That would put people back to work and increase demand. Demand would cause more hiring. that is against the Republican plans, so it will not be allowed to happen.
Out of curiosity, why would Republicans be against increased demand and putting people back to work? Presumably increased demand would mean increased business for the companies with said increased demand, which would mean increased profits. Why would anyone be against such a plan, assuming it actually did what you say it would (obviously it wouldn’t, but for the sake of argument, assume it would)??
-XT
I missed the part where you prove that “obviously” it wouldn’t.
My apologies. It’s obvious to me why it wouldn’t work, but I actually didn’t write what I meant there. What I meant to say is something along the lines of ‘obviously, Evil Republicans wouldn’t think it would work, but for the sake of argument assume it would and explain why they would be against it’.
Better?
-XT
For one thing, “labor discipline”. In other words, when the job situation is bad workers put up with lower pay and worse treatment. For another, they want to make Obama’s Administration as much of a disaster as possible. Third, desperate, panicked and despairing people are easier to manipulate. And fourth, it helps lower government revenues which helps with their general plan to make it crash and burn.
The only one of those I’m buying is the (to paraphrase) ‘make the Democrats look back’ or ‘don’t want the Democrats to get the credit’ reasons, but even there I’m frankly skeptical. The answer, IMHO, is that like me they don’t believe it would have the joyful effect that many in this thread seem to think it will. Simply hiring a bunch of people isn’t going to spur demand and make the recession go away…if it was just a matter of hiring people, and this would magically spur demand then companies would be falling all over themselves to do that, since spurring demand means they sell more stuff. Unless you are under the impression that companies don’t like to sell stuff and make profits it doesn’t even make any logical sense…unless, as is the case here, the premise is flawed to begin with.
Even if you and most of the others in this thread are right, and somehow simply hiring people and putting them back to work will put the cart before the horse and spur demand, if companies don’t THINK this will be what happens it will have the exact same effect…i.e. they will resist your wonderful and easy solution to the problem because they don’t think it will work.
No evil required.
-XT
Well, you’ve made it clear that like Obama you are determined to see the Republicans as far nicer and more ethical people than they clearly are.
Only if they were far less short sighted and more capable of altruism and spontaneous cooperation than they are. And it isn’t “magic” to think that people with a job and wages from it are going to buy more. Henry Ford famously paid his workers well so they could buy the cars they were making; modern corporations are far too short sighted and greedy to imitate him.
[QUOTE=Der Trihs]
Well, you’ve made it clear that like Obama you are determined to see the Republicans as far nicer and more ethical people than they clearly are.
[/QUOTE]
Oh, I don’t think either Obama or I am laboring under the delusion that Republicans are nice. I don’t even discount that they can be/have been/are being stupid…they are all of that.
Let me ask this in a different way. If simply hiring all of the people currently unemployed is a sure fire way to spur demand, why doesn’t anyone do it? Oh, we all know that Americans are stupid and greedy, so let’s leave them out of this. Let’s take, oh, say France. They have had unemployment problems for quite a while. Why haven’t they simply hired (or forced their corporations to hire) a large percentage of their unemployed to spur demand and make themselves the economic superpower they feel is their rightful place in the universe? You can’t tell me that it’s the Evil Republicans (or the French equivalent :p) preventing this seemingly simple and fools proof method? Are you? Why hasn’t any other country (with the exception of many communist countries where it didn’t work out so well) tried this? It’s seemingly simple. In a recession? Unemployment high? Well, just hire everyone and this will magically spur demand and set you on the road to recovery and baby seals!
So…why hasn’t anyone done this?
-XT
Being unfamiliar with the details of their situation I can’t do more than guess.
Oceans of duh. If only one or two of them did it, it would be a noble but futile, and possibly suicidal, gesture. Nobility and self-sacrfice are not the qualities that lead to the top.
Besides, it is much more efficient to do it the obvious way, put money in the hands of the consumers, and they will consume, thus creating demand, thus creating jobs to meet that demand. You can bet your booty that they will try to have it both ways, they will try to hire more workers but with as little pesky intervention by unions and government as possible.
But one or two of them unilaterally making such a move? Foolish, futile, and self-destructive.
I see liberals have latched onto a new strategy - it’s consumption that creates growth, and poor people consume all the money they’re given, so the way to grow an economy is to tax money from the rich and give it to the poor. Throw in a multiplier or two, and you can even claim it’s free!
I predict this will be the left’s version of the Laffer Curve - taking a concept that has a very narrow application and turning it into a universal justification for enabling all the policies they wanted to enable in the first place.
You seem to be suggesting that only if we had your crystalline objectivity and non-partisan viewpoint, we would be falling all over ourselves to agree with you.
Keynes is new? A wild eyed youth bursting upon the scene?
In a consumer economy? Hugh Betcha it does, its the spine, the vessel, and the essence. Many of us progressives hope to evolve past such wasteful extravagance, to our eyes a consume and discard economy is not much of an improvement over slash and burn agriculture. But, yes, the engine of Americas economy is fueled by consumption. What else could it be?
(emphasis added)
No doubt, they consume all that they get. They might well wish otherwise.
If we were truly that simplistic and shallow, you would be winning.
Do you mean the Laughable Curve? Dumber than a retarded hammer? So, is that by way of admitting that the Laffer Curve is deep dish crapola?
Sam, if you’re going to claim the heft of academic economics and beat your opponents over the head with it, then by rights you have to admit there is no established orthodoxy based on objective fact. Economic views similar to those of Keynes and Krugman are totally mainstream, they are not wild-eyed radicals.
You have your views, and welcome to them. But you cannot fairly claim that yours are supported by the science of economics, and mine are refuted without admitting that many economists of equal credential to those you cite disagree with you. And them.
And if and when (if it hasn’t already) those Keynesian/Krugman views become the dominant mainstream, whatcha gonna do then, beaver boy?
[QUOTE=elucidator]
Oceans of duh. If only one or two of them did it, it would be a noble but futile, and possibly suicidal, gesture. Nobility and self-sacrfice are not the qualities that lead to the top.
[/QUOTE]
If only one or two countries did this, it would by futile?? So…everyone has to do this, and then it would work?
So…what the government has to do is to take all the money from the rich, and put it in the hands of the poor and middle class, then force business to hire people? And all countries have to do this or it will be futile and suicidal? Is that a good synopsis? I ask because I want to make sure we are on the same wavelength here, at least wrt what you are saying.
Does this strike you as something that’s been proposed before somewhere? It seems familiar but, well, I just can’t place it. Right on the tip of my shoe, but I keep having the thought scraped off, as it were.
-XT
Hoo, boy, early onset Budweiser’s. For whatever reason, where you wrote “country” I read “company”, and read it the same way several times. So I’m firing upon a position not currently occupied. My bad.
However, if we had been talking about “companies”, I would have been totally right. Just want that noted for the record.
No worries. That’s why I thought it best to ask. Yes, if only a few companies hired a bunch of excess people that they had no need to in an effort to spur demand, then it would certainly be both futile and most likely suicidal in the current economic climate. I agree.
-XT
As far as countries go, you may not be on as solid a ground as you think. I, Claudius, post #88 requests your attention.
We’ve got to the point when, confronted by facts and evidence, you refuse to engage other people in the thread and just throw insults instead. Can you please give us an answer to this post please :
http://boards.straightdope.com/sdmb/showpost.php?p=14104682&postcount=98
You were originally saying in this thread that people on your side of the argument were claiming that interest rates would only increase after the economy recovered. However there’s a huge amount of documented evidence that this is not the case. The usual suspects like the Wall Street journal editorial board and similar media outlets, all the efficient market fuckwit economists who supported the policies that led to the 2008 meltdown, and yourself were all warning us a year or two ago of the dangers of government borrowing crowding out private investment and pushing up interest rates. Clearly this hasn’t happened. Will you now admit that the various people advocating the crowding out theory were wrong?
Why don’t you go back and read what I actually said? I said that crowding out would happen if the stimulus money didn’t go to idle resources. I specifically said that I wasn’t talking about money - I was talking about diverting productive resources like engineers and architects from projects they were already working on to government projects of lesser value. Hell, I even posted several real-world examples of this happening.
As for what the Wall Street Journal says… I’m not their apologist or their gatekeeper. Hell, I don’t even read the paper, so I have no idea what they’re saying. Among the economists I read, none of them were predicting a scenario of declining growth and rising interest rates. What some of them were saying (and still are) is that if you grow the monetary base but velocity falls, you won’t see inflation - because there’s no expansion of the money supply. But the problem you then run into is that if the growth does start and velocity picks up, you’re setting the stage for inflation at that point. So when the economy heats up, inflation happens, interest rates go up, and that chokes off the recovery. You either wind up with stagflation, or a long period of low growth and moderate interest rates and moderate inflation.
Hell, even Bernanke admits this possibility. His answer is to unwind the injection of capital from QE1 and QE2 by selling off the treasuries the Fed purchased, I believe. Of course, that presupposes that there are enough buyers for it all.
This is all an untested assertion of course, since the economy has not ‘heated up’. Of course, it was YOUR side that was predicting a robust recovery, due in part to the magic of stimulus. I was the one on this board predicting a ‘lost decade’ of perpetual low growth. Since we’re playing the recrimination/absolution game, will you now admit that you were wrong about that?
I was saying backin November 2008 that we should have raised taxes during the recession. When taxes have been much, much too low for a decade, it doesn’t seem to violate Keynesianism to raise them enough to help support short-term stimulus (because effective stimulus is* redistributive*) and get us on the path to long-term fiscal balance.
As far as debt is concerned, we a) in theory, & given long-term revenue increases, could get away with a peak of 2x-3x annual GDP, b) don’t really want to test that, & c) don’t actually need that much. But since debt apparently is seen as a such a problem, I’d just as soon progressivize the net effect of the tax code & pay for public works & welfare with taxes.
All this of course runs into the problem that somehow the flat tax is now mainstream thinking.
And the bigger problem that tv nets like ABC put pols on who use the word “tax” like it means, “punish and abuse violently without cause nor justice,” & let that pass unchallenged–every time. A democracy afraid or unwilling to tax itself is incompetent & will be mismanaged for a long long time.
[QUOTE=elucidator]
As far as countries go, you may not be on as solid a ground as you think. I, Claudius, post #88 requests your attention.
[/QUOTE]
According to this, Australia’s stimulus was $26 billion (‘massive’ wrt Australia I suppose…no disrespect to our Aussie 'dopers).
Sort of begs the question…why was our stimulus in the same year (something along the lines of $780+ billion) not effective then if this theory is valid? It hasn’t seemed to spur demand in any reasonable way or spurred businesses to hire back large percentages of the work force the laid off…we are still at over 9% unemployment, after all.
I know that the standard fall back line is that the stimulus wasn’t big enough…to me that’s like saying that Communism would have worked, if not for those pesky kids and their damned dog interfering, but I realize that the point is debatable. But pointing at how this supposedly worked in Australia (and I honestly don’t know enough about the Australian economy or how this did or didn’t impact problems there) begs the question as to why we could spend close to 2 times and order of magnitude more money and it not work here…and how much it WOULD have taken to make it work. And how we would have paid for that if this didn’t magically spur demand and incite corporations to rehire all of the folks they laid off. Considering that a lot of the folks laid off in this downturn were either in the housing construction industries or related industries I’m not seeing how this would have worked, but admittedly I’m no expert on economics, nor do I play one on the SD.
Just wanted to respond to your request to check out the post…I’ve been out of town a lot lately so wanted to try and squeeze it in between flight.
-XT