Does the size of the national debt really matter?

[EdwardBaiamonte]

So this is a cornerstone of the Ryan budget.

too stupid by 1000% and perfectly liberal!!! Jefferson believed in limited governemnt 200 years ago, Friedman 10 years ago, and Aristotle believed in it 2000 years ago!!

Rogoff believes in it too and even the corrected numbers show that he is correct!!

WSJ: 4/16/13 "On a cursory look, it seems that that Herndon Ash and Pollen also find lower growth when debt is over 90% (they find 0-30 debt/GDP , 4.2% growth; 30-60, 3.1 %; 60-90, 3.2%,; 90-120, 2.4% and over 120, 1.6%). These results are, in fact, of a similar order of magnitude to the detailed country by country results we present in table 1 of the AER paper, and to the median results in Figure 2. And they are similar to estimates in much of the large and growing literature, including our own attached August 2012 Journal of Economic Perspectives paper (joint with Vincent Reinhart)"

 

[idb]

So you're saying that government spending can produce benefits?

yes

Why only the military though?

dear, the military saved us from the Nazis!! How can you top that??????

Why not fund the military for it's core functions only

dear, its core function is to be able to win a war against a 2-3 nation attack.

and spend money encouraging private businesses by commissioning infrastructure projects or investing in R&D?

what?? infrastructure does not directly save us from the Nazis, and does not cause the invention of new products. New products got us from the stone age to here!

R&D???? Solyndra did lots of R&D with government help so it was not productive !!!

dear, the military saved us from the Nazis!! How can you top that??????

Haha! Hilarious point!

Is all the R&D carried out by Solyndra lost to humanity?
Did they produce no worthwhile information?

What is the return on military R&D budgets I wonder?
Could there be a more efficient use of government money than turning it over to the military and relying on them to carry on society's progress from the stone age?

The space program produced a few interesting products.

You'll need infrastructure to transport the tanks around the country the next time the Nazi hordes invade...or the North Koreans...or the Chinese...or the Iranians...or the Canadians.....

 

[EdwardBaiamonte]

Arindrajit Dube has a study out indicating that the causality is the reverse;

yes, it is obvious that liberal researchers can come to any conclusion they like, that liberals never want to reduce debt no matter what, and that it is silly to quibble about the Rogoff numbers when basic principles can't be agreed upon by economists.

This comports with the experience of the last five years.

a lie from a senile old liberal fart!!!

Simeon Dijankov:The evidence is to the contrary. The European Union economies that have experienced the highest growth in the past three years—Germany, Latvia, Lithuania, Poland and Sweden—all take austerity seriously. The European Commission's Winter 2013 forecast shows a similar trend. The five fastest-growing economies in Europe are projected to be Bulgaria, Estonia, Latvia, Lithuania and Romania—all fiscal hawks.

And remember that just about every other researcher who has looked at Rogoff's data and methodology believes that when appropriate corrections for his methodological errors are made (not just the "coding error" he has admitted to), his results about a 90% threshold disappear. Just throwing all the data for Australia, New Zealand, and Canada in that he inexplicably omitted makes a big difference. So I respectlully suggest that Rogoff has been caught cooking the data, has not responded to his critics, and that his protestations about still being right are factually wrong and self-serving.

dear, even the Umass economists who found the errors agree that the more debt the less growth!!!!! What planet are you on??

I'm not sure what you are driving at here. I don't want to rehash the whole Say's Law--"crowding-out effect" debate which is obviously not applicable to situations with high levels of underutilized resources such as we have now.

it very very very applicable!! if a libturd housing bubble created too many carpenters we need to let the free market figure out where they belong, and not let another libturd bubble misplace them again!!
Lets never forget that a recession is the time it takes for the free market to correct the effects of liberal distortions of the free market!!
Perhaps you can write that down 100 times so you won't forget it??

I also think what government spends money on (or private business for that matter) makes a difference. Waste is economically detrimental whether it is public or private; it distorts markets. Good investment projects promote long term growth, whether they are public or private.

as a liberal you portray perfect ignorance! When private money is wasted there is huge pain and suffering. When someone has lost his hard earned money he won't do it again! When a bureaucrat loses someone else's money there is little pain and a tendency to repeat the error! Do you ever wonder why no one ever washes a rented car? If its your car you care a lot more about it!!

Good statistical analysis can separate out the effects of various variables on a given dependent variable. Most people's eyes glaze over when they see the regression equations, but that's where the action is in econometrics!

dear, there is no action in that sphere, none!!!! They've had 100 years to make economics a hard science and they are no where near close as you indicated above where cause and effect can't even be agreed upon!!

what is science though is that when countries switch to capitalism they do better!!East/West Germany, Cuba,Fla., North/South Korea, Israel before/after 1999, Ghana/Ivory coast, Red China before and after communism, Hong Kong/Red China, Taiwan/Red China, El Salvadore before and after Funes . The list is endless. The more capitalism the better. Liberals lack the IQ to grasp what is simple for conservatives to grasp.

 

[EdwardBaiamonte]

Is all the R&D carried out by Solyndra lost to humanity?
Did they produce no worthwhile information?

dear, our soviet president just made the same mistake Stalin did. He was going to create the green jobs of the future and end the recession-remember???? All he did was exactly what Stalin did,namely, invest in companies that the free market would not invest in!! Sure they produced some information, but, you idiot, that does not justify a soviet libturd economy!!!

What is the return on military R&D budgets I wonder?

about 1 billion % since it saved the world from the Nazis!!! and is about to save us again, thanks to Star Wars, from Iran and North Korea!!

Could there be a more efficient use of government money than turning it over to the military and relying on them to carry on society's progress from the stone age?

dear, no one said they were responsible for all the progress from the stone age to here, just a tiny portion of it, and that is not bad for a government expenditure!!

The space program produced a few interesting products.

You'll need infrastructure to transport the tanks around the country the next time the Nazi hordes invade...or the North Koreans...or the Chinese...or the Iranians...or the Canadians.....

too stupid!! no one said we dont need roads!!!

 

[idb]

Simeon Dijankov:The evidence is to the contrary. The European Union economies that have experienced the highest growth in the past three years—Germany, Latvia, Lithuania, Poland and Sweden—all take austerity seriously. The European Commission's Winter 2013 forecast shows a similar trend. The five fastest-growing economies in Europe are projected to be Bulgaria, Estonia, Latvia, Lithuania and Romania—all fiscal hawks.

Have you looked up what those growth rates are?
Have you noticed that they're all less than the profligate US?

For example
Romania 0.2 for 2012, 1.3-1.6 for 2013

 

[idb]

Is all the R&D carried out by Solyndra lost to humanity?
Did they produce no worthwhile information?

dear, our soviet president just made the same mistake Stalin did. He was going to create the green jobs of the future and end the recession-remember???? All he did was exactly what Stalin did,namely, invest in companies that the free market would not invest in!! Sure they produced some information, but, you idiot, that does not justify a soviet libturd economy!!!

What is the return on military R&D budgets I wonder?

about 1 billion % since it saved the world from the Nazis!!! and is about to save us again, thanks to Star Wars, from Iran and North Korea!!

Could there be a more efficient use of government money than turning it over to the military and relying on them to carry on society's progress from the stone age?

dear, no one said they were responsible for all the progress from the stone age to here, just a tiny portion of it, and that is not bad for a government expenditure!!

The space program produced a few interesting products.

You'll need infrastructure to transport the tanks around the country the next time the Nazi hordes invade...or the North Koreans...or the Chinese...or the Iranians...or the Canadians.....

too stupid!! no one said we dont need roads!!!

"Soviet libturd economy"?
Is that an economic term?

Despite all your ridiculous shouting, why is the US doing better than the European economies while being in the grip of a Soviet Libturd Economy?

I note your regression to screaming abuse when inconsistencies in your argument are questioned.
I await your next tirade with amusement.

 

[jasonnfree]

Most homeowners have debt that exceeds income three or four fold. Whining about the debt is a republican favorite when a democrat's in the white house.

 

[jasonnfree]

Wouldn't it be more important where the government spending is going rather than the amount?

well, playing venture capitalist with our money and investing in Solyndras and many many others is certainly stupid regardless of the amount.

In a steep recession they should spend as little as conceivably possible, so business can spend more, and what they must spent should be on military since that at least protects us and may produce spin off benefits.

Solyndra was only a half billion dollars Edward. Not enough to make the world end tomorrow. It pales in comparison to what the unneeded Iraq war costs.

 

[Toddsterpatriot]

Most homeowners have debt that exceeds income three or four fold. Whining about the debt is a republican favorite when a democrat's in the white house.

And when they sell the house, they pay off the debt.

What should we sell to pay off our debt?

 

[oldfart]

It is commonly thought that the huge debt is a drag on the economy, Paul Ryan and the GOP have adopted this putative as a basis to attack Obama, toss Bush II under the bus and impede efforts to create jobs, stimulate the economy and repair, replace and renovate our aging infrastructure.

What if Ryan and the GOP are wrong?

See:

How a student took on eminent economists on debt issue - and won

Is it ethical for the US to spend more than it can feasibly pay back in the future?

When the debt grows so big that there's no conceivable way of paying back our lenders, who exactly loses out?

we all lose out because we have to pay off the debt in higher taxes rather than enjoy the money we earn! Plus, economic growth and our standard of living suffers as we have less saving and investment!

It would seem that way on the surface, Ed. But I think the truth runs deeper. There is no real way and economy can "save" for the future in the sense that financial entities can. Let me give an example. Suppose we want to live well in our old age and a part of that is reasonably priced, safe, nutritious food. Can we store up enough canned goods to supply our food wants in twenty years? Excluding a few survivalists and the Mormons, the answer is probably not. But we could invest in agricultural research, food storage and transportation facilities, and improved quality control. This would result in food being produced in twenty years that would be safer, cheaper, and higher quality.

So the key to an adequate supply of what we depend on for our standard of living in the future is not how much money we put away, but how that money is used by private concerns and government, i.e. investment. If that savings goes to create new and more bizarre financial instruments of mass destruction, our grandchildren might have to learn to eat tree bark. But if it is invested in meaningful research, public and private investment in factories, schools, nursing homes, and educating our workforce, we'll be OK.

The first path, unproductive spending public or private, only means fewer resources for the future, lower standards of living, and higher inflation as more people compete for fewer goods. The second path requires spending intelligently and leads to growth and higher standards of living.

 

[oldfart]

too stupid by 1000% and perfectly liberal!!! Jefferson believed in limited governemnt 200 years ago, Friedman 10 years ago, and Aristotle believed in it 2000 years ago!!

And you were doing so well for awhile there Ed! You're slipping a bit; Friedman's opus "Capitalism and Freedom" came out in 1962, and yes, I read it soon after without being required to for a course. He makes a pretty good case for a limited role for government, but he advocates far more government intervention in the economy than the Right is comfortable with today. It's worth a re-read for both of us. [/quote]

Rogoff believes in it too and even the corrected numbers show that he is correct!!

I'm not sure Rogoff believes in limited government in the way you define it.

WSJ: 4/16/13 "On a cursory look, it seems that that Herndon Ash and Pollen also find lower growth when debt is over 90% (they find 0-30 debt/GDP , 4.2% growth; 30-60, 3.1 %; 60-90, 3.2%,; 90-120, 2.4% and over 120, 1.6%). These results are, in fact, of a similar order of magnitude to the detailed country by country results we present in table 1 of the AER paper, and to the median results in Figure 2. And they are similar to estimates in much of the large and growing literature, including our own attached August 2012 Journal of Economic Perspectives paper (joint with Vincent Reinhart)"

I'm assuming the WSJ is quoting Rogoff in this quote. Needless to say, Rogoff denies that other researchers come up with different numbers than his when his bizarre methodology is removed. He only corrects for the "coding error", not for the inexplicable omissions of Australia, New Zealand, and Canada 1946--1950 or the bizarre weighting conventions. He is still cooking the books, so of course his results remain pretty much the same. His figures fall apart when anyone corrects for his mistakes.

Ed, can you find anyone who uses standard methodology who comes up with figures anywhere close to R--R's? I haven't found any.

Any you really need to drop the constant use of the "too stupid" comment. It makes you sound like an idiot even when you are making an otherwise good argument.

Jamie

 

[EdwardBaiamonte]

he advocates far more government intervention in the economy than the Right is comfortable with today. It's worth a re-read for both of us.

dear, he wanted a computer to control the Fed, and vouchers for education and health care. Sounds like you should re read without prejudice this time!

Rogoff believes in it too and even the corrected numbers show that he is correct!!

I'm not sure Rogoff believes in limited government in the way you define it.

he knows the proper direction; that's what is most important. I'm sure he fakes being closer to the middle for professional reasons


WSJ: 4/16/13 "On a cursory look, it seems that that Herndon Ash and Pollen also find lower growth when debt is over 90% (they find 0-30 debt/GDP , 4.2% growth; 30-60, 3.1 %; 60-90, 3.2%,; 90-120, 2.4% and over 120, 1.6%). These results are, in fact, of a similar order of magnitude to the detailed country by country results we present in table 1 of the AER paper, and to the median results in Figure 2. And they are similar to estimates in much of the large and growing literature, including our own attached August 2012 Journal of Economic Perspectives paper (joint with Vincent Reinhart)"[/quote]

I'm assuming the WSJ is quoting Rogoff in this quote. Needless to say, Rogoff denies that other researchers come up with different numbers than his when his bizarre methodology is removed. He only corrects for the "coding error", not for the inexplicable omissions of Australia, New Zealand, and Canada 1946--1950 or the bizarre weighting conventions. He is still cooking the books, so of course his results remain pretty much the same. His figures fall apart when anyone corrects for his mistakes.

don't you read English?? Herndon Ash and Pollen also find lower growth when debt is over 90% (they find 0-30 debt/GDP , 4.2% growth; 30-60, 3.1 %; 60-90, 3.2%,; 90-120, 2.4% and over 120, 1.6%).

The corrected numbers change the force of the conclusion but not the conclusion. So the recommendation is still to cut government debt!!
As a family is better off with less debt so is the nation or the families that make up the taxpayer nation!!

Ed, can you find anyone who uses standard methodology who comes up with figures anywhere close to R--R's? I haven't found any.

Herndon Ash and Pollen also find lower growth when debt is over 90% (they find 0-30 debt/GDP , 4.2% growth; 30-60, 3.1 %; 60-90, 3.2%,; 90-120, 2.4% and over 120, 1.6%).

Any you really need to drop the constant use of the "too stupid" comment. It makes you sound like an idiot even when you are making an otherwise good argument.
Jamie

sadly is seems to apply to you often because you try so hard to be an objective liberal without the IQ to see that its impossible!

 

[EdwardBaiamonte]

There is no real way and economy can "save" for the future in the sense that financial entities can.

why not take Econ 101?? S=I. When an individual saves his money financial entities invest it. Did you think investment money came from the investment fairy??

Let me give an example. Suppose we want to live well in our old age and a part of that is reasonably priced, safe, nutritious food. Can we store up enough canned goods to supply our food wants in twenty years?

no, but so what?????? We can store money in a bank and then buy food when needed!!

But we could invest in agricultural research, food storage and transportation facilities, and improved quality control. This would result in food being produced in twenty years that would be safer, cheaper, and higher quality.

all agree but so what????????????????????????????????

So the key to an adequate supply of what we depend on for our standard of living in the future is not how much money we put away, but how that money is used by private concerns and government, i.e. investment.

too stupid, food is cheaply and efficiently produced now!! The real issue is whether we have money saved to buy it in the future not whether the production of food gets more and more efficient!!

If that savings goes to create new and more bizarre financial instruments of mass destruction, our grandchildren might have to learn to eat tree bark. But if it is invested in meaningful research, public and private investment in factories, schools, nursing homes, and educating our workforce, we'll be OK.

too stupid!! no one suggested our savings should be wasted or would be???? Do you have any idea at all what you are talking about????

The first path, unproductive spending public or private, only means fewer resources for the future, lower standards of living, and higher inflation as more people compete for fewer goods. The second path requires spending intelligently and leads to growth and higher standards of living.

If I disagreed I'll pay you $10,000. Bet or admit your talking pure gibberish

 

[idb]

There is no real way and economy can "save" for the future in the sense that financial entities can.

why not take Econ 101?? S=I. When an individual saves his money financial entities invest it. Did you think investment money came from the investment fairy??

Or...maybe you could read a dictionary to find the difference between an economy and a financial entity.

See why we are 100% sure that "EdwardBaiamonte" is a euphemism for "trying too hard"?

 

[EdwardBaiamonte]

There is no real way and economy can "save" for the future in the sense that financial entities can.

why not take Econ 101?? S=I. When an individual saves his money financial entities invest it. Did you think investment money came from the investment fairy??

Or...maybe you could read a dictionary to find the difference between an economy and a financial entity.

????????