Progressives and Economics: Oil and Water

[PoliticalChic]

As the saying goes, "Not facts, nor data, nor experience, nor rational debate will convince Liberals."
And nowhere is this more true than in the field of economics.

From FDR extending the recession into 'The Great Depression," and extending the time it burdened the American population, to Obama's 'Stimulus,' Liberals/Progressives speak Swahili better than they plan economic policies.



A few examples of ineptitude.

1. Roosevelt's Director of the Bureau of the Budget, Lewis W. Douglas, said this about FDR's regime:"...a tyrannical, oppressive bureaucracy controlling our lives, destroying progress, depressing the standard of living..."
FromThe Liberal Tradition: A Free People and a Free Economyby Lewis W. Douglas, as quoted in "Monetary Central Planning and the State, Part XIV: The New Deal and Its Critics," byRichard M. Ebeling inFreedom Daily, February 1998, p. 12.


2. It was not capitalism that failed...but government regulation...
"Almost all the failed banks were in states with unit banking laws" — laws that prohibited banks from opening branches and thereby diversifying their portfolios and reducing their risks. Powell writes: "Although the United States, with its unit banking laws, had thousands of bank failures, Canada, which permitted branch banking, didn't have a single failure ...".'
"FDR's Folly: How Roosevelt and His New Deal Prolonged the Great Depression," p. 32, By Jim Powell



3."... the nation’s first comprehensive minimum wage law in 1938. .... The minimum wage law prices many of the inexperienced, the young, the unskilled and the disadvantaged out of the labor market. (For example, the minimum wage provisions passed as part of another act in 1933 threw an estimated 500,000 blacks out of work)
Benjamin M. Anderson,Economics and the Public Welfare: A Financial and Economic History of the United States, 1914-46, 2nd edition (Indianapolis: Liberty Press, 1979), p. 336.





Limitations of time and space preclude a discussion of the immense failure of 50 years of Liberal welfare policy, and the $22 trillion it has cost the economy.



Successes by Liberals/Progressives in the realm of economics are as rare as hen's teeth.

 

[AquaAthena]

And here is what drives liberals:

"Socialism is a philosophy of *failure, the *creed of ignorance, and the *gospel of envy, its inherent virtue is the equal sharing of misery." —Winston Churchill

 

[CrusaderFrank]

Progressive economics is failing everywhere on the planet: Greece, Detroit and the USA. The Chinese, Vietnamese and Russians are laughing at our Progressives for openly embracing, longing for, pining for a system they rejected as a 100% Failure

 

[PoliticalChic]

Progressive economics is failing everywhere on the planet: Greece, Detroit and the USA. The Chinese, Vietnamese and Russians are laughing at our Progressives for openly embracing, longing for, pining for a system they rejected as a 100% Failure

"Progressive economics is failing everywhere on the planet....a 100% Failure."

Here's the worst part: they just don't care.

 

[PoliticalChic]

And how about Obama's failed "Stimulus"....a waste of $831 billion?


4. "The U.S. unemployment rate, which had risen from 4.7% in November 2007 to 7.3% by December 2008, would go on to climb to 10% in October 2009. Even today– 5 years later– the unemployment rate remains at 7.6%, far above its historical average, and above the most recent value reported at the time Reinhart and Rogoff issued their warning."
The contributions of Reinhart and Rogoff Econbrowser


a. Support for Obama's Stimulus can be found in Reinhart's and Rogoff's, claims that continued unemployment is common during recovery: " Over past crises, the duration of the period of rising unemployment averaged nearly five years, with a mean increase in the unemployment rate of seven percentage points, which would bring the U.S. to double digits" The contributions of Reinhart and Rogoff Econbrowser






5. But.... The best approach for supporting the Stimulus, it seems...is to lie!

Here's the truth:
"Neither historical data nor recent international comparison support Reinhart's and Rogoff's claim about the weakness of recoveries after financial crises."
Lott, "At The Brink," p. 113.


a. "A large contraction in output tends to be followed on the average by a large business expansion; a mild contraction, by a mild expansion."
Milton Friedman, "The Monetary Studies of the National Bureau," ch.12, in "The Optimum Quantity of Money and Other Essays."


b. "...since the 1880's, the average annual growth rate of real GDP during financial recoveries from financial crisis recession was 8%, while the growth rate from non-financial crisis recessions was 6.9%."
Bardo and Haubrich, "Deep Recessions, Fast Recoveries, and Financial Crises: Evidence From the American Record," Federal Reserve Bank of Cleveland, June 2012.
Meet The Team


c. "U.S. history provides no support for linking low employment and high unemployment in the current recovery with the financial crisis of 2007–2008."The Financial Crisis and Recovery Why so Slow - September October 2011 - Federal Reserve Bank of Atlanta


d. In January 2009, prior to the Obama Stimulus, the WSJ had surveyed economic forecasters. They predicted an increase of 0.8 % in unemployment by December of 2009. Instead, 4 months after the Stimulus...it had climbed by 2.1 %, while in Canada....up 1 %.
Lott, Op. Cit.


Had Canada instituted a 'stimulus'?
Wanna guess.

 

[PoliticalChic]

6. Keynesianism, the rationale for Progressive economic policies, will never die for the simple reason that it gives politicians a reason, an excuse, to spend other people's money.---



Here is an interesting, if not dispositive, test of Keynesian Theory.
If Keynes is correct,the American economy should have performed well compared with countries that followed others policies.

That is not the case: Canada provides an interesting contrast, as our economies are closely interconnected.


a. Canada is our largest trading partner. Any cutback by American consumers directly affects Canadian-made goods.


b. Here is the difference:the Canadian government had chosen not to introduce any new big government programs, even though revenues had fallen, and the deficit grew.
The US debt as a share of GDP rose by 33 % from 2008 to 2012. Canada's debt rose by just over 13%.
"Moreover, the Canadian government didn’t just cut the growth rate of spending, a favorite trick of U.S. politicians who want to claim the mantle of fiscal conservatism.It also cut absolute spending on many programs in dollar terms."
Canada s Budget Triumph Mercatus

 

[PoliticalChic]

So.....why are Progressives/Liberals so abysmally wrong when it comes to economic policies???

Keynes....that's why.

Keynes vs reality.
Ready?

7. Canadian and US unemployment rates increased in lockstep from August 2008 to February 2009, when Obama's Stimulus was passed. After that, Canada began to substantially outperform the US in job creation, the supposed point of the stimulus.

In the US, unemployment rose to 10.1 % by October 2009, and remained at least at 9.5% for the next 14 months. Canadian unemployment peaked at 7.7 % in July and August of 2009, and has been falling ever since.
Lott, "At The Brink," p. 102-103.



a. When the American unemployment rate in September 2011 was stuck at 9.1 %,Canada's had fallen to 6.3%.
The US unemployment had increased by 1.3 % since Obama became President, while Canadian unemployment had already fallen below its January 2009 level.
Lott, Op. Cit.


Again: Canada didn't throw money into a "stimulus."
American fools put a fool in the Oval Office.


The only error greater than following Barack Obama's lead in economic policy.....

....was voting for the dunce.

 

[PoliticalChic]

3. Now this.....in today's news, a stark perspective on the economic results of the Obama presidency:



"The share of North America in the global high-income population decreased from 54% in 2001 to 46% in 2011,..
.... several countries in Western Europe had higher shares of high-income populations than the U.S. in 2011...


....the U.S. had the unfortunate distinction of slipping backwards as the share of its high-income population decreased from 58% in 2001 to 56% in 2011....

The proportion of Americans who are upper-middle income barely moved from 31% in 2001 to 32% in 2011, and the share that is high income actually fell, as noted, from 58% to 56%...


....The median annual household income in the U.S. fell from $53,646 in 2001 to $50,054 in 2011 (U.S. Census Bureau).....

Unlike in the U.S., Canadian residents progressed from upper-middle income to the high-income standard of living...." Despite Poverty s Plunge Middle-Class Status Remains Out of Reach for Many Pew Research Center



"Not facts, nor data, nor experience, nor rational debate will convince Liberals."


Apologize, Liberals.