patrick.net

Typical extremist BS. Interesting that it is a criticism of Keynesian economic theory, that some economists want to employ to get us out of this mess. But it totally avoids (not even a whisper) about the magnitude of the situation we found ourselves in, starting in late 2008, or why and how we got there. If you can't acknowledge the magnitude of the problem, and can only make a hand waving supply side argument, then it's clear that all you want to do is give a pseudo rationale for those who want to fight "stimulus."

What are you going to do ? Fight stimulus until world war becomes the stimulus, like it did last time ?

The was the same rag that said industry self-policing and deregulation would lower prices and that fraud would be no greater under deregulation than it was under strict oversight.

They had a math model you see, which 'proved' it; just like the astrologer can prove Tuesday will be bad for you using the location of the stars and geometry.

Keynesian economics doesn't work. The stagflation of the 1970's pretty much disproved it.

UI is generally used for consumption and consumption alone does not create jobs. Capital investment does.

Consumption of basic staples is a need, not a want (food, water, shelter, clothing).

We have a want and not a needs based economy. If the economy was based on needs we wouldn't have patrick.net or any other website.

No business counts on those on UI as a key demographic to target. No advertising executive will ever sign off on targeting those without money as a group to advertise to.

The problem with UI isn't so much what it is doing but what it isn't. There is no means test by which it examines exactly how much people have beforehand.

Nearly 3,000 millionaires last year filed and received UI
http://www.theatlantic.com/business/archive/2010/10/millionaires-collecting-unemployment/64021/

Government programs never really ask specifically how well off people really are when they use them (except for TANF). Bill Gates could probably grow out a goatee, put some dirt on his face and walk into a soup kitchen.

Plus we had the baby boom massively flooding into the job market.

Births peaked in 1957:

1952 3,913,000
1953 3,965,000
1954 4,078,000
1955 4,104,000
1956 4,218,000
1957 4,308,000

18-20 years later, they were looking for work.

And finding it . . .

http://research.stlouisfed.org/fred2/series/PAYEMS/

shows jobs increased 20M, from 70M to 90M in the 1970s.

Jobs also increased 20M in the 1980s and 1990s, but that took much more debt leverage to accomplish:

http://research.stlouisfed.org/fred2/graph/?g=1GX

By this measure, we did pretty damn good in the 1970s.

How Keynes enters into this is a mystery. I guess Nixon closing the gold window allowed us to tolerate more inflation, but the picture is complicated since other nations were also competitively inflating with us.

mdovell says

We have a want and not a needs based economy. If the economy was based on needs we wouldn't have patrick.net or any other website.

we have both. It is the easy satisfaction of the needs that gives us the surplus to produce the wants. Haven't you ever played Civ?

Seriously, in our economy food, clothing, and transportation are not the long poles in the tent.

Housing is, but that's due to the economics of land more than the cost of the structure itself (the house itself is a very durable good that, with proper maintenance, depreciates minimally over the decades).

Health care is a major expense, only because we're getting raped by that industry's profit margins.

UI is generally used for consumption and consumption alone does not create jobs. Capital investment does.

This is perhaps the most dogmatically stupid thing I've ever read.

Seriously, your dogma is making you stupid. Find some new ideology.

For one, Capacity utilization is still in recessionary territory:

http://research.stlouisfed.org/fred2/series/TCU

So more fixed capital is not necessarily the train that's going to save us.

Furthermore, the hundreds of billions we spent on UE 2008-now were bottom-up stimulus to the economy. They did more for the working class -- and working class jobs -- than the hundreds of billions of top-down stimulus, though both were needed to keep the rubber on the road.

The key thing you need to wrap your head around is the flows available to the working class. NAFTA, the yuan rate, and the steady flow to oil exporters have pulled trillions out of the J6P economy, 1990 to now.

We used the housing bubble to hide this, 2002-2007, but that play is over now.

J6P is dead man walking.

>He employed supply-side economics to get PRODUCTION up

LOLers

http://research.stlouisfed.org/fred2/graph/?g=1Hn

blue line shows government spending / GDP rising from ~20% of GDP to 22-23% of GDP in the mid 1980s. Supply side my ass.

The red line is annual gov't deficit to GDP -- yeah, cutting taxes does give a boost, but the deficit doubled from ~3% of GDP to 6% of GDP under Raygun.

National debt to GDP shows the full story:

http://research.stlouisfed.org/fred2/graph/?g=1Ho

with it rising from 32% of GDP to 55% in the 1980s.

Supply side economics FTW, LOL.

Here is an excellent rebuttal of Moore:

http://www.tnr.com/blog/jonathan-chait/93942/in-which-i-try-restrain-my-nasty-impulses-limited-success

I have been following Moore for years, and I have met him -- yes, it was awkward -- and I can assure you that this is not just some oddball rhetorical game he's playing. He genuinely has no idea what he's talking about. And I'm sorry to be mean to what seems to be a fairly nice guy, but it does matter that there are completely ignorant people wielding great influence over the policy debate.