'Five Zombie Economic Ideas That Refuse to Die'

Discussion in 'Economy' started by midcan5, Oct 26, 2010.

  1. midcan5
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    midcan5 liberal / progressive

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    "Two years after the financial crisis, the U.S. economy has steered clear of total disaster, with the Dow Jones industrial average currently near its pre-crash level. But the theories that caused it all are still out there, lurking in the shadows."

    By John Quiggin

    This was my favorite, you read it everyday on USMB.

    "The Trickle-Down Hypothesis: the idea that policies that benefit the wealthy will ultimately help everybody.

    Unlike some of the zombie ideas discussed here, trickle-down economics has long been with us. The term itself seems to have been coined by cowboy performer Will Rogers, who observed of U.S. President Herbert Hoover's 1928 tax cuts: "The money was all appropriated for the top in the hopes that it would trickle down to the needy. Mr. Hoover ... [didn't] know that money trickled up.""

    Five Zombie Economic Ideas That Refuse to Die - By John Quiggin | Foreign Policy

    Five Zombie Economic Ideas That Refuse to Die - By John Quiggin | Foreign Policy
     
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  2. CrusaderFrank
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    CrusaderFrank Diamond Member

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    Massive Keynesians government deficit fuel economic growth and lower unemployment is #1, amiright?
     
  3. loosecannon
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    loosecannon Senior Member

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    The hardship of the great recession is minor in the face of recognizing that as a rule we have not only learned nothing from the event, but we have actually reinforced in our conventional wisdom the very ideas that caused the crisis.

    Economists esp seem to have failed entirely to recognize the fallacies of their own ideologies exposed. Like Monetarism has been proven to be a flawed, nearly useless mechanism.

    If we can't learn from our mistakes there is no hope. We are doomed to fail by our own efforts.
     
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  4. antagon
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    antagon The Man

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    crisis is an invitation for economists to say i told you so. looking at the vulture-like feeding frenzy which economic idealogues have turned the great depression into, i've got no doubt that the same will befall the great recession. each will dawn shades to see their economic religion tinted in rose.

    they'll nearly all be right until they suggest actual policy.
     
  5. Toro
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    Toro Diamond Member

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    I agree with four of the five "myths." I disagree with the comment about privatization. Privatization doesn't work in all cases, but it usually does. There are some functions that should remain within government, but government generally does a poor job allocating capital. That should be done primarily by the private sector.
     
  6. antagon
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    antagon The Man

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    good lineup in this article. i'd add the myth that there is a correlation between economic liberation and economic returns, then remind the author that the baby's in the bathwater before he chucks out all of these theories in their entirety.
     
  7. loosecannon
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    loosecannon Senior Member

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    You really know how to cheer a guy up.....

    Economists and financiers are both threats to our survival. That's the real lesson here.
     
  8. loosecannon
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    loosecannon Senior Member

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    bubbles.

    That is how the private sector allocates capital.

    Rational market theory and efficient market theory have been exposed as fraud, imo.
     
  9. loosecannon
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    loosecannon Senior Member

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    liberation or liberalization?

    As per baby/bathwater....a lot of ideas work well at an appropriate scale but fail miserably when they exceed their scope.

    But the world economy is more than a drive train, it is our survival mechanism. We, the 7 billion, deserve a lot more than to have our very means of survival upended by folks whose only concern is short term personal gain.

    That IS The very foundation of society.

    I would rather suffer no law and no rule of law replete with mob rule and gang rule than to suffer no accountability by the overlords of our economy. The latter are the more dangerous. IMO.
     
  10. antagon
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    antagon The Man

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    liberalization i guess... with the same baby/bathwater caveat.
     

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