tag:blogger.com,1999:blog-2277215496195926573.post1370938279506673703..comments2024-01-01T07:41:51.347-08:00Comments on RALPHONOMICS: Tim Worstall’s hopeless criticism of Krugman and Layard.Ralph Musgravehttp://www.blogger.com/profile/09443857766263185665noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-2277215496195926573.post-77390190524511779492012-07-06T00:53:39.738-07:002012-07-06T00:53:39.738-07:00I don’t think a dose of Keynsian stimulus NECESSAR...I don’t think a dose of Keynsian stimulus NECESSARILY involves “incentive reducing” state hand outs. That is, a right-wing government implementing stimulus could channel the extra money into household pockets, rather than the public sector. Plus in as far as the extra spending went to the public sector, the extra money could be channelled towards areas that don’t reduce incentives, e.g. the military, law enforcement, state education, etc.Ralph Musgravehttps://www.blogger.com/profile/09443857766263185665noreply@blogger.comtag:blogger.com,1999:blog-2277215496195926573.post-60085657921766089802012-07-04T04:49:36.500-07:002012-07-04T04:49:36.500-07:00Is there a problem the other way round? Govts los...Is there a problem the other way round? Govts lose their nerve in bad times and don't let rip with borrowing and spending? That's just as bad as not tightening in good times.Lukenoreply@blogger.comtag:blogger.com,1999:blog-2277215496195926573.post-53533957015400567892012-07-01T14:00:36.776-07:002012-07-01T14:00:36.776-07:00Remains to be seen to be believed, but few, if any...Remains to be seen to be believed, but few, if any, have ever read Keynes.<br /><br />"Common sense" tells us that deficits are unsustainable but we have had them for ever means nothing to "common sense". <br /><br />The real argument is how much government intrusion in our lives do we want. Not paying for it or bankrupting our children or other scare tactics are but rhetorical exercises. <br /><br />Do we want everyone receiving a government check? <br /><br />And how do we get out of the inevitable sloth and waste this incurs. (we tend to forget that the Soviet system was just that! Everybody on the government payroll.)bosscauserhttps://www.blogger.com/profile/10284736135463326098noreply@blogger.comtag:blogger.com,1999:blog-2277215496195926573.post-44464141785769224372012-07-01T03:52:17.355-07:002012-07-01T03:52:17.355-07:00"it gives us 1930s style decade long mass une..."it gives us 1930s style decade long mass unemployment and human misery."<br /><br />It's worse than that. It requires a depression - because that's the only way classic believers can see the bad debts and bad assets eliminating each other.<br /><br />Unfortunately that takes out a huge chunk of good infrastructure and good investment as well - just as collateral damage.<br /><br />Keynesian response just validates the financial asset by swapping the failed liability for a functional liability (usually 'money'), while allowing the failed liability to disappear. That resets the system without the collateral damage.<br /><br />Quite why Worstall can't see that is down to pure religious belief - usually of the fire and brimstone variety.NeilWhttps://www.blogger.com/profile/11565959939525324309noreply@blogger.com