Is more debt worth Keynesian policy?

Nope, mere advertisement of what I said: comparison is vital in terms of understanding the exact nature of the (often inter-linked) inefficiencies. I didn't actually have to type anything. You're doing a jolly good job in destroying the original argument.

That its a market failure is bleedin obvious. The empirical evidence also shows the success in the interventionist solution.

Private firms essentially under-invest. That reflects numerous aspects, from financial sector failures to short termism within managerial control (such as investment skewed in favour of widening the boundaries of the firm as growth maximisation inefficiencies are followed)

In other words US's economic history makes a mockery of your argument

There are actually two arguments at play at the same time. You're wrong on both counts

 

I'm not a fan of the wars Rev, so absolutely these expenditures are not being used efficiently, but neither was our military. If you go to war you get in and get out as soon as possible. This did not happen for various reasons, one major reason being we became nation builders. Our wars in Iraq and Afghanistan failed almost all of Sun Tzu's basic guides. However, over the past 4 years we've drawn down our military presence and yet our deficit has been over a trillion dollars each year since Obama has been president and its going to happen again this fiscal year. How about you just give me some examples of how our trillion dollar deficit year over year is being used efficiently.

 

You didn't answer the question! Of course an important point is that government interventionism is an integral element in capitalism, given its innate instability and tendency towards crisis. The only question mark is over the source. A post-Keynesian approach, for example, will differ somewhat from a Marxist understanding. However, with you fellows we're not even at that stage. We're still in denial where you ignore the nature of capitalism because of its inconsistency with your political ideology. The subsequent 'let's pretend' is decidedly dull

 

No, thats not true at all. I've answered multiple questions. The first being that I believe Keynesian economics works to a point and we are past that point, you say that's a cliche answer. Next I ask I how efficient is our trillion dollar deficit and all you can cite is war. I say war as it has been this last decade is not an efficient use of govt funds. Then you jump to political ideology when I have stated nothing about political ideology. I ask you a question to give examples of how our trillion dollar deficit year over year is being used efficiently and you defer.

 

Its a nothing answer

Wrong again! I asked for a definition of efficiency, using Keynesian analysis to describe the inefficiency inherent in US Anglo-Saxon capitalism. You didn't answer the question because you didn't understand it

You've provided no economics. Its either political ideology or random splurge. I was being polite

You haven't got a definition of efficiency. Until you do you have nothing but political ideology (or random splurge)

 

Under-investment is always sustainable, and allows investing in multiple opportunities, discarding those that don't yield results, increasing funding on those that do.

Not only does the government over-invest, once the bureaucracy is in place, it is rarely terminated. Funding levels have nothing to do with results.

A nasty side effect of concentrated benefits, dispursed cost. But this program only costs $0.01 a day per person ($1.1B!!!).

 

No it is not a new field. The technology for solar and wind exists right now and has existed for 20 years. In the southern US, every house could be powered by solar/wind/battery. The issue for the consumer is cost. Demand is so low that cost is very very high. To install the typical house with solar/wind and a battery system for off times costs $30,000-$50,000. With maintenance and even the current cost of power from the electric utility, you will never recover the installation cost.

The problems are politics. Obama tried to force the issue instead of explain the issue. Obama is taking the top down approach which is stupid and makes enemies.

There is also the issue of control and taxation. Solar and wind power can be generated at the point of use (your home) so a distribution grid and central power generating plant are unnecessary. That removes the govt from the energy equation and they lose the tax revenue, and the ability to control your power usage.

If obama really wanted to jump start solar, he would have given a rebate/credit to everyone that installs a solar system (I don't support this type of govt intervention but obama does). Prices would come down, more people would install solar/wind. Instead the corupt obama gave 100's of millions to his campaign buddies at solyndra etc.

 

That is going to be difficult to justify given government expenditure can be understood within public good criteria (and the evidence points to how public goods are actually underprovided)

 

The comment, as I've demonstrated, was guff! You use terms such as 'overinvest' without any economic rationale behind it

 

Then just answer this question Revier. Why do we pay any taxes at all if printing money doesn't lead to inflation?

 

You've got a terribly simplistic view of inflation. There are numerous factors at play. Clearly taxes are required (particularly as it can be used to ensure equity and to encourage equality of opportunity). There is no need therefore to ask silly questions

 

Taxes have zero to do with equality of opportunity. The poorest of all pay zero tax and receive the most benefit from taxes (i.e. food stamps, welfare, Medicaid), many of which are able to work. They just don't take advantage of their opportunities. I get it, someone that is mentally or physically incapable of providing for them-self or family needs this, but that's not the case for most.

Regardless, my question is not silly just because you choose to avoid it. You have yet to answer when too much deficit is too much. Can our deficit just keep growing infinitely? You have yet to answer how social security can be saved. You have yet to answer how Medicare can be saved. You have yet to answer how jobs can be created. Your solution is to raise the minimum wage. How does that help a single business create more jobs?

According to your philosophy, Keynesian economics has no limits, so again, why do we pay taxes? Why not just print the money. People would have so much more money to spend now that they aren't paying taxes. That's an immediate boost on the economy. Print the money that schools need, print the money that the military needs, print the money that healthcare needs, print the money that the politicians need for their pay and benefits, print the money that the politicians need to pay their union employee benefits, just print it all, just give me my money tax free. Inflation of money obviously has no bearing on printed money, so print it already. Give me my money tax free, and just print the government needs. In fact, I think we should just print the nearly 16 trillion dollar deficit we are currently in and just pay it off right now.

 

Effective marginal rates of tax certainly do! Without knowing it of course, you support class divide and an attack on the economic opportunities fuelled through individualism

 

The top effective marginal rate is 18-20% that has been shown throughout US history. Anything else is just rhetorical. The rich engage in tax evasion and capital flight making anything above 20% ineffective. Even CHINA with a DEATH PENALTY for engaging capital flight can't prevent it.

 

Actually the empirical evidence points to a much higher rate (even if the context of that evidence is the Laffer Curve and a focus on how taxes impact on the black economy)

 

What about every chart that has been shown on here hundreds of times that show as marginal rates increase, revenues drop?

 

Those charts only apply to taxes which burden production and trade. A land value tax does not burden production or trade, so those charts do not apply to taxes based on land rents. Land values (land rent) can be taxed at a rate of 100% without discouraging production, investment or trade, and because of this, the tax yields more revenue the higher it is levied, all the way up to 100% of the rental value of land.

 

No such clear relationship exists. Even the standard Laffer curve analysis suggests its multi-peaked. And that analysis will also lead to a result uncomfortable for right wingers: it can be used to show that taxes should be increased

 

Except for the poorest land owners who wind up losing thier homes to the Tax man.

 

I don't trust the US Government with any more money.

 

Of course it can, the thing is that it only works when you run a balanced budget before the recession.

Pre-existing deficit + recession deficit spending = destabilized economy

Here is the fun part:

Recession + deficit reduction = Increased recession

This is known as the proverbial rock and hard place.

This is why the only real conversations about fixing the world economy is in a new Marshall Plan, where we write down the world's debt. The reason this is never discussed, is because this finally holds the bankers accountable, by etcher-sketching their profits from these transactions.


Seem print more money = Main street rape

Write down the bad debt = holding the bankers accountable.

 

That is irrelevant. The Laffer curve analysis demands higher taxes. You want to ignore right wing economic analysis just cos its inconvenient?

 

This is why I strongly believe the land value tax should have a large allowance, so those who own just a small piece of land with little value will not have to pay taxes on it.