Yet you weep for others’ economic ignorance.

Sparkie,

Next to Dino, who has apparently retired in defeat, you’re just about the last person here to be pontificating on the “economic ignorance” of anyone else. Philosophy, no doubt. But economics??? Fugetaboutit!!!

Krugman although an economists seems to have learned nothing in college. Krugman is a moron.

Since Krugman lied about the “cost” of the Bush tax rate cuts… and clearly did so deliberately, there is no earthly reason to give credence to anything else he has to say. The former Enron advisor is the only economist in history to have his very own “truth squad” devoted to the full time task of unraveling Krugman’s assorted lies, misstatements and confused babble.

AV,

I have neither the time nor the energy now, but I’d like to discuss that Prabhat Patnaik quote. I don’t know if what he says about Keynes is correct or not, though I will certainly find out, but the assessment of free market capitalism that he assigns to Keynes is clearly mistaken. We’ll have to discuss it some time.

Bat One, to be honest I can’t remember reading anything where Keynes says anything like Patnaik’s quote. But I still haven’t read The General Theory of Employment, Interest, and Money (though I’m more interested in New Keynesian Economics).

I may have have chosen that quote for partisan-hackery reasons.

There is even a school of thought that speculation in financial markets actually increases fluidity in those markets, therefore the speculator is actually providing a service to the market. (Though this was explained to me by a speculator.)

Rob, I’m not personally a fan of state-capitalism, but that doesn’t mean that I don’t understand some of the state-capitalist theories, and what needs to be done in certain situations.

But I like eating, having a roof over me at night, that sort of thing. So I’m pragmatic enough to advocate for what is in my (and my friends’, family’s, and even society’s) short-term interests.

If we tried to balance the budget at all costs then that would mean more unemployment and recession than necessary. “Balanced budgets” is simply ideology.

(Yeah, Dino seems to have disappeared. Shame, he is entertaining.)

Oops, yeah, you’re right. I’ve zero formal economics tuition (I doubt you’ll be surprised) so I occasionally muddle terms. Every field has its own jargon.

In physics we tend to use the term fluid for something that freely flows (due to an applied shear stress), and liquid is a state of matter. So my term is more betterer!!

Back to Keynes, he was a fan of markets, as all economists are? He came up with his fiscal policy ideas as a result of the Great Depression. In his mind he was saving capitalism, since in much of Europe (and even somewhat in the US) the populace was calling for the nationalization of industries to restore employment. This had the elite running scared but Keynes was like “saving capitalism is easy, here’s the recipe, buy my book.” (Not exact quote.)

His works tend to be romanticized by the left and vilified by the right though.

Krugman has lost credibility as an economist.

There is even a school of thought that speculation in financial markets actually increases fluidity in those markets, therefore the speculator is actually providing a service to the market.

AV,

I believe the correct term for what you describe is “liquidity.” And, yes, it is most certainly a “service” to the markets regardless of what sort of markets and what sort of products or commodities you’re talking about… from carrots to crude oil and from tomatoes to T-Bills. It’s part of the reason I cringe every time Bill O’Reilly goes on one of his neo-populist rants against oil companies, speculators and the price of gasoline.

The quote you’ve chosen to use as part of your signature is taken from a presentation to the United Nations entitled “Government Must Inject Demand Into The Economy Directly” made by Patnaik, who was part of a four man

high-power task force of the United Nations (U.N.) to recommend reforms of the global financial system. Chaired by Joseph Stiglitz, the other members are Belgian sociologist Francois Houtart and Ecuador’s Minister for Economic Policy Pedro Paez[3].

(Note the absence of any sort of free market representation on that UN team!)

Patnaik’s use of the word “directly” is interesting as it is not clear whether he meant the word in the British sense (i.e. immediately) or the American (i.e. as a function of government policy, such as tax rebates).

Patnaik is regarded as

a staunch critic of neoliberal economic policies, and is known as a social scientist of Marxist-Leninist persuasion.

That signature quote gained common currency when it was referenced extensively by noted “progressive” patron saint, Noam Chomsky, in an interview last November.

I’m not particularly concerned with the accuracy of Patnaik’s attribution to Keynes. It wouldn’t be the first time that Keynes’ work was used to gain credibility for an idea of which he would not have approved. And apostates often cite the tenets of their former faith to rationalize their heresy.

But I am concerned with the galling misunderstanding of basic market function, including that of speculators. (Not to mention the delightful irony of Bill O’Reilly, who is witlessly despised by “progressives” as a conservative, agreeing on something so fundamental with the likes of Patnaik and Chomsky. That is rich!)

I’m not sure how far a discussion of Patnaik’s presumptuous remark will take us, but like every other Marxist/Progressive he is wrong about markets precisely because he mistakes his goal of “social justice” for reality. They are not interchangeable.

Check the link I provided Mickey. How could an $8 trillion housing bubble not increase tax revenue and cause (unsustainable) growth?

We can thank liberal politics for the housing debacle. — Mickey

Liberal (laissez faire) economics maybe. Let me guess, you’re blaming the CRA+Freddie+Fannie? The CRA compelled the big investment banks (like Lehman Brothers) to make zero bad mortgages (because they’re not in that market). They voluntarily bought junk. Try again.

moreover, you are a reagan-lover. that’s when the deficit problem that you fellas always have now came about. that’s when your party started courting the nanny-stating, flatearthing relious fundamentalists. d’oh.

you weep.

Sure, av,that played a part. But a small one. You can’t explain away increased levels of investment for instance.

But riddle me this: if indiscriminate lending provided temporary stimulus that eventually crashed once the bill came due, what do you think will happen with your messiah’s stimulus spending spree?

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