Market Currents
Despite the resurgence of Keynesian economics and the popularity of Nobel Prize winner Paul...
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Friday, June 15, 2012, 7:07 PM ETDespite the resurgence of Keynesian economics and the popularity of Nobel Prize winner Paul Krugman, MarketWatch's Howard Gold sees some chinks in his armor. Gold makes the following counter-argument: Much of today’s unemployment is actually structural, the European crisis shows that countries’ long-term debt really does matter and Keynesian economics track record is more hyperbole than substantive reality.
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This news story has 22 comments:
Surely you jest!
Don't call me Shirley!
Seriously,
Krugman is a hack who has only one idea.
Conquer our debt problem with,
PILES OF MORE DEBT!
Yeah, that's the ticket!
Ticket right off the cliff...
what a revealing day
He has NEVER offered a solution to debt...only solutions to austerity and fiscal prudence.
For example: "Upon taking office, Hamburg promised an aggressive effort to enforce the FDA’s stringent manufacturing standards. In 2010, Hamburg’s officials issued 673 warning letters to drugmakers and other companies: a 42 percent increase from 2009. In 2011, the agency issued 1,720 warning letters: a further increase of 156 percent.
The impact of Hamburg’s enforcement actions was swift and dramatic. Of America’s five largest manufacturers of generic injectable drugs—APP, Hospira, Teva, Bedford, and Sandoz—the latter four were effectively forced to simultaneously take significant production off-line in order to deal with FDA warnings. As a result, their production of generic injectables declined by 30 percent, contributing to a massive shortage. “Pharmaceutical companies, despite running available production lines around the clock, are now forced to decide which drugs to continue producing and which to stop producing, and whether to cease production temporarily or permanently,”
http://onforb.es/Ls7Z0J
Repeat that regulatory zeal over countless industries and you have a US unable to efficiently do anything. We just muddle along.
Keynes gave them an excuse to debase money without limit - allowing politicians to buy whatever votes they needed, as needed.
And economists soon learned that if they keep chanting Keynesian Economics the Government will sponsor all kinds of grants and research projects - keeping these economists well paid for decades to come. Who wants to hire a economist that tells them they have to take actions likely to end their political career overnight when they can hire one who sanctions their slightest whims?
Government, with the help of this framework of economics, has gone so far to the extreme that few people consider doing anything without government sponsorship or funding. When you hear someone talking about "something needs to be done" the following words are "by the government". And there are hundreds of talk shows making a living on this chatter.
Where is the person who says, "if you feel something needs to be done then you better get busy."?
ways.
Our government is broke. Its plain and simple. And no one knows what Keynes would write today regarding the situation. He wrote explicitly about temporary government spending to spur growth - and wrote explicity about pulling that spending in and changing fiscal policy going forward once growth was taking in.
Exactly. Governments don't follow Keynes anyway. They just continually spend and create more debt. If they actually followed Keynes we would not have the mess we have today. Krugman is not a Keynesian, but rather is just an irresponsible propoganda pundit who always advocates more spending and more debt yet never has any recommendations on how or when to reduce spending and reduce debt.
I think Government made every effort to do everything it could consistent with Keynesian Economics and Hayek's "The Road to Serfdom" with the original crisis hit.
And the people responded by ousting a majority of those politicians, creating a deadlocked government that is incapable of doing anything -- which is probably for the best considering.
Unfortunately, until and unless there is an effort to unwind the Government we have no choice but to fall out of our current status in the world followed by a general collapse of society.
In short, the Euro zone crisis has many causes but it's a bit rich to lay the blame on Keynes.
Polticians do not get re-elected on "Austerity"
Because that means those on the "Dole"
Would get cut back or cut off.
Legs up not hands out for us
Job creation from tax reduction for us
Corporate tax should be reduced to the lowest in the world
to enhance "Re-shoring" 14% sounds about right to juice everything