The main assumption with Keynesian economics is that government is competent and motivated enough to maintain fiscal responsibility- by achieving surpluses in times of prosperity to fix the deficits of turbulent economic times- Putting more power at the hands of government authority is why Keynesian economics is more popular, but it takes money away from the people and ends up putting it to more waste and inefficiency
It isn't bunk. Just like any other set of economic policies, it has its situation where it's effective.
Well, well, someone who actually understands what Keynes wrote, not the BS the "progressives" like to call Keynesian economics. For those progs out there, Keynes wrote that in depressed times, the govt should cut taxes, cut regulation, and deficit spend. When the economy improves and can bear the burden of increased taxes and regulation, then the govt should increase taxes to pay off the debt. Keynes was against perpetual deficit spending. Like you wrote, Keynes is just a convenient label for the govt to gain ever more authority.
I love when people who do not understand economics post opinions about dead economists without offering any substantial arguments.
I'm not sure what progressive you are referring to that says the contrary. In my experience it is the "conservatives" who criticize Keynes on the ground that it leads to ever increasing spending, which as you point out, it does not. We've only had on real Keynesian in the last 30 years, and that was Clinton, who presided over tax increases and (relative) spending decreases, resulting in a then record deficit, proportionately bigger than ours is today, turning into a surplus. Other presidents cut taxes and spent like drunken sailors when the economy was strong, unnecessarily running up trillions of debt. Complete opposite of Keynes. The verdict is still out on Obama, who cut taxes and increased spending in the GR (consistent with Keynesian theory) and has presided over a big drop in the deficits, but hasn't had an full capacity economy. Given his pre-election comments, I'm not inclined to believe he'd properly apply Keynesian theory in a good economy, but the verdict is still out. - - - Updated - - - Under what scenario can you imagine where the Govt would not have control of its spending and revenues? It has always had this authority.
The main assumption of Keynesian economics provides a prescription that governments may apply in order to reduce the havoc of private market shenanigans in the economy while maintaining fiscal balance over the long term. Keynes himself warned that an incompetent government could, and probably would completely screw it up and all the blame would fall on him. You have proved his prediction.
Wasn't that just about the opposite of what Bush and the Republican-controlled congress did? He saw that we were in position to start paying off the debt and decided that he would rather issue tax breaks. Anyway, whatever the Bush-era economic philosophy was, we should all sign an oath to do just the opposite.
Keynes did formulate his ideas in an economy quite different than it is now. For example, computers have changed the economy in major ways. In addition, corporations are much larger than they were in Keynes day. Thus, it appears that Keynes' ideas are outdated and oversimplified compared to what we need in the modern economy we have now. Some of his ideas still work up to a point, but they are not as accurate as we need. I don't think we can be successful in the long run just blindly applying old ideas to a new and different economy. We need to rethink everything. In that rethinking, we need to get intellectually untangled temporarily from the monetary system, which is a bookkeeping system, and look at the real economy, how the real economy works, and how the real economy could work better. The real economy is the economy of real work, real production of food, manufactured products and services, the building of real factories, real solar and wind power facilities, and so forth. Then, we need to ask exactly how the real economy could be improved to provide everyone with a good standard of living. Only then do we go back and consider how to alter the monetary system, the bookkeeping system, so that it is well synchronized with the real economy we want. - - - Updated - - - Keynes did formulate his ideas in an economy quite different than it is now. For example, computers have changed the economy in major ways. In addition, corporations are much larger than they were in Keynes day. Thus, it appears that Keynes' ideas are outdated and oversimplified compared to what we need in the modern economy we have now. Some of his ideas still work up to a point, but they are not as accurate as we need. I don't think we can be successful in the long run just blindly applying old ideas to a new and different economy. We need to rethink everything. In that rethinking, we need to get intellectually untangled temporarily from the monetary system, which is a bookkeeping system, and look at the real economy, how the real economy works, and how the real economy could work better. The real economy is the economy of real work, real production of food, manufactured products and services, the building of real factories, real solar and wind power facilities, and so forth. Then, we need to ask exactly how the real economy could be improved to provide everyone with a good standard of living. Only then do we go back and consider how to alter the monetary system, the bookkeeping system, so that it is well synchronized with the real economy we want.
You have not specifically addressed any Keynesian theories in depth. I know it is cool to espouse ideological arguments online about economics. However, some of us are current students or graduates in Economics (I am the former). It takes more than debased abstracts to discredit different economic ideas.
Clinton was not a Keynesian. Under pressure of a Republican controlled Congress, spending was cut. It was a compromise. There was no surplus during the Clinton years. The federal debt increased every year Clinton was in office. Towards the end, the increases in the debt were small, but the debt still increased. Go check the data.
Not at all; it should be about manufacturing public sector means of production that generate revenue via Commerce instead of taxation.
There was never an actual spending cut, like the Tea Party induced austerity we've had over the past four years. But Clinton proved we don't have to actually cut spending to get a surplus. During his administration, spending increased, but slower than GDP growth, and thus spending fell relative to GDP. This proportionate spending decrease started when the Dems controlled Congress while Clinton was pres. it continued when the Republicans took Congress in 1995. It abruptly changed course as soon as Bush took office. So I don't see the strong basis for giving the "Republican pressure" much credit on the constrained spending during the Clinton administration. Year - Outlays - % GDP 1991 1,324.2 21.4% <- Dems controll Congress 1992 1,381.5 21.1% 1993 1,409.4 20.5% <-Clinton takes office. 1994 1,461.8 20.0% 1995 1,515.7 19.8% <-Republicans take congress. 1996 1,560.5 19.3% 1997 1,601.1 18.6% 1998 1,652.5 18.2% 1999 1,701.8 17.6% 2000 1,789.0 17.4% 2001 1,862.8 17.5% <-Bush takes office. 2002 2,010.9 18.3% 2003 2,159.9 18.8% 2004 2,292.8 18.7% 2005 2,472.0 18.9% 2006 2,655.1 19.2% You've been deceived by RW propaganda again. I didn't say anything about the federal debt. But the federal debt decreased by $114 billion in 2000.
Explain why computers and big corporations makes Keynes theories outdated. So then instead of blindly asserting Keynes' theories are outdated, think and tell us why. OK. Let's rethink it. ] What makes a "real economy" produce more? Demand for more goods and things and services being produced, right? And when the economy is suffering for lack of demand because the small percentage of folks who have most the money are hoarding it in their offshore accounts and not spending it, what can we do to increase demand?
What a load of BS. Calling spending falling relative to GDP a decrease in spending is ignorant and idiotic, and shows either a total lack of understanding of the most basic definitions or a deliberate attempt to lie and mislead. That sort of stupid obfuscation is what people in fantasy land use to make reality seem different.
You're the one who made the idiotic and ignorant statement or deliberate lie that spending was cut under Clinton. I was just trying to help you out by clarifying the truth.
Private services/goods vs. Public services/goods. Which realm tends to lead to better quality, more efficiency, and lower prices? Go.
So how else would someone compare government spending over time? Should we just count dollars and ignore inflation and economic growth? Only someone with a total lack of understanding about how money and economies can be measured and compared would be so idiotic and stupid as to attempt that sort of obfuscation in a discussion with people who have actually engaged their brains economics.
Do what all honest people do - compare year-to-year inflation adjusted dollars revenue and expenses. GDP fluctuates for all kinds of reasons, including the level of government spending. It is not an independent benchmark. What Ireamon wrote (and you seem to agree with his foolishness) was foolish.
Fox News being dishonest and foolish "U.S. Debt Reaches 100 Percent of Country's GDP" http://www.foxnews.com/politics/2011/08/04/us-debt-reaches-100-percent-countrys-gdp/ Fox News being dishonest and foolish "At its height in 2010, “discretionary spending” under Obama reached 9.1% of GDP." Read more: http://q13fox.com/2014/01/27/spending-has-fallen-under-obama-report-says/#ixzz2vt38OTKk Here's Beck being dishonest and foolish, and not just because he was lying about the figures again: The lowest was 7.7. The highest, if you see, in 1941, you might remember that date because it's supposed to live in infamy. 1941, 12 percent of GDP. Got it? http://www.politifact.com/truth-o-m...laims-obama-has-outspent-even-franklin-roose/ Forbes being Fox News being dishonest and foolish Yes, as deficits push past 80% of GDP that is cause for concern, but they’ve reached much higher levels than that. In fact, they peaked at 120% of GDP. http://www.forbes.com/2009/08/04/deficits-spending-gdp-intelligent-investing-cheney.html Heritage being dishonest and foolish Following four years of trillion-dollar deficits, the national debt will still reach nearly $17 trillion and exceed 100 percent of gross domestic product (GDP) at the end of the year http://www.heritage.org/research/reports/2013/08/federal-spending-by-the-numbers-2013 CNSNews being dishonest and foolish CNSNews.com asked Bowles at what level of Gross Domestic Product he would balance the federal budget, given that federal spending has exceeded 24 percent of GDP over the last four years - See more at: http://cnsnews.com/news/article/oba...p-1-point-higher-highest#sthash.nyJ605Ho.dpuf Cato being dishonest and foolish American Government Spending: 41% of GDP http://www.cato.org/blog/american-government-spending-41-gdp Hannity being dishonest and foolish After World War II federal spending fell from 42% of GDP to 14.8% in two years, http://www.hannity.com/article/can-we-cut-and-grow/16760 Why do you rely on dishonest and foolish sources for your information?
Great. I'm glad we got that straightened out and you aren't sticking with your ludicrous statement: "Do what all honest people do - compare year-to-year inflation adjusted dollars revenue and expenses." Since I never made such a claim, it's pretty silly of you to argue about it. I just pointed out your false claim, that's all.
