Reason

Reason Staffers Get Raspberry for Preferring 'The Presidential Candidate Who Would Destroy the Economy'

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The non-nuts

Bloomberg View columnist Josh Barro declares it "unfortunate" that most Reason staffers plan on voting for Libertarian Party presidential nominee Gary Johnson, as revealed in our quadrennial vote-disclosure exercise (an exercise, I might add, that Bloomberg View has declined to emulate). Why is the pro-GaJo sentiment unfortunate?

[B]ecause Johnson has nutty economic policy views and would do tremendous damage to the global economy were he to somehow become president.

Johnson advocates severe near-term fiscal and monetary policy austerity. When we talked at (or rather, outside of) the Republican National Convention, he told me he would cut Medicare spending by 43 percent in the short term. He repeatedly insists that "we are in the midst of a monetary collapse" and says he favors returning the United States to a (deflationary) metallic currency standard. He says he would have opposed TARP and allowed systemically important banks to fail.

In other words, if Johnson had been president in 2008, he would have allowed the U.S. financial system to collapse and the country to fall into depression. And if he became president now, he would do his best to strangle the tepid recovery we are enjoying and turn it into another severe recession.

Non-nut II

As I said two years ago when Andrew Sullivan made a very similar argument about the madness of TARP-opposing libertarians (who "drive us nuts with their utter disengagement with…political reality"), just about every worst-case, no-TARP scenario floated by then-President George W. Bush when he first tried to frighten Americans into line has actually come to pass. Similarly (and as predicted by many cuckoo-bananas libertarians), just about every worst-case, no-stimulus scenario floated by the Obama administration has, too, come to pass. The economy (or in Barro's memorable phrasing, "the tepid recovery we are enjoying") has relentlessly underperformed the projections made by economic interventionists for four years running.

Against that backdrop of failure, the only way to get behind the bailouts is to assert that without them "the U.S. financial system" would "collapse" and the country would "fall into depression." Like all good unknowables, this is both eternally useful and heavily contested (see David Stockman for one of the more detailed cases against). What makes Barro's deployment of the "collapse" hypothesis particularly fun here is that it comes in the service of busting Gary Johnson for hyperbole in talking monetary collapse.

I for one am allergic to hyperbole in both directions, though it's always more irritating when wielded in the service of power. In any event, the underlying question going forward hinges on whether you think cutting federal spending by 43 percent in one year (balancing the budget, in other words) would lead to "another severe recession" and be worse than the fiscal cliff currently scheduled for Jan. 1.

I am in the camp that believes cutting government spending has a positive, not negative, impact on the economy, as was the case in post-war America, 1980s New Zealand, and 1990s Canada. And that if we don't change the trajectory of government expenditure, particularly with trillions in entitlement and pension promises coming due, there won't be much room left over for other federal services, let alone a robust private economy.

Is that "nutty"? Probably. But enough about me–Josh Barro, show us your vote!

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  1. Corporatist whore panics at the notion that the state might someday stop shoveling money his way…. Film at 11.

  2. In other words, if Johnson had been president in 2008, he would have allowed the U.S. financial system to collapse and the country to fall into depression. And if he became president now, he would do his best to strangle the tepid recovery we are enjoying and turn it into another severe recession.

    Well, thankfully with the people we put in office, the depression and servere recession was avoided.

    1. And at such a low, low cost to our national debt!

    2. “In other, other words, thank God George W. Bush was president in 2008″, says Josh Barro.

    3. No shit. The gall to act as if that’s not what happened.

    4. Unfortunately, we didn’t spend enough on the stimulus so the recession was not entirely avoided.

      Why don’t we just spend $100 quadrillion on stimulus and get it over with once and for all?

  3. Excellent point about the hypocrisy on hyperbole.

    Somehow if you say the US faces a fiscal collapse if we don’t do something about the budget deficit, you’re a crazy lunatic.

    But it’s a-ok to say we could have faced a total economic collapse if we hadn’t bailed out the banks. In fact, anyone who denies this is a crazy lunatic.

    1. But it’s a-ok to say we could have faced a total economic collapse if we hadn’t bailed out the banks. In fact, anyone who denies this is a crazy lunatic.

      I used to think people looked at me like some kind of lunatic until I started asking people if they thought the next common US currency might be based on rounds of .22lr. Now I get a look that leaves the old one behind!

      1. An ammunition based economy was one of the elements of the Metro 2033 video game. I never read the novel, so I don’t know if it was in there too.

        1. I’m putting all my savings into bottle caps.

          1. As a fellow homebrewer without a kegging system, you and I will be the next Carnegie and Rockafeller.

        2. I still need to finish that game. Crap, I still need to finish Fallout 3 as well.

        3. An ammunition based economy was one of the elements of the Metro 2033 video game. I never read the novel, so I don’t know if it was in there too.

          Hmm. I’ll have to look up the book.

          My thinking is that if things go badly enough and the dollar collapses, commerce collapses, the grid collapses, government services collapse. Barter is the order of the day.
          Without police, people are looking to their own protection. Without markets, people will be shooting every squirrel in sight. How many rounds do you think most people have for a gun? 100 maybe? (One neighbor told me he has -7- rounds for his .45ACP.) I imagine it will go fast. And the .22lr is a very common caliber gun.

          1. A guy who survived Sarajevo said the best trading items were tobacco and coffee. I’d throw in some liquor into that mix as well.

            1. Well on the internet so I’ll add a guy who Claims to have survived Sarajevo.

    2. The people who are warning about the self destruction of the welfare state are the same people who saw the recession coming.

      The people who have an interest in the existence of the welfare state and were rolling on the “good times” before the recession refused to acknowledge that the recession could happen.

  4. “He says he would have opposed TARP and allowed systemically important banks to fail.

    In other words, if Johnson had been president in 2008, he would have allowed the U.S. financial system to collapse and the country to fall into depression.”

    In addition to the obvious freshman year logic fail, what evidence does Barro have to suggest that another Lehman or Bear winking out of existence would have been worse than what we’ve had over the last four years?

    1. freshman year

      That’s first-year you dirty sexist.

      1. Yeah, let’s be respectful of the coeds.

      2. Sexist language like that is why people don’t take libertarians seriously!

  5. It’s not really an unknowable. The problem is you guys advocate the exact same fiscal policies no matter if we’re on the brink of a depression or in a boom. Despite your moral fixation on government spending, cutting it in the midst of the Bush Great Recession would have the same effect as reducing consumer demand by the same amount. Johnson would indeed have forced the country to suffer through a much, much worse economy for much longer, not because he bases his ideas on practicality or considers the good of the people, but because he, like you guys, are absolutely singularly fixated on your moral obsession with government being evil. This is not the same economic environment as postwar US. That you think the same prescription is necessary for two completely opposite situations means you’re dogmatists, and your ideas are dangerous.

    1. Fuck off, sockpuppet.

      1. I was kind of hoping this would be the only reply. Other folks fed the troll, unfortunately.

      2. The fun of Tony is trying to guess who he actually is. I think it’s Gillespie.

        1. I like your ideas. But I think it’s Cavanaugh. Not sarcastic enough for Gillespie.

          1. You fools. They have a dedicated T o n y computer set up at the Reason offices and they takes turns acting as tony for the day.

            Today’s tony is clearly Shika

            1. Today’s tony is clearly Shika

              That’s always a risk when you go to the matinee.

            2. I don’t think Shika could pull it off. She obviously hates the archetype Tony represents with a passion.

              Maybe they still have Weigel on the payroll to liven up the comments section.

        2. I’ve been trying to figure this out for the longest time too. I’m also leaning Gillespie, probably without The Jacket.

      3. The problem is you guys advocate the exact same fiscal policies no matter if we’re on the brink of a depression or in a boom.
        Fuck off, sockpuppet.

        You know those days so hot the temperate inside the office is 85F and the AC never shuts off? T_o_n_y reminds me of the people at work who turn the thermostat down from 75F to 45F.

        That you think the same prescription is necessary for two completely opposite situations means you’re dogmatists, and your ideas are dangerous.

        Chronic hyperglycemia and chronic hypoglycemia are two opposite states. The dietary prescription for both is the same, and it has been demonstrated time and again to work.
        The biggest secret to flying modern passenger jet aircraft? Don’t fight the plane. A pilot not trained for it will overcompensate (futzing with a self-regulating system) and send it into a terrifying roller coaster ride. Let go of the yoke and it will return to flying straight and level.

        1. “Chronic hyperglycemia and chronic hypoglycemia are two opposite states. The dietary prescription for both is the same, and it has been demonstrated time and again to work.”

          Awesome. I am stealing this analogy for future use.

      4. What SugarFree said.

    2. That you think the same prescription is necessary for two completely opposite situations means you’re dogmatists, and your ideas are dangerous.

      Your stupid is starting to burn.

      /Johnson would indeed have forced the country to suffer through a much, much worse economy for much longer

      Shut the fuck up, you god damn idiot.

      1. Yes, because all that capital equipment sold at fire-sales by the bankrupt firms to companies or individuals who were operating going concerns would have done nothing to boost the economy.

        Tony, thanks again for filling my life with laughter. The blistering illogic you dump here – for reasons that baffle me – crack me up.

        Stay envious my friend.

    3. Despite your moral fixation on government spending, cutting it in the midst of the Bush Great Recession would have the same effect as reducing consumer demand by the same amount.

      Which is irrelevant, because when the government is spending 8-12% of its GDP in deficits, ANY pullback of that deficit spending is going to result in a drop in GDP. But it’s necessary, because those debts will have to either be paid back or defaulted on in the future–and right now, we’re going on the same path as Japan, whose total revenues will now only cover their social security obligations and interest on their debt (despite the fact that they take in far more revenue as a percentage of GDP than we do).

      And for all your bloo-bloo-blooing about morality, I’d say it’s just as immoral to mortage the earnings of future generations just to keep current political figures in office.

      This is not the same economic environment as postwar US.

      Which means that going back to postwar US tax rates isn’t automatically going to equate to massive economic growth, either.

      That you think the same prescription is necessary for two completely opposite situations means you’re dogmatists, and your ideas are dangerous.

      Since you can’t do basic math, this bit of stupidity can be taken for what it’s worth.

      1. I’d say it’s just as immoral to mortage the earnings of future generations just to keep current political figures in office.

        Oh, so you’re for tax hikes, so that the current generation can start paying the debt off? Or is it you who can’t do basic math?

        The point is we’ve tried versions of both schools of thought in similar situations. You guys were proved wrong and the Keynesians were proved right, and the only thing sustaining your guys’ dogmatism (cut government in every situation no matter what!) is the unfortunate ability of the human mind to deny evidence and persist in utter delusion.

        1. The point is we’ve tried versions of both schools of thought in similar situations. You guys were proved wrong and the Keynesians were proved right, and the only thing sustaining your guys’ dogmatism (cut government in every situation no matter what!) is the unfortunate ability of the human mind to deny evidence and persist in utter delusion.

          LMAO!

          Oh my god!

          It’s like the seventies never happened! OR the eighties, nineties, the oughts!

        2. When were the Keynesians proved right? Let me guess — the great depression? you do realize that the great depression resulted in unemployment that was still near 20% in 1939, 10 years after the crash, right? And that it experienced a double dip — AFTER the enaction of most of FDR’s keynesian policies, right? You do realize that the Great Depression lasted over a decade and was horrible, notwithstanding all the Keynesian policies that were enacted, right? Oh, and the Great Depression was likely caused by Keynesian-style manipulation of the market.

          The fact is, recessions and depressions were shorter in duration and less frequent prior to Keynesianism and the creation of the Federal Reserve. Look it up.

          1. Jesus almost everything you wrote is the opposite of reality. You look it up.

            1. Okay, here is a link to the double dip and unemployment (it even has key FDR programs marked — the double dip happened right after the court packing and second New Deal:

              http://jessefelder.posterous.c…..depression

              You can search a list of depressions/recessions for yourself, although that issue is trickier. Because of the Federal Reserve’s inflation of the dollar and the definition of recession/depression being depending on unadjusted GDP, we can inflate ourselves out of the definition of a recession/depression. For example, we are no longer in a formal recession because GDP is growing. However, it’s being outpaced by inflation, so we are all getting poorer (collectively) by the day. But, the Federal Reserve and Keynesian policies have been utter failures at their stated goals.

              1. He’s just going to blame Hoover, like Barry blames Bush. History does repeat.

            2. “Jesus almost everything you wrote is the opposite of reality. You look it up.”

              Well, you should take your own advice here:
              “the only thing sustaining your guys’ dogmatism is the unfortunate ability of the human mind to deny evidence and persist in utter delusion.”

              YOUR understanding of the great depression and FDR is flawed. Despite the long-standing narrative that FDR got us out of the great depression, it is now becoming obvious that keynesian policies were to blame.

          2. The Obama stimulus was an enormous success–can’t you tell?

            See that fiscal cliff looming in front of us on January 1?

            In Tonyworld, that apparently has nothing to do with spending.

            Always remember that–in Tonyword–our fiscal problems have nothing to do with spending.

            Even Keynes and Krugman say that in the long term we’re all dead. Not Tony. To Tony, there is no downside to spending. No downside to raising taxes either. He lives in an intellectual vacuum consisting of himself and his misguided preconceptions.

            1. Of course there is a downside to too much spending or too much taxing, depending on what the macroeconomic environment is. Bush should have been balancing the budget for the most part instead of engaging in massive deficit spending. The problem is you don’t care what that environment is, your prescriptions are always the same, and they’re not based on macroeconomic math, but a quasi-religious antigovernment moral fixation.

              1. Hilarious. I’d love to hear your definition of “too much spending”. Extra credit if you can avoid equating tax cuts with government spending.

                1. I can think of a good example of too much spending. How about a multitrillion-dollar war based on lies?

                  1. I can think of a good example of too much spending. How about a multitrillion-dollar war based on lies?

                    If those same multi-trillions had been spent on welfare programs, healthcare and education, whould it still be too much spending?

              2. Re: Tony,

                Of course there is a downside to too much spending or too much taxing, depending on what the macroeconomic environment is.

                You don’t seem to understand it yet, Tony – you CAN’T know what is “too much” or “too little” spending or taxing because people cannot know the preferences of everybody else.

                And don’t bring up elections into the mix again – elections mean crap. Things only get real when people have to plunk down money. Talk (and voting) is cheap.

                Bush should have been balancing the budget for the most part instead of engaging in massive deficit spending.

                Totally agree!!!

                The problem is you don’t care what that environment is,

                Totally correct!! *I* don’t care, and neither do the laws of economics. That is what you want to ignore.

                your prescriptions are always the same, and they’re not based on macroeconomic math, but a quasi-religious antigovernment moral fixation.

                As if there was nothing moralistic about Keynesian economics.

                *cough* Perfect markets! *cough*

                By the way, there’s a distinction between being anti-government, and economic analysis. You can have totally free markets in the presence of government if government was just this club for mediocre men and women that gathered to talk about their pets during a session of bridge. Kind of like the Golgafrinchan’s third ark.

          3. If it wasn’t for FDR, unemployment would have been 900%!

        3. Oh, so you’re for tax hikes, so that the current generation can start paying the debt off? Or is it you who can’t do basic math?

          I’m for spending cuts, so the current generation can start paying the debt off. Just six years ago, federal spending was a mere $2.7 trillion. It was less than that during the Clinton years. The lack of ability to basic math is yours.

          The point is we’ve tried versions of both schools of thought in similar situations.

          Yep, and after the 1920-21 recession, the economy came roaring back.

          You guys were proved wrong and the Keynesians were proved right

          When in the last 50 years has spending ever been cut in flush times?

          1. and less taxes means more money to be spent by the consumer. Why I could afford a better car, a bigger home, donate more to charity, spend more on my child’s education, go on a better vacation, save more, etc etc etc. Now there is some real stimulus.

        4. You guys were proved wrong and the Keynesians were proved right

          1920, the 1970s, and Japan all say hi. And our current U6.

    4. “cutting it in the midst of the Bush Great Recession would have the same effect as reducing consumer demand by the same amount.”

      Wrong. This assumes that if the Government didn’t spend the money that it takes from us (or borrows), then no one would. That is a fallacy for obvious reasons. If the government didn’t take your money, you’d spend it (or you’d save it in the form of a bank account or investments, which would then be spent by the bank or investee on capital). If the government borrowed/printed the money, then that was either taken from you in the form of inflation (making no difference in real aggregate demand) or taken from your children/grandchildren for your benefit — or both.

      1. The brink of a great depression is not the time to count on consumer confidence. The whole point of countercyclical government spending is to prop up economic demand when consumers are pulling back, either because they don’t have the money to spend or they are not willing to spend the money they have.

        Besides, tax cuts were a large portion of the stimulus, justified precisely by your theory. They’ve also proved to be among the least efficient stimulative measures.

        1. WHO IS COUNTING ON CONSUMER CONFIDENCE?! That’s the problem with you Keynesians. You can’t see any way that money is spent unless it’s painfully obvious. Money that is saved IS SPENT! Unless you stuff it in your mattress (which is ridiculous), you either deposit your money in a bank or invest it in something (like stocks or 401k, or whatever). That money is then lent by the bank to someone as capital for somethng (like a business startup or capital investments in an existing business) or used by an investee for the same thing. SAVINGS IS CAPITAL! CAPITAL CREATES EFFICIENCY! EFFICIENCY CREATES A BETTER LIFE FOR EVERYONE! AND, capital expenditure adds to aggregated demand because someone has to build that equipment/business supplies in order for it to be bought. We have completely lost balance between capital investment and retail demand becuase we constantly push retail demand rather than encouraging the proper balance between savings (capital investment) and retail spending.

          1. You’re steaming your underpants arguing with a troll.

          2. So investment chugs along no matter the conditions? Or does that freeze up too in a recession? Keyenes said that saving was not the problem, but excessive saving, i.e., saving beyond any planned investment. It encourages recession and recessions disincentivize investment.

            1. You heard it right here people! Stop saving and invest in that brand new big-screen TV you’ve always wanted! Do it for your country!

              1. Why is Tony so sour today? Hurricane Sandy is about to fuck up the Northeast. Stimulus baby!

                1. Hurricane Sandy Vagina!

            2. Re: Tony,

              Keyenes said that saving was not the problem, but excessive saving, i.e., saving beyond any planned investment.

              And you’re clearly oblivious to the absurdity of what you just said.

              Use your head: Would you know you’re saving beyond planned investments? What kind of investments do you have in your head that would make you put just the right money onto savings lest you violate a Keynesian cardinal rule? Or would you simply save what you can afford to save and from there evaluate potential investments? Keynesians are totally OBLIVIOUS to opportunity costs and the role that TIME plays in choice.

              You simply do not understand, Tony, that Keynesians are NOT economists. They do NOT understand economies, opportunity costs, capital or entrepreneurship. You’re hitching your wagon to the wrong mule.

              1. I think we need to mix it up some. Tony is too easy. Where’s our favorite economic authoritarian, Draco?

              2. Seems like the way you’d know you saved beyond planned investment is that interest rates would plummet to almost nothing, because no one would be willing to pay to borrow the money. Of course,*with* Tony’s prescription, we’ve got the absolute worst of both worlds, with no saving and interest rates near zero.

                BTW, does Tony not even know how to spell the name of the guy he’s fellating? There’s a term for that. If “brain-dead whore” is a term.

            3. Keyenes said that saving was not the problem, but excessive saving, i.e., saving beyond any planned investment. It encourages recession and recessions disincentivize investment.

              Which is bullshit, much like everything else you spew, because paying down debt is considered by the government to be “saving.”

              That’s the problem that your stupid little jughead Obama never figured out. When a society is over-leveraged, it’s completely rational for people to pull back their spending and pay down the fucking debt they’ve accumulated. All that “savings” isn’t going into some personal savings account–especially when interest on savings accounts is less than 1% thanks to Bernanke’s ZIRP–it’s going to pay back all that debt, you moron.

              And adding more debt to an over-leveraged society is the equivalent of giving an alcholic the keys to a booze warehouse. Again, just because you keep ignoring Japan doesn’t mean that’s not where we are headed with the policies you support.

          3. It’s a fucking sockpuppet.

        2. Re: Tony,

          The brink of a great depression is not the time to count on consumer confidence.

          Neither is it a time to test new Keynesian poppycock.

          The whole point of countercyclical government spending is to prop up economic demand when consumers are pulling back,

          Demand =/= economic growth.

          First, government does not produce anything, which means it has nothing to trade with to spur “demand”. It has to take it from somewhere before it can trade it.

          Second, consumer demand is not what drives the economy, it is production. And NO, demand is not like a locomotive pulling the cars along; it is SUPPLY (production) which spurs its own demand, not the other way around. And for production you need CAPITAL – savings – not consumer spending

          1. Evidence that supply creates its own demand? This theory relies on the requirement that rational businesspeople will never hoard money–a hypothesis disproved by experience both current and past.

            Government engaging in intelligent countercyclical action is not reducing productive activity from somewhere else; it is using debt to create productive activity where hoarding or other nonproductive activity was happening.

            1. Government engaging in intelligent countercyclical action…

              Right there is where your theory dies.

            2. You keep talking in vague generalizations, and never offer any specific cases. Then you use your own stupid crap as evidence to come to a vague, unsupportable conclusion. I guess you’re at least consistent.

            3. Re: Tony,

              Evidence that supply creates its own demand?

              I just gave you one – the Altair 8800, which started the home computer (and the PC) industry. Before home computers, geeks and hobbyists were not going around, cash in hand, looking for someone to build them a computer.

              This theory relies on the requirement that rational businesspeople will never hoard [sic] money

              What the FUCK are you talking about?

              Government engaging in intelligent countercyclical action is not reducing productive activity from somewhere else

              Of course it is, nitwit – what do you think taxes DO?

              it is using debt to create productive activity where hoarding or other nonproductive activity was happening.

              This is just a bullshit excuse. Keynesians, obviously government and you, assume people are stingy to justify taxing and spending. But just as easily could use any other excuse, like an invasion from Mars, a la Krugman.

            4. Do you own an iPhone?

              Because Steve Jobs will tell you that supply can certainly make its own demand.

        3. Consumer spending does not effect an increase in productivity, and therefore cannot cause economic growth. Business spending, on the other hand, is conducted for the express purpose of increasing productivity.

          To put it another way, the economy grows when people can make more products with the same or fewer resources. Gov’t policy that encourages consumption-focused spending results in resources being diverted from productive uses to non-productive uses. You’ll not get serious economic growth incentivizing people to buy another tv rather than save and invest in a tv factory.

          1. The problem with the Federal Reserve is that it encourages both consumption and investment spending, by making credit artificially cheap. Freer credit cannot magically increase the amount of resources available, so some part of the economy has to “pay” (by recieving a lower share of available resources) for the diversion of resources into consumption and investment simultaneously. Usually, that area is capital maintenance.

    5. Re: Tony,

      The problem is you guys advocate the exact same fiscal policies no matter if we’re on the brink of a depression or in a boom.

      Same way we would advocate for obeying the law of gravitational pull no matter if you were flying with bedsheet wings or dropping with a parachute.

      cutting it [the spending, not something else] in the midst of the Bush Great Recession would have the same effect as reducing consumer demand by the same amount.

      Thus spake the economics ignoramus.

      Demand =/= economic growth. There’s demand BECAUSE there’s economic growth and production, not the other way around. When MITS released the Altair 8800, every electronics geek around wanted to buy one, but it wasn’t like the geeks were searching for someone to build computers, cash in hand, like a man searches for a dog, leash on hand.

      You’re extremely, EXTREMELY naive about economics, Tony. Go back to your embroidery and leave the boring conversation to us, the men.

    6. The problem is you guys advocate the exact same fiscal policies individual rights no matter if we’re on the brink of a depression war or in a boom peacetime..

      See how that works, Tony? Fuck you and your consequentialism.

      1. No, fuck you and your dogmatism. What does fiscal policy have to do with individual rights?

        1. No, fuck you and your mathematical ignorance.

        2. We either have the right to the fruits of our labor or we do not. You obviously feel we do not.

          1. I feel you are entitled to the fruits of your labor, including such fruits as are paid for collectively via taxation and government spending.

            1. That really means I’m NOT entitled to the fruits of my labor, since the government can take some and give it to someone else anytime it wants.

          2. But of course that’s the moral argument I was talking about that is a completely separate discussion from macroeconomic policy.

            1. It’s not separate when your “macroeconomic policy” involves violating moral rules.

        3. What about the individual right to produce something without being at a competitive disadvantage due to shit the government is doing?

          1. Who says people have that right? You have a right to engage in commerce, but not have the environment fitted exactly to all your desires. Government activity is part of that environment. Government building a highway is “picking winners and losers,” disadvantaging contractors who don’t win a contract, for example.

            Just think of government as a buyer in the marketplace–a buyer on behalf of the people at large. Everything government does affects the market, but to assume that there is some pristine, pure, perfect market to be achieved if only government would stop doing the job of governing is really very silly.

            1. Re: Tony,

              Who says people have that right?

              You’re right – people don’t have a right to an environment with no competition. What they do is have the right to their property while government doesn’t.

              Government building a highway is “picking winners and losers,” disadvantaging contractors who don’t win a contract, for example.

              No – government that builds a highway is thieving resources from people to give them to a well-connected contractor.

              Just think of government as a buyer in the marketplace

              Sure, but that’s not saying anything – thieves are buyers, too.

              You STILL fail to understand the real fact that government produces nothing, therefore it has NOTHING to trade (i.e. to buy with.) It can only TAKE production from someone else, like thieves do.

        4. “No, fuck you and your dogmatism. What does fiscal policy have to do with individual rights?”

          THIS:

          “After continued frustration with the Supreme Court, in 1939, Roosevelt established the Executive Office of the President (EOP), the hammer of modern presidential Constitutional work-around; Many of Roosevelt’s executive orders were clearly indifferent to civil liberties and democratic values, most notably his February 1942 order that authorized the internment of thousands of Japanese Americans in World War II.”

      2. Should have realized that Tony would not get the point, or pretend not to.

        Fucking ideological consistency, how does it work?

    7. Keynesian theory was falsified hard by the stagflation of the 1970’s. You want us to subscribe to a theory that relies on the concept of “animal spirits”? Seriously? Why not just say that the recession occurred because the credit fairies were in a snit?

      Everything you say is wrong.
      Everything you believe is wrong.
      You are unsuited for rational discourse.
      You should be hiding under your bed, trembling in hideous embarrassment for promoting such an invalid and invalidated theory.

      1. Early Keynesian theory couldn’t account for stagflation, but it’s since been incorporated into it (caused by cost-push inflation). Normal recessions or depressions have been adequately addressed by basic Keynesian theory and exacerbated by classical policies. The current situation, based on demand-side considerations, is pretty much predictable given the level of Keynesian stimulus applied, which, as all Keynesians agree, was just enough to get us here but not enough to return to prior levels of growth and employment.

        1. but not enough to return to prior levels of growth and employment.

          How much is needed to get us there?

          1. Around $3 trillion probably would have done the job.

            1. And if that didn’t work, it’s obvious we should have tried $4 trillion! Whenever it fails, just increase the amount. Someday it will work. It HAS to! That’s T o n y s i a n i s m for you.

            2. Around $3 trillion probably would have done the job.

              And where would this $3 trillion have come from? Taxes, borrowing or printing? What impact would these have had on the economy?

              1. What the fuck would we have spent it on? The money that did get spent got blown out the nation’s collective asshole.

                1. What the fuck would we have spent it on? The money that did get spent got blown out the nation’s collective asshole.

                  Probably it would have been stuck into a political slush fund like much of the Stimulus was.

            3. Around $3 trillion probably would have done the job.

              Total debt accumulation between 1 January and today has been $5.5 trillion. If you think another $3 trillion would have fixed things, you’re delusional.

        2. Re: Tony,

          Early Keynesian theory couldn’t account for stagflation,

          “Early” Austrian economics did. Hazlitt had shown that the idea that you could not have inflation and high unemployment was a fallacy.

          but it’s since been incorporated into it (caused by cost-push inflation).

          Translation: They invented some bullshit term to explain it away.

          Normal recessions or depressions have been adequately addressed by basic Keynesian theory

          No, they haven’t. Pyramid reading is always and suprisingly accurate up to the last minute but, afterwards, becomes surprisingly less accurate. So does the economics equivalent of Pyramid reading: Keynesianism.

          Keynesians predicted a great depression that would happen to the U.S. right after WWII if spending was curtailed. Spending was curtailed by 60%, and the country went into a period of spectacular growth. The Keynesians were pitifully WRONG, and that prediction came from their own economic theories!

          The current situation[…] is pretty much predictable given the level of Keynesian stimulus applied […] not enough to return to prior levels of growth and employment.

          “We need to open and close more ditches!”

          It’s like telling the man without the parachute “Flap your arms faster!”

        3. The current situation, based on demand-side considerations, is pretty much predictable given the level of Keynesian stimulus applied, which, as all Keynesians agree, was just enough to get us here but not enough to return to prior levels of growth and employment.

          So predictable that almost all of the bad things Keynesians said would happen if TARP and the stimulus weren’t enacted have happened. Keynesians agree government spending not high enough. News at 11.

        4. Thanks for clarifying that Keynesian theory is nothing more than non-falsifiable flapdoodle. If a situation arises that clearly should not happen according to the theory, the theory isn’t wrong, it just needs tweaking.

        5. Keynesian Theory requires the economic equivalent of “epicycles” to work halfway correctly. Hence the talk of “normal” recessions as opposed to the (implied) “non-normal recessions.”

          Everything you say is wrong.
          Everything you believe is wrong.
          Give up trying to convince people who are acquainted with how the economy really works that your fairy tale narrative is somehow true.

  6. Johnson has nutty economic policy views and would do tremendous damage to the global economy were he to somehow become president.

    ORLY?

  7. In other words, if Johnson had been president in 2008, he would have allowed the U.S. financial system to collapse and the country to fall into depression. A

    NEEDZ MOAR SLAVERYS AND CANNIBALISMS

    1. And birth control pills would cost a TRILLION dollars!

    2. Cannibalism? No way. Hack journalists are stringy, gamey, and taste like tobacco. Almost as bad as troll.

  8. When the first attempt at TARP failed mid and small sized banks that hadn’t taken the insane risk or made horrible loans offered to buy the troubled assets from the failing banks. Sure they offered to pay only pennies on the dollar but thanks to Sarbanes-Oxley that was better than the zero value that the bug banks were told they were worth. So the big politically connected banks went back to demand a bailout. After adding more pork TARP passed.

    TARP was destined to fail. It bailed out market losers, perpetuated the “too big to fail” stupidity, screwed the banks those banks that had done well, retained Freddie and Fannie’s bad policies, failed to repeal Sarbanes and spent the fed gov. into oblivion. How can this be seen as good on any level? Sure if TARP had truly failed there would have been some panic…by the crony capitalists and their government shills. A temporary shock followed by a stronger and more stable recovery would have been much better than what we ended up with.

    So screw Bloomberg View and screw Too Big to Fail.

  9. I find it curious that in the past when there was an economic downturn, and the government did not intervene, the economy got going again generally in less than two years.

    According to conventional wisdom, any economic downturn that is not rescued by government turns into a depression that can only be ended with government intervention.

    What I find to be even more curious is that whenever the government has “rescued” the economy, as it did in the 30s and today, the economic slump last for years and years and years.

    It’s almost as if the best thing the government can do to fix the economy is to leave it the fuck alone…

    1. It’s almost as if the best thing the government can do to fix the economy is to leave it the fuck alone…

      See, right there is the kind of craziness he was talking about.

    2. CRAZY PERSON!

    3. “were only here to help you” So sayeth the gods of government

      1. “We’re only here to service serve you.” So sayeth the gods of government.

  10. “The underlying question going forward hinges on whether you think cutting federal spending by 43 percent in one year (balancing the budget, in other words) would lead to “another severe recession” and be worse than the fiscal cliff currently scheduled for Jan. 1.”

    Well, maybe he’s an extremist!

    Maybe he thinks the fiscal cliff we’re heading for is a hoax. Maybe he thinks we can go on spending like we are forever, and there won’t be any negative consequences.

    Maybe he’s one of these extremists who thinks that if the fiscal cliff we’re headed for is really a big tax hike, then that’s a good thing. Because raising taxes has no net adverse impact on the economy either…

    But those are really extreme ideological positions with very little real world evidence to support them.

    No, fiscal discipline isn’t extreme, but extremists see it that way! That’s what extremism does to people–it makes them see perfectly rational, mainstream thinking as somehow extreme.

    1. Maybe he thinks we can go on spending like we are forever

      That’s the beauty of it, when you’re using somebody else’s money you CAN go on spending like we are forever.

      1. That’s the beauty of it, when you’re using somebody else’s money you CAN go on spending like we are forever.

        Maggie says that eventually you run out of OPM.

        1. And Aesop says the Goose that lays the gold eggs eventually shits itself to death – or words to that effect.

  11. It’s almost as if the best thing the government can do to fix the economy is to leave it the fuck alone…

    But deregulation caused this!

    1. Whenever I hear that I ask for specifics.
      What regulations were repealed? “Oh, the entire banking system was deregulated, everyone knows that” Really? Ever talked with anyone in the banking system? “Wall Street was deregulate! Casino capitalism!” Really? Ever talked with anyone on Wall Street? “I don’t have to! Everyone knows it’s true!”

      Derp reigns supreme.

      1. They’re right about casino capitalism being the cause. They’re wrong about “deregulation” being the cause of casino capitalism. In fact, the banking system and regulatory system are expressly set up – by government/Wall Street/bank collusion – to provide returns by shuffling paper and printing debt-backed money.

        1. What does ‘casino capitalism’ even mean? It sounds like it could fit on a bumper sticker. Please note that is not a compliment.

          1. Basically, it’s a incoherently snappy way of saying that profits are privatized and losses socialized. That arrangement removes any discipline from the people engaging in economic activity, since wild, high risk behavior carries little downside.

            I prefer to use the term “Greenspan Put”, but in these barbaric times, few people know what a “put” is.

          2. I think ‘casino capitalism’ means rich people gambling with poor peoples’ money, keeping the winnings, and passing the losses to the poor.

            It has something to do with rich people, that much I know. And once someone says “rich people” you’re supposed to have an emotional reaction because you’re supposed to hate all rich people.

            Except liberal rich people like Buffet or various celebrities. They’re OK.

            1. I’ve never understood the love for Buffet. He got rich selling Marlboros, Big Macs, and Coke.

              1. Ideology trumps actions.

        2. JP has hit it on the head.

        3. In fact, the banking system and regulatory system are expressly set up – by government/Wall Street/bank collusion – to provide returns by shuffling paper and printing debt-backed money.

          It’s been said that fiat money is like a degenerate gambler’s markers or IOUs. Those of some gamblers appear to be worth more than those of others, or to trade at less of a discount. But they are still just IOUs backed by nothing but bs – though in the case of the gambler they’re at least backed by the fear of losing his ability to walk. Governments and central banks on the other hand seem unconcerned – as long as they can keep kicking the can down the road for the next batch of degerates in office to deal with.

      2. Derpage is an honest mistake or just plain ignorance of the subject. “I don’t have to [listen to facts]! Everyone knows it’s true!” is willful ignorance, or valuing the narrative over the facts.

        1. The problem is that so many people have faith in the government to fix things.

          The same kind of faith that religious people have about their higher power.

          To suggest that government makes the economy worse is tantamount to heresy.

          Then again, libertarians and Austrians get accused of worshiping the market.

          1. The same kind of faith that religious people have about their higher power.

            Yep, True Believers all the way down.

          2. They’re called Top. Men. for a reason!

            1. Because they like to “bottom” people? 🙂

      3. The (partial) repeal of Glass Steagall is the only thing anybody ever says. If you ask what, exactly, that did, the stuttering and derping begins.

        Even more comical is that the guy who wrote the bill (Glass) wanted the restrictions removed after 2 years.

        1. Didn’t Clinton sign that bill? If so, why is Bush to blame?

          1. Didn’t you watch the movie *Freaky Friday,* when Clinton and Bush exchanged souls, so that Bush was in Clinton’s body doing things for which Clinton got blamed?

            1. I’m afraid I missed that one.

            2. So actually it was Bush’s seegar that Monica was smoking rather than Slick Willy’s? Sounds like something Clinton might have told Hilary.

    2. http://www.tomwoods.com/blog/r…..he-crisis/

      “When we recall that stand-alone institutions, both commercial and investment, also failed during the crisis, and that all of them acquired mortgage-backed securities (which they had always been allowed to do, by the way), the Glass-Steagall “repeal” looks more and more like a red herring that appeals to people whose belief system requires them to find some way a Fed-fueled bubble could have been stopped had the right regulatory structure been in place.”

  12. In other words, if Johnson had been president in 2008, he would have allowed the U.S. financial system to collapse and the country to fall into depression. And if he became president now, he would do his best to strangle the tepid recovery we are enjoying and turn it into another severe recession.

    That statement right there shows what a fucking moron this guy is. I guess he hasn’t seen the massive, steady drop in the Labor force participation rate over the last 12 years, nor paid attention to all the small banks that were shuttered because they didn’t have the same lobbyists on the Hill as the Big Five.

  13. Wow, that link to Bush’s speech really is classic:
    “More banks could fail, including some in your community.” Check

    “The stock market would drop even more, which would reduce the value of your retirement account.” Check

    “The value of your home could plummet.” Check.

    “Foreclosures would rise dramatically.” Check.

    “And if you own a business or a farm, you would find it harder and more expensive to get credit.” Check.

    “More businesses would close their doors,” Check.

    “and millions of Americans could lose their jobs.” Double Check.

    “Even if you have good credit history, it would be more difficult for you to get the loans you need to buy a car or send your children to college.” Check.

    “And ultimately, our country could experience a long and painful recession.” And check.

    Don’t these people feel any obligation to explain why their predictions are so consistently wrong?

    1. Don’t these people feel any obligation to explain why their predictions are so consistently wrong?

      Definition of economics. So you’d think that they would be obligated to explain it, except that we’re talking about fucking politicians, who only feel obligated to piss on your head and tell you it’s raining.

    2. Yeah, funny how everything they said would happen if TARP wasn’t passed happened anyway.

      One of the few times that both liberals and conservatives were on the same side about something, and Congress said, “Fuck you, that’s why,” and passed it anyway.

      1. Yeah, funny how everything they said would happen if TARP wasn’t passed happened anyway.

        Yup. And the one thing they didn’t mention would happen – extremely reduced government spending, size and growth of government at all levels, due to the bottom falling out of their revenue streams – didn’t happen. Guess that just slipped their minds – or whatever it is they have between their jug handles.

  14. if Johnson had been president in 2008

    As usual, the Fed/Treasury apologist media puppets use the collapse of Lehman as “day zero” of an easily foreseeable slow motion trainwreck which began at least a decade before.

    1. SHUT YOUR WHORE MOUTH! GREENSPAN WAS A GOD, A GOD!!!

  15. All they got is “It would a’ been worse! IT WOULD A’ BEEN WORRRRSE!!!!”
    It’s all they ever got.

  16. Austerity: More deadly than a drone strike!

  17. Considering that Johnson isn’t going to win the White House, no matter how many crazy libertarian nutrolls support him, I have to wonder what Barro’s point was in writing this column.

    Don’t worry, Joshy, that maniac won’t have a chance to let losers fail and give businesses a stable regulatory climate. No matter who wins in November, their firm hands and sodden tits will still be open for business.

    1. Everybody needs a whipping boy to flog. It’s good for morale.

      1. I see it as an encouraging sign. Barro is paying attention to what’s happening in Reason-land and Libertopia. And his editor feels that a story about libertarian viewpoints is not totally irrelevant. The more publicity, the better.

        1. ^This. Good point DJK. They may hate us, but when they admit they can’t win without libertarian votes, and that those votes must be earned through policy, the game will change.

        2. Except that most people will read his shit and accept it as gospel without a second thought.

          Yeah, we’re the “Crazies”. For wanting the government’s spending to match it’s revenue. For wanting to stop foreign wars and close down a few military bases in foreign countries that either don’t need our protection or don’t want us there in the first place. For wanting and end to the destructive “war on drugs” that lock up millions and destroy lives. For wanting to end the drone strikes in countries that we’re not even at war with. Yeah, we’re crazy wackadoo nutjobs.

    2. But, but those nutjob libertarians are going to cost Barro’s team the election!

  18. Sometimes I contemplate suicide when I read things like this. Then I think, “No, it’s THAT dumb motherfucker who should be removed from polite (and sentient society.” But, of course, that would involve force, and probably murder. And that’s wrong, so I’d end up in jail. Which just makes me wanna commit suicide…

  19. In other words, if Johnson had been president in 2008, he would have allowed the U.S. financial system to collapse and the country to fall into depression. And if he became president now, he would do his best to strangle the tepid recovery we are enjoying and turn it into another severe recession.

    All true. What Barro misses is that the collapse and depression are utterly unavoidable no matter what. Bailouts and credit expansion delay the inevitable and make it worse. The “tepid recovery” is laying the groundwork for an even worse crash down the line, and this time there will be no bailouts, because it will be money itself that dies.

    1. These people don’t understand/accept that the recession is the result of misallocated capital and that any attempts to fix the job market will only worsen the misallocation of capital. To them, the only thing that matters is the unemployment rate, everything else is a secondary consideration.

    2. it will be money itself that dies.

      Can we actually detect a pulse on the dollar?

  20. Of course Obama followed the advice of Christina Roamer and the rest of his economic advisers, which in fairness were pretty much a dream team of Keynesian economists. And every single forcast they made was wrong and every single policy they advocated was adopted and completely failed to live up to expectations. The story of the Obama administration, when it is written, is going to be about the complete failure of Keynsian economic modeling. And all of the gloom and doom about “had Johnson been President in 08 the world would have ended” is based on these now discredited models.

    1. The model will never be discredited until the system collapses. Period.

      For mainstream politicians to admit otherwise would be a direct repudiation of the policies of both major parties for the last 90 years. Just isn’t going to happen.

      1. When the system collapses it will be because the government didn’t do enough. Free markets caused the collapse. We need to draft a new Constitution that outlaws free markets. Put Top Men in control. Then nothing can go wrong.

        1. I don’t think people will feel that way when all of their government pension checks are worthless.

          1. Blame it on the rich fat cats. Capitalist pigs. They caused this mess. Loot ’em. Use that to pay the pension checks.

            1. And they might do that, but it still won’t be enough to cover the checks and then who will they blame? The Jews?

              1. They certainly won’t blame themselves, that’s for sure.

                When the system collapses, what rises from the ashes will not be small government and liberty.

                It will be socialistic totalitarianism.

                Liberty will be a blip on the history books as Man returns to his default state: slavery.

                1. Heinline said it best sarcasmic. That is just bad luck.

          2. They’ll never be completely worthless, Scruffster; they can always be used as fuel, bumwipe or notepaper.

            1. Not even that. They are all direct deposit now. No paper cheques.

      2. It is worse than that. The problem is that the ideas are so entrenched among people who should know better. Take Mrs. McArdle for example. She spouted all of the Keynsian nonsense she learned at Wharton in support of TARP four years ago. I could forgive her for that. I have spouted my share of Keynesian nonsense over the years. Everyone who ever got a decent economics degree has at one point in time or another. But the events of the last five years have completely cured me of that. All of those nifty equations I learned how to do in advance macro economics and econometrics are basically bullshit. They don’t reflect reality.

        I have admitted this but McArcdle and tons of others like her have not and probabably never will. The reason is that the truth is actually pretty brtual, fairly simple and generally fits with common sense. You really don’t need all of the fancy equations to understand how the economy and the world works. And for someone like McArdle who has spent her entire life being told she is special and one of the best and brightest, that is a very bitter pill.

        1. How did the 70s not cure you of keynesian bullshit?

          1. It did to a very large degree. But anyone who has been through a mainstream economics program gets infected with it. And you can read the 70s as a failure of demand side stimulus and the 80s as the success of the supply side stimulus.

        2. “All of those nifty equations I learned how to do in advance macro economics and econometrics are basically bullshit. They don’t reflect reality.”

          At a time when the banks weren’t making any loans–because they didn’t have sufficient reserves to allow for the loans they already had outstanding–why should we be worried about people’s marginal propensity to save?

          At one point, the Obama Administration was both fighting to get the stimulus passed–because of the liquidity trap–and out of the other side of their mouths, they were buying up toxic assets of stress tested banks–because the banks had insufficient reserves!

          When the banks are starving for reserves, IF IF IF people want to put their money in the banks, why would you spend their future incomes for them to try to stop them from saving their money and giving the banks more reserves?

          It just doesn’t make sense on its face. The problem with the macro view of anything is that consumers and firms just don’t perceive the world that way! …and with Keynes, the prescription just doesn’t and can’t account for what the real world sees from its bottom-up view.

          P.S. And it really should be said that Keynes wasn’t anywhere near as stupid as the supporters of the Obama Administration make him out to be. Keynes idea about what to do with the liquidity trap does not translate into Tony’s stupid suggestion that in all places and at all times, the more we spend, the more the economy grows.

          1. And it really should be said that Keynes wasn’t anywhere near as stupid as the supporters of the Obama Administration make him out to be.

            This. I give Keynes himself more credit than I do his moron followers like Krugman. At least Keynes realized that there was a limit to his methods.

            1. I have to agree. At least he knew counter cyclical policies were dependent on a high rate of savings with room for expansion in capital goods, iow, not an absolute rejection of Say’s Law that modern Keynesians indulge in, to have any chance at success.

          2. Your PS is dead correct Ken. And what was never mentioned is that there are a ton of Keynesian stimulus’ built into the system now that didn’t exist during the 29 crash. We have entitlement programs that approach a trillion dollars a year. We have a defense budget that drops money into businesses all over the country and military families. The idea that you could have a liquidity trap with a multi trillion dollar government shoveling money out the door is fucking absurd and Keynes would have said as much.

          3. RE: the PS

            There is the story of Keynes leaving the meeting in the White House and saying something along the lines of: “I was the only non-Keynesian in the meeting.”

        3. “When the banks are starving for reserves, IF IF IF people want to put their money in the banks, why would you spend their future incomes for them to try to stop them from saving their money and giving the banks more reserves?”

          During some of the worst of it, Bank of America paid me $100 to open a checking account!

          Holy shit, they needed reserves!

          Meanwhile, the Obama Administration was fighting my marginal propensity to save with stimulus–and bailing out BofA, too? Bailing out BofA ’cause they had insufficient reserves?!

          That is stupid on its face from a micro perspective.

          1. They would have been better off just taking the trillion dollars, having a national lottery and then paying off all of the winner’s mortgages. As crazy as that sounds, it would have cleared up a ton of bad mortgages, infused the banks with a ton of reserves, and got the housing market moving by allowing people who were previously under water on their mortgages to now sell.

            I wouldn’t advocate that plan. But it would have been better than what they did.

            1. Almost anything would’ve been better than what they did. I actually liked Barr’s plan of just giving everyone in the country the cash, and taxing it as income if it wasn’t put in a retirement or investment account. Like the lottery, it would’ve been worse than nothing, but still better than what actually happened.

            2. Isn’t that basically robc’s stimulus plan?

              Which he also SLDs, of course, but it would have made a lot more sense.

        4. Or anyone who got a decent econ degree NEVER spouted Keynesian bullshit because they had better professors… #GMU

    2. Anybody that writes an honest evaluation of Obama’s economic policies will be denounced as an infidel heretic by anyone who was ever under the spell of the Obama personality cult.

      These personality cults that rise up around various leftist leaders–it’s not a coincidence…

      You can’t really believe in that sort of leftist economic policy without some form of faith–and that sort of faith is the stuff that personality cults like Obama’s are made of.

      That’s what “Hope and Change” are all about.

      1. It is more than just that. Liberals in 08-10 finally got exactly what they wanted. Obama is the first real liberal to ever be elected President. His economics team was really “top men” from the Ivy leagues. And it ended in complete disaster. It made things worse. His entire administration stands as a real world repudiation of not just his followers but really the entire liberal academic and political class. Keynsian economics and government controlled health care is the air these people breath. It is just what all right thinking people believe. And it has once again been shown to be complete nonsense.

        1. BUT BUT RETHUGLICAN FILIBUSTERS

          It’s almost too bad he didn’t have a supermajority in both houses for his whole term, isn’t it?

          1. It is funny to think that they really thought passing Obamacare was going to ensure a perminent Democratic majority. They really thought it would work and be wildly popular. Here we are two years later and they are looking at being totally out of power. But they are so arrogant and deluded they can never admit how badly they fucked up. So they will never get any smarter.

            1. I remember when ObamaCare was going to make America more competitive in the global marketplace and reduce the deficit.

              1. Bend the cost curve was my favorite. Passing it was the only alternative because the current system was so bad.

  21. Josh Barro needs to read some Robert Barro.

  22. I do think Johnson in 2009 would have caused a worse economy, maybe even a “depression”. And it would have ended about 2010 and we would be growing at an insane rate now.

    Controlled growth is death. We need sharp upswings and downswings to have a healthy economy.

    1. Know what else is death? Thoughtcrime. And you just committed it.

    2. I don’t think he would have caused a depression. The credit markets were never frozen. The whole thing was just a lie to ensure that some very important people didn’t have to become ordinary millionaires again.

      1. Even better.

        I figured the bankruptcy of 3 or 4 major banks might have sent us there, but really, is there a clear dividing line between recession and depression anyway?

        1. We are sitting at close to zero growth and real unemployment at nearly 20%. There isn’t much of one.

        2. A bank going bankrupt doesn’t mean it goes way.

          Airlines go bankrupt and are flying planes the very next day.

          The threat of banks going bankrupt is only scary if you don’t know what bankruptcy is.

          1. The problem was AIG and the annuities. A lot of people’s retirements would have gone away. But we could have dealth with that after the fact. For less than the price of TARP we could have just made good on the middle class’s retirements and been okay. But doing that would have meant looking out for someone other than the assholes who run Wall Street. And we can’t have that.

            1. Bingo. The problem was that Wall Street was doomed. People can’t wrap their heads around the concept that Wall Street is not the economic engine of the USA. Moving money and skimming off the top does not generate true wealth.

              1. There will always be someone looking to move money and skim off the top. That is the nature of the game. The problem is that we have gotten to the point that we refuse to let anyone ever lose money. With great risk comes great reward has morphed into, with great reward there can be no risk.

              2. A functioning price system is necessary for markets to work, and that’s what Wall Street’s job.
                Though sometimes they get it wrong. When they do the “loss” part of “profit and loss” is supposed to kick in. That’s how free markets work. You pay for your mistakes. Literally.

                Unless you’ve got friends in government.

                1. A functioning price system is necessary for markets to work

                  That’s my point. Wall Street has ceased to be a functioning price system. Stock prices are openly manipulated. HFT operations are completely non-connected to the actual value of a stock. The Fed buys up treasuries to artificially prop up the bond market. Who doesn’t think gold prices are at least partially manipulated by the government?

                  Add to that, we no longer have a predictable bankruptcy system because of the GM fiasco.

                  This is not a functioning price system.

              3. It’s astounding how libertarians are still accused of shilling for Wall Street, or whatever other ad hominem is convenient at a given moment.

            2. TARP guaranteed Goldman Sachs wouldn’t lose money, and that was more importnat than anything else.

      2. The recession was inevitable no matter what anyone did. And the fact of the matter is that as long as government spending is counted as a positive element of the GDP equation, any pullback in baseline spending will result in an equivalent drop in GDP, at least for a time.

        A long-term stable economy, however, is built on capital formation and investment, not goverment deficit spending. We’re bringing in the same revenue as a percentage of GDP that we did in 1960, when the tax rates where a lot higher–the difference was that there was much more private capital investment going on that kept the economy humming. In addition, debt and government spending was vastly lower than it is now, even on an inflation-adjusted basis.

    3. And it would have ended about 2010 and we would be growing at an insane rate now.

      No we wouldn’t, unless you know where the $30/bbl oil is.

      1. Yeah because markets never adjust to the price of energy.

        1. Poverty is a kind of adjustment.

          1. So you are saying we can never have a gorwing economy if the price of oil is above $30 a barrall? That will come as a hell of a surprise to the people in the 1950s and 60s who had quite a nice growth rate despite oil being higher, when adjusted for inflation, than it is now.

      2. No we wouldn’t, unless you know where the $30/bbl oil is.

        I know exactly where it is. The same place that gold is $300/oz.

      3. Well, the $70/bbl oil is in Iran.

  23. I am in the camp that believes cutting government spending has a positive, not negative, impact on the economy, as was the case in post-war America, 1980s New Zealand, and 1990s Canada.

    The New Zealand case history doesn’t get nearly enough play.

  24. This bullshit about less government intervention and freer markets leading to poor economic results is totally insane. Okay, fine, leftists want to social engineer and enforce some sort of equality of position for everyone in the country. I get that. So just say that Johnson’s policies will lead to people dependent on welfare and other government support having to fend for themselves, with some inevitably failing. That’s at least an argument. But don’t make up something that is totally contradicted by the entire history of economics.

    1. I agree, that’s at least an honest argument, and it even has some historic validity to it. This Keynesian garbage is the same as saying that communism would work great, if only the right people were in charge.

      1. I’m distressed at how much the left is into denying reality these days. It’s a very dangerous trend and a hallmark of much more authoritarian regimes.

        Not that the right isn’t delusional, too, but this kind of nonsense is just flat-out wrong. Not even rationally debatable.

        Capitalism can be criticized from the perspective of haves and have-nots. I’d argue that a freer market helps everyone to some extent and provides a wealthier society for doing things like charity, etc., but the best argument is that it works better than having a corrupt and powerful government redistributing wealth for political reasons and, for that matter, inefficiently. But again, at least this is an argument. Whether free markets out perform controlled economies is not.

        1. For the Right to be like the Left is today, they would have to be claiming that George Bush would have been the greatest President ever if only the evil Democrats didn’t keep him from fully implimenting his plans.

          The complete lack of soul searching and self examination on the Left is really disturbing. It means that no matter how badly things turn out, they will never learn from their mistakes.

          1. What mistakes?

          2. How do you love Obama but hate Bush? This isn’t just some libertarian “THEY ARE ALL THE SAME” comment–they really have had quite similar administrations. Both have expanded social welfare programs, both have increased federal power, both have used the war power improperly, both have fully supported the WoD, both bailed out businesses that should’ve been allowed to fail and have otherwise intervened in the marketplace, both have added to the overall regulatory burden, both have supported unconstitutional actions in connection with the WoT–do I need to keep typing?

            1. And Bush was the most bipartisan President since Nixon. Every single significant thing Bush did, he did with significant and many times even majority support from the Democrats in Congress.

              Bush was this evil Texas Cowboy radical who somehow managed to get Democratic support for everything he ever did.

              Democrats hating Bush is like Republicans hating Clinton for cutting the capital gains tax and balancing the budget.

              1. Are you suggesting that starting massive fucked up wars based on lies, or exploding the deficit via pointless tax cuts, are Democratic priorities?

                Bush earned the scorn he gets. It’s a highly disingenuous game you play when you pretend to require Obama to be absolutely perfect in every way before he can be favorably compared to Bush.

                1. Are you suggesting that starting massive fucked up wars based on lies … are Democratic priorities?

                  Actually, I consider that particular priority to be very bipartisan in nature.

                2. Are you suggesting that starting massive fucked up wars based on lies, or exploding the deficit via pointless tax cuts, are Democratic priorities?

                  If they are not priorities, why did so many Democrats happily vote for them Tony? The Democrats controlled the Senate from 00 to 02. Every single one of them voted to go to war in Afghanistan and all but one of them voted for the Patriot Act. And the Democrats all voted for Bush’s budgets. And Pelosi and Reid wrote the budgets post 06.

                  Yeah Tony., Bush was a massively successful bi-partisan President who succeeded in working with Democrats to give them tons of shit they wanted. That is his legacy more than anything.

                3. Bush is not my standard. He’s yours. I’m suggesting a better way.

                4. Are you suggesting that starting massive fucked up wars

                  Actually, CONGRESS starts wars. And as to starting wars, you can take your pick between giving false information to get support FROM Congress and just plain going to war WITHOUT Congress declaring war. Going to war directly without Congressional approval is just the next step from what Bush did. Instead of making up a reason for Congress, just don’t consult them at all! It’s worked out very well for Bush 2.0

                  or exploding the deficit via pointless tax cuts

                  It’s debatable that the Bush tax cuts are at fault, since revenue went up after them. And isn’t Obama keeping 80% of those cuts? Also, cuts are not spending. SPENDING is spending. It’s not a revenue problem, it’s a spending problem.

                  are Democratic priorities

                  Both starting wars AND increasing the deficit seem to be modern Democratic priorities. Not that the Reps are any better.

                  Bush earned the scorn he gets.

                  And so does Obama.

                  It’s a highly disingenuous game you play when you pretend to require Obama to be absolutely perfect in every way before he can be favorably compared to Bush.

                  Bullshit, as you well know. The point in the thread you’re responding to is that they SHOULD be regarded as the same, or at least very similar.

                5. T o n y| 10.26.12 @ 11:59AM |#

                  Are you suggesting that starting massive fucked up wars based on lies…

                  Teddy Roosevelt was a progressive.

                  The spanish american war was probably the classic case study in ‘wars based on lies’

                  Then you have Kennedy & Vietnam.

                  johnson did a bang up job making a bad situation worse.

                  Really…. anyone who calls themselves a ‘liberal’ and remains blithely unaware that most wars of the 20th century happened under their own rule deserves being urinated on by everyone

  25. I can’t stand the arrogance of the idea that a collapse should be prevented just because shit would suck, like shit not sucking is an entitlement.

  26. Because I havent seen this here in a while.

  27. While I do not believe that Gary Johnson’s ideas on the economy are dangerous (I personally like them) – I believe that a vote for the former Governor is ill-considered because every vote he gets is one less for Mitt Romney which means all GaJo votes are cast by default for Obama.

    1. Fuck that. If a Libertarian (or perhaps other third party) weren’t on the ballot, I wouldn’t vote for the office at all. When my choice is between an R and D only, I leave that part of the ballot blank. Always have, always will. Why do you want to disenfranchise me, g-f?

    2. I thought every GaJo vote was cast by default for Romney?

      It makes just as much fucking sense, you fucking moron.

      My vote for Johnson says “Fuck you Obama.” Also “Fuck you Romney.”

      And Romney still wins KY by about 18.

      1. The beauty of my GaJo vote is that it’s a precious, precious Ohio vote. Bwahahahahaha!

      2. This is much harder to convince people of in Pennsylvania.

        “But Obama might lose Pennsylvania!”

        I don’t give a fuck who wins. I just want GJ to get more than the difference in their vote totals.

    3. If you repeat this enough, does it then become true? Everyone on the right is absolutely dead certain of this, despite every actual scrap of factual evidence continuing to show he pulls about evenly from both sides.

    4. You assume that Romney is every GJ voter’s second choice.

    5. I see, so when I THINK I’m voting for Gary Johnson, I’m really voting for Obama? Maybe you could help me out here, I really don’t want to vote for Obama but I don’t want to vote for Romney either… Who does my vote go to if I vote for –

      Jill Stein?
      Vermin Supreme?
      Cobra Commander?
      A fwuffy kitten?

      Also, for whom do I vote if I actually want my vote to count for Gary Fucking Johnson?

      Conservatives are generally supposed to hate the progressive idea that your money belongs to the government by default, so government spending is really largesse and tax cuts are really spending. That being the case, why do so many conservatives subscribe so readily to the idea that your vote belongs by default to the two major parties, so any vote is always for one of them, even when it’s not?

      1. A VOTE FOR VERMIN SUPREME IS A VOTE FOR FREEDOM

      2. Republicans aren’t Conservatives.

        They have exactly the same worldview as Democrats.

  28. every vote he gets is one less for Mitt Romney which means all GaJo votes are cast by default for Obama.

    VOTE FOR THE LESSER OTHER EVIL

    1. I’m trying to decide which evil is lesser this year for my vote: Cthulhu or Khorne?

      1. I voted for Kodo

  29. I saw Greenspan and his wife at a restaurant once in Washington. I really thought about walking up to his table and saying “you sir are a scoundrel who ruined the US economy” or something sufficiently indignent and Victorian. The Victorians were always the best at public shamming. I of course chickened out. But I should not have.

    1. I would have asked why he accepted the job that Galt turned down.

    2. Would have given him a sotto voce “And to think this guy was once an Objectivist.”

    3. You will regret that you didn’t until your dying day.

  30. indignent

    You were a pissed-off hobo?

    1. A Victorian hobo. “Hey, Guv, a ha’penny for me troubles? Oh, you’re that blighter with the barmy policy that cocked up the economy! Gordon Bennett!”

      1. Everyone has their embarassing fashion stages. I had my Victorian hobo stage for a few years.

        1. I’m still passing through my Hawaiian shirt phase.

          1. And now I’m trapped. I go to my doctor the other day for bronchitis and the first thing he asks me is — “Where’s the Hawaiian shirt?” I think my drab attire that morning is how he knew I was really feeling rotten.

            1. I hope you’re bald and at least 40 pounds overweight. Otherwise, what’s the point of a Hawaiian shirt?

            2. I like Hawaiian shirts because they hide the concealed handgun nicely. Of course, my shirts trend black and white only.

  31. You were a pissed-off hobo?

    We’re all pissed-off hobos, now.

    1. “I hope that one day I can say, ‘We are all poor now!'” *wild applause*

    1. If that is true, then David Petreus’ head needs to be on a platter. I am not surprised by this. These people hate the use of force. I can totally see them thinking “but if we send in the military it will look aggressive and alienate the population”.

    2. “Amateur hour” doesn’t even begin to describe this shit. What a clusterfuck.

      Fox News has learned that there were two military surveillance drones redirected to Benghazi shortly after the attack on the Consulate began. … Both were capable of sending real time visuals back to U.S. officials in Washington, D.C. Any U.S. official or agency with the proper clearance, including the White House Situation Room, State Department, CIA, Pentagon and others, could call up that video in real time on their computers.

      Yet allegedly Obama didn’t know that is was a large scale terrorist attack as opposed to a protest over a youtube video until days later? BULLSHIT.

    3. Wow. So is this the motive behind the “YouTube video” cover up?

    4. If Sam Axe had been there, our boys would still be alive today.

  32. Fucking TARP/Stimulus supporting economist. They should take any professional licensing and educational certification they have, ball up into a tight slug, and then shoot into their brain cavity to rattle around for awhile in the vast emptiness between their ears. There is no excuse for their belief system at this late date.

  33. Journalists should be required to pass the Series 7 before speaking on anything vaguely related to money or macroeconomics

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