Agreed.

@jlane: of course you can lose money without spending

@drug: don't be stupid, the illuminati conspiracy is about as likely as the moon landing, da vinci code and 9/11 conspiracies. conspiracies expose a distinct flaw in human logic known as the self serving bias

Quote from: Scope on July 01, 2009, 10:46:43 AM

I say step back and lets see what he does. I generally foresee good things coming in the near future.

Things are going down more slowly now.

huh?

Update on Obama's policies: Unemployment is going to reach double digits by the end of the year and possibly even by the end of the month. What happened to 8.2%?

Pianka, I'm not sure where you posted it, but you incorrectly referred to the multiplier effect at one point. The multiplier effect is based on ceteris parabus and doesn't work well in democratic governments. It faces both inside and outside lags.

Sypher, look at the trend in unemployment over the past two decades.  Every time we have a new president, it sky rockets and then slowly goes down over their presidency until once again, we have a new president.

In any case, the Keynesian principle of the fiscal multiplier does play an important role in a democracy.  The reason for this is we have periodic policy changes.  A government with a single administration--such as totalitarian--for decades upon decades shouldn't base its economic strategy on this principle, granted.  However you're neglecting the sway of political direction in America as well as our society's marginal propensity to consume.  We're spenders and we need to spend in our economy.

The Keynesian multiplier was never meant for democracy, regardless of political direction. Just look at the failures of the New Deal which caused the 1937 recession and prolonged the Great Depression. Same sway in political direction, same failure. It took total war and the displacement of millions of Americans to bring us out of the Great Depression. Inside and outside lags prevent all stimuli from reaching the designated markets in time, which is why Keynesian fiscal policies have failed every time they've been tried in America.

I will concede that our economy is 70% service oriented and that we are a consumer nation, but Keynesian policies don't remedy the situation. Keynesian stimulus is borrowed from either the citizens or other nations. In either case, we pay interest on those loans, which ends up costing more than what was pumped into the economy in the first place, especially when the amount is vast. Also, if the money is borrowed from the citizens, then it cannot be called a stimulus, but a redistribution because the wealthy (the largest consumers) are taxed to death in order to foot the bill. Find me one example of Keynesian fiscal policy that has worked in America without causing hyperinflation or double digit unemployment. It didn't work under FDR (unemployment never went below 17%). It didn't work under Nixon. It didn't work under Carter, and it didn't clearly didn't work under Bush Jr.

I don't know where you got the idea we were talking about loans.  Regardless, you must have a warped view of the time period around FDR.  After 12 years of his presidency, the unemployment rate dropped to the lowest it has ever been in the past 120 years.  Lowest ever.  Blaming him for it being high in the first place is like giving Bush credit for Clinton's economic achievements simply because they didn't end immediately when Bush came into office.

Despite that, my take on the Keynesian principle is that it will shift away from service if we continue to create and spend within our economy.  The reason America is the powerhouse it is today is because we've had expendable cheap labor for our entire history.  Now that we don't want Mexicans to come and be that cheap labor, we have become service-oriented.  The New Deal is the reason we came out of the depression.  It's the same reason Hitler's strategy built Germany up so strong after a war that utterly crippled their country economically.  You put people back to work building both public works projects and arms.  The economy and country boom.

its good to switch parties every election anyways.

democrat and repub? its good to switch every election.

Obama > *
you rascist!

why do ppl post shit like this? lol...

imo obama is alot of bullshit.
seems to me hes making the hard workers pay more, rewarding the unemployed niggers, making his friends rich, going to the moon (a huge waste of money, wtf is there on the moon? yeah lets go play golf drive a car and plant flags there rofl) but i would really like to see what he does in the future, hope all u obama lovers are prepared to have your heart broken.