newspaper ads warning against it-- was impose higher tariffs, in order to save American jobs by reducing imported goods.
This was the first massive federal intervention to rescue the economy, under President Herbert Hoover, who took pride in being the first President of the United States to intervene to try to get the economy out of an economic downturn.
Within six months after this government intervention, unemployment shot up into double digits-- and stayed in double digits in every month throughout the entire remainder of the decade of the 1930s, as the Roosevelt administration expanded federal intervention far beyond what Hoover had started. …
While the market produced a peak unemployment rate of 9 percent-- briefly-- after the stock market crash of 1929, unemployment shot up after massive federal interventions in the economy. It rose above 20 percent in 1932 and stayed above 20 percent for 23 consecutive months, beginning in the Hoover administration and continuing during the Roosevelt administration.

Why do I believe that if government had stayed out of the way and did not seek to “fix” the markets or “protect American jobs” by enacting high tariffs? The 1929 market crash was not the first nor the last market meltdown. There was another later one which Thomas Sowell mentions in his column. It is all but forgotten, the crash of 1987. But unlike the crash of 1929 the government did not seek to fix the markets.
As Sowell says, The 1987 stock market crash was followed by two decades of economic growth with low unemployment. But that was only one difference. The other big difference was that the Reagan administration did not intervene in the economy after the 1987 stock market crash-- despite many outcries in the media that the government should "do something."

tashi deleks and thank you for playing,

M

Originally Posted by michael h

Originally Posted by Mahasattva
----------------------
I predict you will reply with some lame ridicule and dismissive insulting comments without addressing the substance of my argument or the EMPIRICAL FACTS I have provided.

THE END

You disappeared

I know its hard for you to believe, but people have lives beyond this forum. Lives that are far more important than this forum.

and probably haven't yet read the Harvard study.

As I have already told you, I have read the Harvard study that does not support your claims. It says nothing about the practice of outsourcing and never claims that our trade deficit “caused” the recession.

The solution of which is listed below.

The Harvard study does present some good ideas regarding fiscal responsibilities and adjustments to the financial markets. It does not present anything that would have stopped the housing market collapse or the financial market meltdown.

Isn't it about time for you to come back and declare victory in the debate you have avoided?

:rolleyes: You do not debate Mike and neither does your new friend Mach. You ignore anything that challenges your dogma and post graphs that do not support your claims. You pick and chose data that hides the facts rather than present a reasoned rebuttal against the substance of any argument or evidence presented. You engage in personal attacks and never address the specifics of any counter argument presented. Mach believes he scores mythic points by presenting quotes by Galbraith that have nothing to do with the discussion or topic.

I proved to you that Free Trade with China and outsourcing caused the recession, with only the common sense of an 8th grade education.

False. Your Harvard study never makes that claim Mike, and nothing in it refers to outsourcing. You have proved nothing but your ignorance and your blind fanatical faith in your delusions.

No more quotes from TV stars and pet shows, declaring their expertise in economics?

I presented empirical data gathered by economists that showed the benefits of free trade and the practice of out sourcing. I presented the real world facts gathered by respected journalists and pundits from both liberal and conservative perspectives. You ignored that empirical study that showed the benefits for all Americans of out sourcing (companies that engaged in it were able to expand their business and therefore able to hire more Americans than they would have ever if they had not). You never address the substance of the arguments presented and you ignore any empirical data that directly challenges your sacred cow and dismissively insult anyone who does not share your delusions.

What changes in the international financial system might mitigate global imbalances in the future?

What needs to happen is that governments across the global, especially America, need to live within their means. Your delusional fears over free trade are misguided and without foundation.

Why do we need to mitigate global imbalances resulting from GDP exports? Friedman didn't say we needed to fear financial capital from them!

That’s right he didn’t and we don’t.

No more comments about job creation from trade openness?

Why should I waste my time with you Mike? You ignore the facts that do not agree with your dogma. You do not understand the data you present, which is obvious when you attribute causal relations to the data you present where there is none.

I think I saw some jobs in the field of outsourcing!

:rolleyes: As has been pointed out to you, our current unemployment levels are due to Obama’s mismanagement and horrible non-leadership and have absolutely nothing to do with the practice of outsourcing.

No more claims that Smoot Hawley caused the depression now that tariff rates have been listed?

:rolleyes: Why do I believe that Smoot-Hawley Tariff was the actual cause of the depression of the 30s? Its what the data revels. You see its not the specific rate of a tax or a tariff alone that effects human action, it’s the changed rates relationship with other factors and conditions. Your buddy Mach thinks he has ended the discussion with his presentation of the different tariff rates by different countries, but like your use of your disingenuous and intellectually dishonest graphs about income distribution (income is not earned, not distributed) of family/households, it hides other facts that revel a far different picture. On page 77 of: Out of work: unemployment and ... - Google Books

You can see the: Estimated Monthly Unemployment November 1929-December 1939
__________________________________________________ ___________________________________
Year----Jan.-----Feb.-----March----April----May----June-----July-----Aug.-----Sept.-----Oct.-----Nov.-----Dec.
1929----------------------------------------------------------------------------------------------5.0------9.0
1930-----8.9------7.6-------7.6-----6.6-----6.8------6.3------7.8------6.4-------7.0-------6.1----11.6-----14.4
1931-----13.8----14.7------14.5----14.0----14.9-----15.0-----15.5----16.0------17.4------16.7----18.6-----19.8
1932-----19.7----20.4------21.1----21.7----23.7-----25.8-----25.8----26.4------27.9------25.6----23.2-----22.3
1933-----25.9----26.1------28.3----27.3----27.3-----24.9-----23.3----23.4------23.9------22.9----23.2-----22.4
1934-----21.2----20.3------20.0----21.4----21.0-----20.7-----21.8----22.3------23.5------23.5----23.2-----21.6
1935-----19.3----18.6------18.5----18.7----20.1-----19.4-----21.3----20.0------19.6------21.9----21.8-----20.2
1936-----18.7----18.0------19/4----18.4----20.1-----16.9-----16.0----16.1------15.0------17.7----13.9-----15.3
1937-----15.1----15.1------13.5----13.2----17.5-----13.6-----13.7----13.5------12.5------13.3----17.1-----18.9
1938-----17.4----18.8------19.2----20.1----20.1-----20.6-----19.9----20.2------19.5------17.1----17.7-----17.5
1939-----18.7----19.3------19.3----20.7----19.9-----18.5-----18.3----17.6------14.3------11.6----13.9-----14.4

As Sowell, points out in: http://washingtonexaminer.com/node/75086 Those who think that the stock market crash in October 1929 is what caused the huge unemployment rates of the 1930s will have a hard time reconciling that belief with the data in that table.
Although the big stock market crash occurred in October 1929, unemployment never reached double digits in any of the next 12 months after that crash. Unemployment peaked at 9 percent, two months after the stock market crashed-- and then began drifting generally downward over the next six months, falling to 6.3 percent by June 1930.
This was what happened in the market, before the federal government decided to "do something."
What the government decided to do in June 1930-- against the advice of literally a thousand economists, who took out newspaper ads warning against it-- was impose higher tariffs [the Smoot-Hawley Tariff], in order to save American jobs by reducing imported goods.
This was the first massive federal intervention to rescue the economy, under President Herbert Hoover, who took pride in being the first President of the United States to intervene to try to get the economy out of an economic downturn.
Within six months after this government intervention, unemployment shot up into double digits-- and stayed in double digits in every month throughout the entire remainder of the decade of the 1930s, as the Roosevelt administration expanded federal intervention far beyond what Hoover had started. …
While the market produced a peak unemployment rate of 9 percent-- briefly-- after the stock market crash of 1929, unemployment shot up after massive federal interventions in the economy. It rose above 20 percent in 1932 and stayed above 20 percent for 23 consecutive months, beginning in the Hoover administration and continuing during the Roosevelt administration.

Why do I believe that if government had stayed out of the way and did not seek to “fix” the markets or “protect American jobs” by enacting high tariffs? The 1929 market crash was not the first nor the last market meltdown. There was another later one which Thomas Sowell mentions in his column. It is all but forgotten, the crash of 1987. But unlike the crash of 1929 the government did not seek to fix the markets.
As Sowell says, The 1987 stock market crash was followed by two decades of economic growth with low unemployment. But that was only one difference. The other big difference was that the Reagan administration did not intervene in the economy after the 1987 stock market crash-- despite many outcries in the media that the government should "do something."

Now, I know you will either insultingly dismiss Sowell without even trying to address the substance of his argument or the facts he presents or completely ignore the his argument and the empirical data, but those who are open-minded will see with their own eyes just how intellectually dishonest you are and how blind you are to anything that challenges your delusions.

I remind you that "cuzz I said so isn't empirical data."

You are the one who plays that game Mike. Unlike you I present empirical data that actually support my claims rather than presenting Harvard studies that do not.

tashi deleks,

M

Originally Posted by michael h

Mahasattva has fled the debate so anyone challenging in economic debate is a bright change no matter how late.

:rolleyes: Or I was dealing with far more important problems in the real world. Ones that make this discussion petty and silly.

I'm against Obamacare

Wow! We agree on something!

as it will only feed corporate profits and it was a gift from Obama and the pubs to fatten their friends wallets.

Not one Republican voted for Obamacare. It passed when the Dems controlled the legislative and executive branches of government. We are seeing the negative effects of Obamacare all around us -- hint, the higher unemployment rate under Obama and declining GDP growth.

I was against the FED bailouts and government bailouts.

The bailouts were the work of Congressional and Executive action. It was the Fed’s ignorant monetary policy that was a “codeterminate” while it was the machinations of the Dems in Congress pushing their “affordable housing” dream on the market that caused the housing market collapse and financial market meltdown.

Socialism is a fantasy as we need only to see large corporate profits doubled since 2000, while the rest of the economy went in the crapper.

:rolleyes: False. The economy did not go into the “crapper” until the housing market collapsed and then was deepened by Obama’s ignorant economic policies and actions.

We traded for cheap goods from China and doubled corporate profits at the expense of small businesses,

What small business suffers from is government over regulation and a flawed tax policy -- not free trade with China.

high unemployment,

Caused by Obama.

GDP,

Our shrinking GDP growth has been due to Obama’s policies.

increased social services,

Federal overspending by Congress and made worse by Obama and the Dems (by 4x) and a complete disregard to the burdensome costs of the entitlement programs is saddling our children and grand children a bill that cannot be paid with stealing from the rich.

job growth, and lost government revenues.

Yep. Its called the Obama depression.

Judging by the results ... its not socialist and benefits a few, at the expense of many ... that's an elite and MNC agenda.

:rolleyes:

As to the start of the mess ... corporate lobbyists pushed this agenda through both parties ... its not a one party issue. Clinton drove this car.

More delusions brought to us by those who refuse to address the substance of any argument and ignores all empirical evidence that contradicts their cherished their willfully ignorant belief system. The current state of the economy is all Obama.

tashi deleks,

M

Originally Posted by Mahasattva

I know its hard for you to believe, but people have lives beyond this forum. Lives that are far more important than this forum.



As I have already told you, I have read the Harvard study that does not support your claims. It says nothing about the practice of outsourcing and never claims that our trade deficit “caused” the recession.



The Harvard study does present some good ideas regarding fiscal responsibilities and adjustments to the financial markets. It does not present anything that would have stopped the housing market collapse or the financial market meltdown.



:rolleyes: You do not debate Mike and neither does your new friend Mach. You ignore anything that challenges your dogma and post graphs that do not support your claims. You pick and chose data that hides the facts rather than present a reasoned rebuttal against the substance of any argument or evidence presented. You engage in personal attacks and never address the specifics of any counter argument presented. Mach believes he scores mythic points by presenting quotes by Galbraith that have nothing to do with the discussion or topic.



False. Your Harvard study never makes that claim Mike, and nothing in it refers to outsourcing. You have proved nothing but your ignorance and your blind fanatical faith in your delusions.



I presented empirical data gathered by economists that showed the benefits of free trade and the practice of out sourcing. I presented the real world facts gathered by respected journalists and pundits from both liberal and conservative perspectives. You ignored that empirical study that showed the benefits for all Americans of out sourcing (companies that engaged in it were able to expand their business and therefore able to hire more Americans than they would have ever if they had not). You never address the substance of the arguments presented and you ignore any empirical data that directly challenges your sacred cow and dismissively insult anyone who does not share your delusions.



What needs to happen is that governments across the global, especially America, need to live within their means. Your delusional fears over free trade are misguided and without foundation.



That’s right he didn’t and we don’t.



Why should I waste my time with you Mike? You ignore the facts that do not agree with your dogma. You do not understand the data you present, which is obvious when you attribute causal relations to the data you present where there is none.



:rolleyes: As has been pointed out to you, our current unemployment levels are due to Obama’s mismanagement and horrible non-leadership and have absolutely nothing to do with the practice of outsourcing.

Here's the recommendations of the Harvard study ... how is it that all the recommendations are related to the financial capital influx from Asian deficits?

These's the results ... does that sound like a codeterminant? Oh an the desire to squelch the benefit of capital ... with regulatory oversight. Yah that's nice.

What changes in the international financial system might mitigate global
imbalances in the future? We see at least two first-order agenda items.

The first is domestic financial development in the poorer economies. In some emerging-market countries, notably China, high saving is promoted by
underdevelopment and inefficiencies in financial markets. Structural shortcomings tend to raise both corporate and household saving rates. For example, if typical Chinese savers had access to relatively safe instruments offering higher rates of return, huge positive income effects would in all likelihood swamp substitution effects, resulting in lower, not higher, household saving. The result would be higher household welfare in China, as well as a reduction in China’s foreign surplus.

The second agenda item is the regulation of internationally integrated financial markets. Now that the fig leaf of constructive ambiguity has been torn away, development of a globally more effective framework for financial regulation is an urgent priority. It is well understood that a rational and politically robust regulatory framework will have to be based on more extensive international cooperation than currently exists –
notwithstanding the considerable progress made since the initiation of the Basel process in the 1970s. Given their significant and growing importance in world trade and finance, the emerging markets will rightly be full partners in any new arrangements.
As the 2009 Pittsburgh G-20 summit illustrated, however, international agreement on further concrete common measures is far away. While this is the case, large global imbalances will remain dangerous as possible manifestations of underlying financial excesses. Macro-prudential regulatory stringency that responds forcefully to financial
booms will be the most important lever for avoiding financial busts in the future. Some observers have suggested that emerging markets use countercyclically intensive regulatory oversight in response to big financial inflows (Mohan and Kapur 2009; Ocampo and Chiappe 2003). Richer countries can usefully apply the same precepts in the face of big current account deficits.

Originally Posted by Mahasattva

:rolleyes: As has been pointed out to you, our current unemployment levels are due to Obama’s mismanagement and horrible non-leadership and have absolutely nothing to do with the practice of outsourcing.



:rolleyes: Why do I believe that Smoot-Hawley Tariff was the actual cause of the depression of the 30s? Its what the data revels. You see its not the specific rate of a tax or a tariff alone that effects human action, it’s the changed rates relationship with other factors and conditions. Your buddy Mach thinks he has ended the discussion with his presentation of the different tariff rates by different countries, but like your use of your disingenuous and intellectually dishonest graphs about income distribution (income is not earned, not distributed) of family/households, it hides other facts that revel a far different picture. On page 77 of: Out of work: unemployment and ... - Google Books

You can see the: Estimated Monthly Unemployment November 1929-December 1939
__________________________________________________ ___________________________________
Year----Jan.-----Feb.-----March----April----May----June-----July-----Aug.-----Sept.-----Oct.-----Nov.-----Dec.
1929----------------------------------------------------------------------------------------------5.0------9.0
1930-----8.9------7.6-------7.6-----6.6-----6.8------6.3------7.8------6.4-------7.0-------6.1----11.6-----14.4
1931-----13.8----14.7------14.5----14.0----14.9-----15.0-----15.5----16.0------17.4------16.7----18.6-----19.8
1932-----19.7----20.4------21.1----21.7----23.7-----25.8-----25.8----26.4------27.9------25.6----23.2-----22.3
1933-----25.9----26.1------28.3----27.3----27.3-----24.9-----23.3----23.4------23.9------22.9----23.2-----22.4
1934-----21.2----20.3------20.0----21.4----21.0-----20.7-----21.8----22.3------23.5------23.5----23.2-----21.6
1935-----19.3----18.6------18.5----18.7----20.1-----19.4-----21.3----20.0------19.6------21.9----21.8-----20.2
1936-----18.7----18.0------19/4----18.4----20.1-----16.9-----16.0----16.1------15.0------17.7----13.9-----15.3
1937-----15.1----15.1------13.5----13.2----17.5-----13.6-----13.7----13.5------12.5------13.3----17.1-----18.9
1938-----17.4----18.8------19.2----20.1----20.1-----20.6-----19.9----20.2------19.5------17.1----17.7-----17.5
1939-----18.7----19.3------19.3----20.7----19.9-----18.5-----18.3----17.6------14.3------11.6----13.9-----14.4

As Sowell, points out in: Thomas Sowell: The myth of how the Great Depression was resolved | Thomas Sowell | Op Eds | Washington Examiner Those who think that the stock market crash in October 1929 is what caused the huge unemployment rates of the 1930s will have a hard time reconciling that belief with the data in that table.
Although the big stock market crash occurred in October 1929, unemployment never reached double digits in any of the next 12 months after that crash. Unemployment peaked at 9 percent, two months after the stock market crashed-- and then began drifting generally downward over the next six months, falling to 6.3 percent by June 1930.
This was what happened in the market, before the federal government decided to "do something."
What the government decided to do in June 1930-- against the advice of literally a thousand economists, who took out newspaper ads warning against it-- was impose higher tariffs [the Smoot-Hawley Tariff], in order to save American jobs by reducing imported goods.
This was the first massive federal intervention to rescue the economy, under President Herbert Hoover, who took pride in being the first President of the United States to intervene to try to get the economy out of an economic downturn.
Within six months after this government intervention, unemployment shot up into double digits-- and stayed in double digits in every month throughout the entire remainder of the decade of the 1930s, as the Roosevelt administration expanded federal intervention far beyond what Hoover had started. …
While the market produced a peak unemployment rate of 9 percent-- briefly-- after the stock market crash of 1929, unemployment shot up after massive federal interventions in the economy. It rose above 20 percent in 1932 and stayed above 20 percent for 23 consecutive months, beginning in the Hoover administration and continuing during the Roosevelt administration.

Why do I believe that if government had stayed out of the way and did not seek to “fix” the markets or “protect American jobs” by enacting high tariffs? The 1929 market crash was not the first nor the last market meltdown. There was another later one which Thomas Sowell mentions in his column. It is all but forgotten, the crash of 1987. But unlike the crash of 1929 the government did not seek to fix the markets.
As Sowell says, The 1987 stock market crash was followed by two decades of economic growth with low unemployment. But that was only one difference. The other big difference was that the Reagan administration did not intervene in the economy after the 1987 stock market crash-- despite many outcries in the media that the government should "do something."

Now, I know you will either insultingly dismiss Sowell without even trying to address the substance of his argument or the facts he presents or completely ignore the his argument and the empirical data, but those who are open-minded will see with their own eyes just how intellectually dishonest you are and how blind you are to anything that challenges your delusions.



You are the one who plays that game Mike. Unlike you I present empirical data that actually support my claims rather than presenting Harvard studies that do not.

tashi deleks,

M

I really don't see much support for the influence of Smoot Hawley being a factor ... other then a tick on an already sick dogs back. Foreign trade was a tiny contributor to GDP ... it hurt ... but not 28% unemployment hurt.

I do see a correlation between consumption and greedy wealth concentration.

Bank%20Failures.jpg

Great Depression - Wikipedia, the free encyclopedia

There were multiple causes for the first downturn in 1929. These include the structural weaknesses and specific events that turned it into a major depression and the manner in which the downturn spread from country to country. In relation to the 1929 downturn, historians emphasize structural factors like massive bank failures and the stock market crash. In contrast, economists (such as Barry Eichengreen, Milton Friedman and Peter Temin) point to monetary factors such as actions by the US Federal Reserve that contracted the money supply, as well as Britain's decision to return to the Gold Standard at pre–World War I parities (US$4.86:£1).

Current theories may be broadly classified into two main points of view and several heterodox points of view. First, there are demand-driven theories, most importantly Keynesian economics, but also including those who point to the breakdown of international trade, and Institutional economists who point to underconsumption and over-investment (causing an economic bubble), malfeasance by bankers and industrialists, or incompetence by government officials. The consensus among demand-driven theories is that a large-scale loss of confidence led to a sudden reduction in consumption and investment spending. Once panic and deflation set in, many people believed they could avoid further losses by keeping clear of the markets. Holding money became profitable as prices dropped lower and a given amount of money bought ever more goods, exacerbating the drop in demand.

Secondly, there are the monetarists, who believe that the Great Depression started as an ordinary recession, but that significant policy mistakes by monetary authorities (especially the Federal Reserve), caused a shrinking of the money supply which greatly exacerbated the economic situation, causing a recession to descend into the Great Depression. Related to this explanation are those who point to debt deflation causing those who borrow to owe ever more in real terms.

Lastly, there are various heterodox theories that downplay or reject the explanations of the Keynesians and monetarists. For example, some new classical macroeconomists have argued that various labor market policies imposed at the start caused the length and severity of the Great Depression. The Austrian school of economics focuses on the macroeconomic effects of money supply, and how central banking decisions can lead to over-investment (economic bubble).

So I observe the graph, unemployment increases until Mar 1933, peaking at 28.3%. FDR takes office and intervenes in the economy. Unemployment decreases to 13.2% in Apr 1937. Conservatives block legislation and unemployment increases.

So much for the theory of non intervention.

In his "first hundred days" in office, which began March 4, 1933, Roosevelt spearheaded major legislation and issued a profusion of executive orders that instituted the New Deal—a variety of programs designed to produce relief (government jobs for the unemployed), recovery (economic growth), and reform (through regulation of Wall Street, banks and transportation). The economy improved rapidly from 1933 to 1937, but then relapsed into a deep recession. The bipartisan Conservative Coalition that formed in 1937 prevented his packing the Supreme Court or passing any considerable legislation; it abolished many of the relief programs when unemployment diminished during World War II. Most of the regulations on business were ended about 1975–85, except for the regulation of Wall Street by the Securities and Exchange Commission, which still exists. Along with several smaller programs, major surviving programs include the Federal Deposit Insurance Corporation, which was created in 1933, and Social Security, which Congress passed in 1935

.

Smoot Hawley June 17, 1930, Republican Agenda

The House passed a version of the act in May 1929, increasing tariffs on agricultural and industrial goods alike. The House bill passed on a vote of 264 to 147, with 244 Republicans and 20 Democrats voting in favor of the bill.[6] The Senate debated its bill until March 1930, with many Senators trading votes based on their states' industries. The Senate bill passed on a vote of 44 to 42, with 39 Republicans and 5 Democrats voting in favor of the bill.[6] The conference committee then aligned the two versions, largely by moving to the greater House tariffs.[7] The House passed the conference bill on a vote of 222 to 153, with the support of 208 Republicans and 14 Democrats.

Foreign Trade was 4% to 5% of GDP, and incurred a loss of around 65%. Do the math. It's not the devastation your looking for. Make a note ... our tariffs were lower then the average of other countries.

However, the American Tariff League Study of 1951 which compared the effective tariff levels of 43 countries found that only seven countries had a lower tariff level than the U.S. (5.1%). Eleven countries had effective tariff rates higher than the Smoot-Hawley peak of 19.8% including the United Kingdom (25.6%). The 43-country average was 14.4% ± 0.9% higher than the U.S. level of 1929.

Smoot?Hawley Tariff Act - Wikipedia, the free encyclopedia

Imports during 1929 were only 4.2% of the United States' GNP and exports were only 5.0%. Monetarists such as Milton Friedman who emphasize the central role of the money supply in causing the depression, downplay the Smoot-Hawley's effect on the entire U.S. economy.

U.S. imports decreased 66% from US$4.4 billion (1929) to US$1.5 billion (1933), and exports decreased 61% from US$5.4 billion to US$2.1 billion, both decreases much more than the 50% decrease of the GDP.

michael,
Are you kidding yourself?
Do you think anything anybody has to say is going to swerve the mind of the Portfolio Conservative?

Forget about the fact that the economic theories he touts are tainted by human nature.