The single most important phrase in economics is....

[Brutus]

we're done because the Congressional Record is right?

We're done because in that CR the term "Republican" is short for "Democratic-Republican,"

of course if so you would present a primary source to prove it rather than pretend like a small child you are right in the face of evidence.

"Although people were still deeply ambivalent about political parties, although one party did not necessarily recognize the legitimacy of the other, and although men on both sides were nostalgic- at one time or another- for the imaginary golden age of political harmony, few people could be found in the early 1790's who believed the parties did not exist. The parties had names: Federalist and Republican."-Susan Dunn, Jefferson's Second Revolution.

and because you are pretending to be so incredibly STUPID that you actually believe this party is the same one as the Republican Party which was founded in 1854 and whose first president was Abraham Lincoln.

if I said anything about 1854 or Lincoln I'll pay you 10,000. Bet or run away again with your liberal tail between you legs

 

[Uncensored2008]

That's not a phrase in economics, either.

Nor is it true.

Yeah, actually it IS true.

 

[Nosmo King]

"prime the pump" is perhaps the key phrase in all of economics. When you prime a water pump you get it started with a little water and then it runs on its own.

But, when the liberal primes the economy with federal spending it merely creates a bubble not related to or attached to the broader economy and so is not able to pull the broader economy along.

Worse, the bubble bursts causing a depression in the bubble area leaving it worse off than before, plus, the taxation necessary to finance the bubble further recesses the broader economy that was taxed to finance the bubble.

Now we can understand the futility of Keynesian "prime the pump" economics and the futility of using Obama's stimulus bubble to fix the housing bubble.

Ideally we want minimal taxation and Keynesian interference so the free market will organize the economy in the most efficient way possible.

Makes sense so long as credit is available. But once the banks stop lending, there can be only one entity to prime the pump and that's the state.

 

[Brutus]

Makes sense so long as credit is available. But once the banks stop lending, there can be only one entity to prime the pump and that's the state.

of course thats idiotic and liberal and shows that as a liberal you lacked the IQ to comprehend the post to which you are responding.

1) the government can't prime the pump since there is no pump. Re-read

2) when it tries it only creates a bubble that makes things worse

3) if a bank won't or can't sell money or a car company wont or can't sell cars it is because government has interfered with the economy and prevented people from doing what they are in business to do.
I know thats way way over your head, but at least I tried

 

[Dragon]

Yeah, actually it [you can't spend your way to prosperity] IS true.

No. We did exactly that in the 1940s. The problem in the 1930s was exactly that consumers weren't spending enough (because they didn't have enough to spend). We have the same problem now.

A nation can indeed spend its way to prosperity when faced with a situation like that.

Brutus: you're on ignore. As I said, you're an obvious troll, and we're done.

 

[Nosmo King]

Makes sense so long as credit is available. But once the banks stop lending, there can be only one entity to prime the pump and that's the state.

of course thats idiotic and liberal and shows that as a liberal you lacked the IQ to comprehend the post to which you are responding.

1) the government can't prime the pump since there is no pump. Re-read

2) when it tries it only creates a bubble that makes things worse

3) if a bank won't or can't sell money or a car company wont or can't sell cars it is because government has interfered with the economy and prevented people from doing what they are in business to do.
I know thats way way over your head, but at least I tried

You're too short for that gesture~ Addison DeWitt

 

[Brutus]

A nation can indeed spend its way to prosperity when faced with a situation like that.

1) for the government to spend it must tax people who then can't spend so there is no net new spending or prosperity, just a government bubble, like the housing bubble, that must burst to make things worse not better. Now you understand how FDR prolonged the Depression for 10 years and how BO is prolonging the Great Recession.

This is a huge huge day for you!!



Econ 101!! Sorry

 

[Uncensored2008]

No. We did exactly that in the 1940s.

In fact we did not.

We removed about 30% of the workforce from the economy and substantially SHRANK the commodity markets available to consumers by diverting critical resources to the government war effort.

The problem in the 1930s was exactly that consumers weren't spending enough (because they didn't have enough to spend). We have the same problem now.

Complete nonsense.

The idea that consumer spending increased during WWII, amidst rationing of goods and the divergence of 30% of the workforce to foreign shores is far too absurd for words. GNP rose as a matter of war spending, but consumer spending declined

Look, I realize that WWII is the wetdream that Keynesians point to as validation of their hypothesis, but as is the way of such things, it simply isn't grounded in fact.

Keynes based his theory of altering the business cycle through deficit spending on the concept of the multiplier effect. I have challenged supporters of Keynesian stimulus repeatedly to demonstrate the multiplier in effect. Demonstrate through GDP figures that TARP of Porkulus spawned even a paltry 3X multiplier? You can't, we both know you can't. As Dr. Rothbard so thoroughly demonstrated in the 80's, Keynesian theory is predicated on charts, graphs and arcane formula for the purpose of baffling with bullshit. Stripped to actual metrics, no one has or can show that deficit spending has an effect of even one dime beyond the principle expended.

A nation can indeed spend its way to prosperity when faced with a situation like that.

Then you should have no problem running up your credit cards to make yourself wealthy beyond all imagining.

 

[Brutus]

Makes sense so long as credit is available. But once the banks stop lending, there can be only one entity to prime the pump and that's the state.

of course thats idiotic and liberal and shows that as a liberal you lacked the IQ to comprehend the post to which you are responding.

1) the government can't prime the pump since there is no pump. Re-read

2) when it tries it only creates a bubble that makes things worse

3) if a bank won't or can't sell money or a car company wont or can't sell cars it is because government has interfered with the economy and prevented people from doing what they are in business to do.
I know thats way way over your head, but at least I tried

You're too short for that gesture~ Addison DeWitt

I see that as a liberal your economic knowledge is exactly 0.0

Do you think no one noticed that you tried to change the subject with an insult?

Can you find even one liberal who can respond to the OP with a tiny bit of intelligence? What does that tell you about liberalism?

 

[OohPooPahDoo]

"prime the pump" is perhaps the key phrase in all of economics. When you prime a water pump you get it started with a little water and then it runs on its own.

But, when the liberal primes the economy with federal spending it merely creates a bubble not related to or attached to the broader economy and so is not able to pull the broader economy along.

Worse, the bubble bursts causing a depression in the bubble area leaving it worse off than before, plus, the taxation necessary to finance the bubble further recesses the broader economy that was taxed to finance the bubble.

Now we can understand the futility of Keynesian "prime the pump" economics and the futility of using Obama's stimulus bubble to fix the housing bubble.

Ideally we want minimal taxation and Keynesian interference so the free market will organize the economy in the most efficient way possible.

Really? Did the unprecedented levels of deficit spending during the 40's cause a depression in the 50's? I missed that one in history.

 

[Uncensored2008]

Really? Did the unprecedented levels of deficit spending during the 40's cause a depression in the 50's? I missed that one in history.

I take it that you smoked dope as your major in Jr. High, and couldn't be bothered with High School, right?

You voted for Obama, several times, right?

 

[Dragon]

We removed about 30% of the workforce from the economy and substantially SHRANK the commodity markets available to consumers by diverting critical resources to the government war effort.

"Consumption" means that somebody buys something. It doesn't have to be an individual buying a product. The government buying a product is also consumption. And we did not remove 30% of the workforce from the economy; in the first place, with the unemployment rate at about 10% in 1942, almost all of the men drafted or enlisted into the armed services are accounted for by the formerly unemployed (who were not "removed from the economy" because they weren't in it to begin with), and those working in defense industries were not "removed from the economy" because they were still producing for a crucial purpose.

In any case, the effect of all this came from government spending on a huge scale. Prior to the war, unemployment was high; during the war, it was nearly nonexistent; prior to the war, sales were slack; during the war, they boomed. For four years most Americans had good jobs (if sometimes lethal ones) at good wages, and consumer demand increased dramatically. For that reason, after the war, factories quickly retooled from making military equipment to making consumer goods, because all that demand created a high incentive. The Great Depression was over.

We spent our way to prosperity. There is really no other way to describe it.

Then you should have no problem running up your credit cards to make yourself wealthy beyond all imagining.

If I were a nation, that would be true.

 

[OohPooPahDoo]

Really? Did the unprecedented levels of deficit spending during the 40's cause a depression in the 50's? I missed that one in history.

I take it that you smoked dope as your major in Jr. High, and couldn't be bothered with High School, right?

You voted for Obama, several times, right?

So government spending was at record lows in the 40's? wow. who knew.

 

[OohPooPahDoo]

No. We did exactly that in the 1940s.

In fact we did not.

We removed about 30% of the workforce from the economy and substantially SHRANK the commodity markets available to consumers by diverting critical resources to the government war effort.

Bullshit. The government put everyone to work. The able bodied men were drafted and their housewives took their places in the factories. Anyone who wanted a paycheck and was willing to work could get one. When the war ended and all the troops came home, they SPENT, resulting in an economic boom.

The problem in the 1930s was exactly that consumers weren't spending enough (because they didn't have enough to spend). We have the same problem now.

Complete nonsense.

The idea that consumer spending increased during WWII, amidst rationing of goods and the divergence of 30% of the workforce to foreign shores is far too absurd for words. GNP rose as a matter of war spending, but consumer spending declined

Look, I realize that WWII is the wetdream that Keynesians point to as validation of their hypothesis, but as is the way of such things, it simply isn't grounded in fact.

Keynes based his theory of altering the business cycle through deficit spending on the concept of the multiplier effect. I have challenged supporters of Keynesian stimulus repeatedly to demonstrate the multiplier in effect. Demonstrate through GDP figures that TARP of Porkulus spawned even a paltry 3X multiplier? You can't, we both know you can't. As Dr. Rothbard so thoroughly demonstrated in the 80's, Keynesian theory is predicated on charts, graphs and arcane formula for the purpose of baffling with bullshit. Stripped to actual metrics, no one has or can show that deficit spending has an effect of even one dime beyond the principle expended.

We're not talking about theory. We're talking about reality. Why do righties insist on talking about theory instead of actual historical fact? WW II came. The government spend a ton of money and everyone could find work. The war ended. Economic prosperity followed.

A nation can indeed spend its way to prosperity when faced with a situation like that.

Then you should have no problem running up your credit cards to make yourself wealthy beyond all imagining.

Your comment doesn't even make sense. Its obvious a single person running up their credit cards isn't going to save an economy, and even if millions did it, they'd be piling up high interest debt. The interest burden on government debt, on the other hand, is absurdly low. The average interest the government pays on its outstanding debt is like 3%. Obviously, economic stimulation through low interest debt is better than economic stimulation through high interest debt.

 

[Uncensored2008]

"Consumption" means that somebody buys something.

That's nice.

Labor means that someone does something. Still, digging a hole and filling it does not create an economic boom.

It doesn't have to be an individual buying a product. The government buying a product is also consumption. And we did not remove 30% of the workforce from the economy; in the first place, with the unemployment rate at about 10% in 1942, almost all of the men drafted or enlisted into the armed services are accounted for by the formerly unemployed (who were not "removed from the economy" because they weren't in it to begin with), and those working in defense industries were not "removed from the economy" because they were still producing for a crucial purpose.

If the claim is an increase in consumer spending, which was the claim, then yes, it does have to be from consumers, not government.

In any case, the effect of all this came from government spending on a huge scale.

What 'effect," precisely?

Prior to the war, unemployment was high; during the war, it was nearly nonexistent;

Removing 30% of the workforce surprisingly can wipe out even a 26% unemployment rate - isn't that amazing?

prior to the war, sales were slack; during the war, they boomed.

Bullshit.

Consumer items were completely decimated. Materials needed to manufacture consumer goods were diverted to military production. Even IF the Keynesian stimulus had worked, there were no consumer goods to buy.

Your claim is simply false.

For four years most Americans had good jobs (if sometimes lethal ones) at good wages, and consumer demand increased dramatically.

Utter bullshit.

Consumer demand was non-existent and basic goods were rationed.

You are simply making shit up to support your failed theory.

For that reason, after the war, factories quickly retooled from making military equipment to making consumer goods, because all that demand created a high incentive. The Great Depression was over.

After the war, the infrastructure of Europe was destroyed, allowing the USA to emerge as the only viable production center.

We spent our way to prosperity. There is really no other way to describe it.

You are spewing bullshit from the perspective of taking your desired results and simply fabricating nonsense in support of the desired conclusion.

What you post is utter idiocy.

If I were a nation, that would be true.

ROFL

Say goodnight, Gracie....

 

[Uncensored2008]

So government spending was at record lows in the 40's? wow. who knew.

Have another bong load, sparky.

 

[OohPooPahDoo]

"Consumption" means that somebody buys something.

That's nice.

Labor means that someone does something. Still, digging a hole and filling it does not create an economic boom.

Not by itself.

But if someone who has a bunch of money that they aren't using pays someone to dig a hole and fill it back up - and that hole digger spends that money - then the money is in the economy when it otherwise might not be.

Its inarguable that from a global perspective no war is economically efficient - you're paying people to destroy things that economies have already created - but when you pay for it with money that wouldn't otherwise be spent, and the folks you pay spend that money - then more money is in the economy and wages and prices go up.

 

[Dragon]

Labor means that someone does something. Still, digging a hole and filling it does not create an economic boom.

Sometimes it can. It depends on the circumstances in which the person is hired to do it.

If the claim is an increase in consumer spending, which was the claim, then yes, it does have to be from consumers, not government.

The claim was that in the 1940s, we spent our way to prosperity. In fact, there was an increase in consumer spending in 1942-1945 compared to the years before, even with rationing, because of the fact that we had full employment. People with jobs have money to spend. They may not have bought a lot of new cars and refrigerators, but just being able to buy food, go to the movies, buy new clothes, and buy radios helped boost the economy. And of course after the war was over they spent even more.

What 'effect," precisely?

Full employment for four years.

Removing 30% of the workforce surprisingly can wipe out even a 26% unemployment rate - isn't that amazing?

Funny, I thought it was the Germans who were gassing people and sending them to the crematoria, not the U.S. . . .

Those workers were not dead, and they were working, therefore they were not "removed from the workforce." Good grief.

Consumer items were completely decimated.

Not true. Sales of consumer items during the war increased even with rationing.

After the war, the infrastructure of Europe was destroyed, allowing the USA to emerge as the only viable production center.

Commonly stated, but false. Most industrial powers emerged from the war with their industrial capacity virtually untouched. Most British factories were located in northern England, beyond the range of the Luftwaffe. France fell so quickly that French industry never suffered much from German bombing or shelling. Same with Norway and the Low Countries. The railroads were torn up by the Allied and Soviet invasions, true, but those were quickly repaired. Of the pre-war industrial powers, only Germany and Japan suffered significant damage to their industrial capacity, and even they were fully in the game by the end of the 1950s.

The remainder of your post is only empty rhetoric devoid of any rational content and needs no reply, but I should probably expand on one thing I said to which you responded with, essentially, nothing.

If I were a nation, I could indeed spend my way to prosperity on a credit card. I can't precisely because I am NOT a nation: I am an individual, which means I am mortal, and will retire someday, and so my income will not continue indefinitely and grow without expected end. If that weren't true -- if I were immortal and could confidently expect to make more money tomorrow than I do today -- then I could borrow money and roll it over indefinitely, as long as my total debt/income ratio did not get out of hand.

The rules that apply to an individual or to a household don't apply to a nation for that reason. A nation is immortal. An individual or a household is not.

 

[Uncensored2008]

Bullshit. The government put everyone to work.

No, the government took 30% of the labor force and sent them to war in Europe and Asia.

The able bodied men were drafted and their housewives took their places in the factories. Anyone who wanted a paycheck and was willing to work could get one. When the war ended and all the troops came home, they SPENT, resulting in an economic boom.

Economic boom?

ROFL

We're not talking about theory. We're talking about reality.

So you can show that increase in GDP exceeds the principle amounts of Porkulus by a given multiplier?

I await your proofs eagerly.

Why do righties insist on talking about theory instead of actual historical fact? WW II came. The government spend a ton of money and everyone could find work. The war ended. Economic prosperity followed.

ROFL

War is not a time of plenty, despite what the uneducated claim. WWII was marked by severe depredation that Americans had not seen since the 1930. Americans were told to "tighten their belts" in support of the war effort, and that's exactly what they did.

Your little game of rewriting history to portray the war as a time of plenty is not just dishonest, but insulting to the millions who sacrificed as a matter of patriotic duty. Look, I realize that you're just making shit up because you think it serves your party, but you defame the sacrifice of a lot of good people in doing so.

Your comment doesn't even make sense.

Your economic ignorance makes less sense.

Its obvious a single person running up their credit cards isn't going to save an economy, and even if millions did it, they'd be piling up high interest debt.

Adding debt does not increase the economic health of entities, neither individuals nor states.

Those who claim that it does are charlatans, those who believe them are fools.

The interest burden on government debt, on the other hand, is absurdly low.

Whew, then adding another $6 trillion in debt will have no negative impact. Everyone can relax.

The average interest the government pays on its outstanding debt is like 3%.

Oh, so only $420 billion a year in interest, chump change...

Obviously, economic stimulation through low interest debt is better than economic stimulation through high interest debt.

Yes, cutting your arm off with a sharp knife IS better than cutting it off with a dull knife. Quite the astute observation.

Fair warning, should you land in my Intro to Macro Econ class, I will fail you, should you provide answers such as those you listed here.

 

[Uncensored2008]

Not by itself.

But if someone who has a bunch of money that they aren't using pays someone to dig a hole and fill it back up - and that hole digger spends that money - then the money is in the economy when it otherwise might not be.

A young hoodlum, say, heaves a brick through the window of a baker’s shop. The shopkeeper runs out furious, but the boy is gone. A crowd gathers, and begins to stare with quiet satisfaction at the gaping hole in the window and the shattered glass over the bread and pies. After a while the crowd feels the need for philosophic reflection. And several of its members are almost certain to remind each other or the baker that, after all, the misfortune has its bright side. It will make business for some glazier. As they begin to think of this they elaborate upon it. How much does a new plate glass window cost? Two hundred and fifty dollars? That will be quite a sun. After all, if windows were never broken, what would happen to the glass business? Then, of course, the thing is endless. The glazier will have $250 more to spend with other merchants, and these in turn will have $250 more to spend with still other merchants, and so ad infinitum. The smashed window will go on providing money and employment in ever-widening circles. The logical conclusion from all this would be, if the crowd drew it, that the little hoodlum who threw the brick, far from being a public menace, was a public benefactor.

Now let us take another look. The crowd is at least right in its first conclusion. This little act of vandalism will in the first instance mean more business for some glazier. The glazier will be no more unhappy to learn of the incident than an undertaker to learn of a death. But the shopkeeper will be out $250 that he was planning to spend for a new suit. Because he has had to replace the window, he will have to go without the suit (or some equivalent need or luxury). Instead of having a window and $250 he now has merely a window. Or, as he was planning to buy the suit that very afternoon, instead of having both a window and a suit he must be content with the window and no suit. If we think of him as part of the community, the community has lost a new suit that might otherwise have come into being, and is just that much poorer.

The glazier’s gain of business, in short, is merely the tailor’s loss of business. No new “employment” has been added. The people in the crowd were thinking only of two parties to the transaction, the baker and the glazier. They had forgotten the potential third party involved, the tailor. They forgot him precisely because he will not now enter the scene. They will see the new window in the next day or two. They will never see the extra suit, precisely because it will never be made. They see only what is immediately visible to the eye.*

excerpts from ECONOMICS IN ONE LESSON by Henry Hazlitt

Its inarguable that from a global perspective no war is economically efficient - you're paying people to destroy things that economies have already created - but when you pay for it with money that wouldn't otherwise be spent, and the folks you pay spend that money - then more money is in the economy and wages and prices go up.