Quote: Original post by Dreddnafious Maelstrom

Quote: Original post by LessBread
The omission is not as minor as you pretend it to be. Obama spoke of business loans frequently during that speech, mentioning them nearly every time he spoke of consumer loans. Now you're engaging in misrepresentation.

Could you point to a critique that doesn't involve misrepresentation or is that impossible when you arbitrarily parse it to whatever detail you require to make the claim?

I didn't arbitrarily parse what Schiff wrote, nor what Obama said, in leveling my criticism. I also criticized Schiff for devoting nearly a dozen paragraphs to explaining the difference between credit and capital rather than providing supporting evidence for his ultimate conclusion about productive capacity. And I also found authoritative evidence that did not support his conclusion. So, yes, I could, and I actually did so long before you asked here.

Quote: Original post by Dreddnafious Maelstrom

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It makes no difference to my point. You're parroting what you've learned too.

I have a world view based off the subject, not talking points I looked up on a blog. That's the difference.

I have a world view based off the subject as well. Your "blog" attack is simply a weak attempt to dismiss my arguments even as you engage in the same effort with reference to the essay by Schiff and from the Mises Daily blog by Robert P. Murphy. Really, this line of attack is very hypocritical.

Quote: Original post by Dreddnafious Maelstrom

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Enjoy the higher taxes on your income.

Please, I can pay roughly any amount of taxes I please pending the amount I'm willing to pay my accountant. This isn't about me.

Who's the thief now? Please, I can steal from other taxpayers however much I want, depending on how much I'm willing to pay my accountant!

Quote: Original post by Dreddnafious Maelstrom

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And thus, once again you demonstrate that not only are you completely ideological, you're so wrapped up in your ideology that you can't understand how anyone could possibly think about these matters in ways outside of your ideology.

I'm not sure this qualifies as a debate, but most readers are probably scrathing their heads at some of the stuff you just don't seem to get. I don't think one has to be ideologically driven to wonder if you just have some type of mental blind spot.

In some regards it stopped qualifying as a debate when you started leveling ad hominems against me a few pages back. If they're scratching their heads, it's likely that they're wondering why I bother continuing to discuss these subjects with you.

Quote: Original post by Dreddnafious Maelstrom

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That takes the cake. Blame the other guy when you fail to substantiate your assertions.

You didn't define "cake", "substantiate", or "assertion". Quit trying to confuse the issue with all of your fancy jargon.

Hah! Funny! If that's too jargon laden for you, let me rephrase it. Instead of supporting your statements with evidence you're blaming me.

Quote: Original post by Dreddnafious Maelstrom

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I found them wanting. I found you repeating a rule (i.e. productive capacity based on margin isn't grounded by inherent demand) rather than answering the question. And, moreover, rather than show how your rule applied to the statistics from the FRB, you trotted out some contrived fable about the last days of the USSR. You were clearly avoiding the question and still are.

Less, I don't want nor am I willing to parse every item you link on the internet. I answered the "question", I didn't do your busy work.

I didn't link to some arbitrary item on the internet. I linked to the latest Federal Reserve statistics on production and utilization. It seems to me that any reasonable person would find those statistics highly relevant to discussing the "productive capacity" of the United States. I didn't ask you to do my busy work. I used them to show that Schiff's claim was not supported by the evidence.

Quote: Original post by Dreddnafious Maelstrom

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I think you were simply filibustering. I think you weren't sure just what exactly you were trying to say, so you simply piled on the words hoping that something half way coherent would emerge. Seriously, does it take a dozen paragraphs to explain that money and capital aren't necessarily the same thing? That's not on me, that's all on you.

You've demonstrated an almost remarkable ignorance of the topic. Basic, fundamental tenets that both schools of economy employ, basic terminology, basic assumptions. Yes, I did think I needed to spell out in fine detail a scenario to demonstrate my position.

I've demonstrated that I disagree with your ideological approach to the topic. You've demonstrated an almost remarkable inability to explain your views on the matter.

Quote: Original post by Dreddnafious Maelstrom

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If you want to get all moral, wrap your head around the reality that private property is murder. It robs individuals of the basics things they need to live - land, water, air. It robs individuals of their limited time on this earth. And these thefts murder body and mind. If you want to talk up what's morally reprehensible, dig deeper. Dig into the compulsion that would supplant society with the market while claiming that anything less is morally reprehensible.

I address this below in someone elses' post. You and I both know you're not a mutualist. You're too invested in the cheerleading of your left leaning political party of choice to be a radical.

Yes, you took the opportunity to try to apply a label to me once again, just as you once again stoop to using the cheerleading attack. As I've said in the past, a cheerleader would never think to pass along criticisms of their subject of praise, yet I've repeatedly pass along criticisms of Democrats and Obama.

Quote: Original post by Dreddnafious Maelstrom
Labor Theory of Value is thoroughly discredit as an economic tool. You desperately cling to some type of moral highground but the fact is that you believe that theft is moral. Your world view is predicated on forcefully taking from people. Whatever trappings and rationalizations you choose to spruce up the core tenet with is immaterial to me.

Poor John Locke, his progeny have abandoned him! I don't believe that theft is moral. I do believe that in certain situations it can be moral. Eh, Monsieur DeMasi! I believe that society takes priority over markets.

Quote: Original post by Dreddnafious Maelstrom
All semblance of civil liberties, all claims to favor the poor or protecting the weak is just window dressing. It just brutish thuggery with some critical population point that turns a thief into a mob, and then a mob into a majority. At no population point does this absolve you of the immorality.

As I wrote before, not content with replacing society with markets, you're seeking to replace thousands of years of community based morality with the morality of radical individualism. I've got mine, so long suckers!

Quote: Original post by Dreddnafious Maelstrom

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The last three decades of free market based policies have resulted in a massive wealth transfer to the top 1%. To claim that resetting national policies to those that predated such an obscene transfer of wealth, will somehow perpetuate such obscene transfer of wealth, is utterly absurd. The fact is that the rich have gotten extremely fat over the last three decades, in large part because they managed to rewrite the rules to their favor. They're not only ripe for eating, they deserve to be eaten. They didn't share the wealth with those who created it for them. It's time they pay up.

The last 3 decades have been typified by its movement toward a planned and command economy. Each step taken has punished the lower income percentiles and rewarded the wealthy. You want to move forward at a faster clip.

Now that's really far out there. Most people think that the last three decades have seen corporations take over. If there was a planned and command economy in the works, it was one where the planning and commanding would take place in corporate board rooms. At any rate, it was a planned and command economy that got the US through WWII. What makes you think it went away afterward?

Quote: Original post by Dreddnafious Maelstrom

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So you went through all that to answer a question I asked three posts back and one that you've already adequately answered? And now you're talking about internalizing verbage and avoiding sloppy usage? Please. You're filibustering.

I asked you to clarify the relationship between money and capital, not credit and capital. You responded by claiming that I was using the word "money" in nebulous fashion and that it could mean credit, capital and specie. That was a good step towards clarification, but ultimately, you undermined it by laying out what you see as the difference between credit and capital, with an explanation involving money at every step - money in the bank, money in the bank, money spent to produce, money spent to consume. You laid that all out to better argue that credit doesn't produce wealth, it merely transfers it, in your view from the poor to the rich. It seems to me that behind the argument lurks the fact that the rich hold the wealth and will say whatever they have to say to hold onto their wealth. If you take our wealth, you're not really taking it from us, you're taking it from yourself, so don't go there!

See the handholding post above. When you try to relate this to me personally, or us, because neither of us are in the lower third or likely even the lower 90 percentile of incomes I think you do me a disservice. You think my world view is based on expediency. Were that the case I'd be arguing the Republican line and chowing down at the trough.

I hold my world view because I believe it best serves man, liberally and financially, not because I can't afford an accountant.

Now that's funny. After leveling several personal attacks against me, you read that paragraph as my trying to relate this to you personally. That reveals a lot about how you perceive these discussions. From the sentence beginning with, "It seems to me" and forward, if I had wanted to relate this to you personally I would have, but that's not what I did. I used the third person, not the second person.

You claim that your views aren't based on expediency, that you sincerely believe they best serve humanity. Fair enough. Along those lines, however, why engage me with ad hominems and other abusive tactics when I'm asking you to explain your views?

Quote: Original post by LessBread
I didn't arbitrarily parse what Schiff wrote, nor what Obama said, in leveling my criticism. I also criticized Schiff for devoting nearly a dozen paragraphs to explaining the difference between credit and capital rather than providing supporting evidence for his ultimate conclusion about productive capacity. And I also found authoritative evidence that did not support his conclusion. So, yes, I could, and I actually did so long before you asked here.

Because you still don't understand the difference between credit and capital apparently. This is getting silly.

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I have a world view based off the subject as well. Your "blog" attack is simply a weak attempt to dismiss my arguments even as you engage in the same effort with reference to the essay by Schiff and from the Mises Daily blog by Robert P. Murphy. Really, this line of attack is very hypocritical.

Maybe. So your claim is that prior to the current events you had a coherent theory of capital, credit, and government policy as they relate to each other? And further that you derived this theory based on economic axioms? That's difficult to believe. Perhaps I misunderstand you.

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Who's the thief now? Please, I can steal from other taxpayers however much I want, depending on how much I'm willing to pay my accountant!

Right, I'm stealing my own money. How awful.

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In some regards it stopped qualifying as a debate when you started leveling ad hominems against me a few pages back. If they're scratching their heads, it's likely that they're wondering why I bother continuing to discuss these subjects with you.

It never qualified as a debate because we never established a premise we both could agree to. That's always a shortcoming when we talk, however threads where we share a common premise tend to be shorter and less interesting.

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Hah! Funny! If that's too jargon laden for you, let me rephrase it. Instead of supporting your statements with evidence you're blaming me.

I accept full responsibility for being unable to communicate ideas to you effectively on this issue. As I stated, you have amazed me with your ability to not grok the obvious.
.

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Yes, you took the opportunity to try to apply a label to me once again, just as you once again stoop to using the cheerleading attack. As I've said in the past, a cheerleader would never think to pass along criticisms of their subject of praise, yet I've repeatedly pass along criticisms of Democrats and Obama.

I actually stated what you're not, not what you are. I must have missed your repeated criticisms of Obama and the Dems. Did you catch Greenwalds last article relating to executive power and Obama?

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Poor John Locke, his progeny have abandoned him! I don't believe that theft is moral. I do believe that in certain situations it can be moral. Eh, Monsieur DeMasi! I believe that society takes priority over markets.

You believe in a fiction that a collection of people are superior to an individual. When in fact a collection of people are simply a number of individuals.

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As I wrote before, not content with replacing society with markets, you're seeking to replace thousands of years of community based morality with the morality of radical individualism. I've got mine, so long suckers!

I'll accept that as tacit admission that yes, you do condone thievery, and feel, like Stalin, that the ends justify the means.

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Now that's really far out there. Most people think that the last three decades have seen corporations take over. If there was a planned and command economy in the works, it was one where the planning and commanding would take place in corporate board rooms. At any rate, it was a planned and command economy that got the US through WWII. What makes you think it went away afterward?

So which is it? We're not moving towards a command economy, or we are and you think it's superior?

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Now that's funny. After leveling several personal attacks against me, you read that paragraph as my trying to relate this to you personally. That reveals a lot about how you perceive these discussions. From the sentence beginning with, "It seems to me" and forward, if I had wanted to relate this to you personally I would have, but that's not what I did. I used the third person, not the second person.

You claim that your views aren't based on expediency, that you sincerely believe they best serve humanity. Fair enough. Along those lines, however, why engage me with ad hominems and other abusive tactics when I'm asking you to explain your views?

It is often times frustrating to see you fall back on your "the wealthy are evil" illogic. So any point I make you have your default,

Quote: "It seems to me that behind the argument lurks the fact that the rich hold the wealth and will say whatever they have to say to hold onto their wealth.

So you don't actually have to rely on reason, you can simply attribute your preconceived motive and move on.

Quote: Original post by Dreddnafious Maelstrom
Thank you for the thoughtful post. We do both agree that some change is required certainly. Less is arguing for a better managed monopoly, im arguing
for demonopolization, or as near as we can come to it.

If by monopoly you mean the state, yes, I'm arguing for a better managed state.

Quote: Original post by Dreddnafious Maelstrom
Less's solution is regulation, and tax theft to effect equal outcome.

The equal outcome mischaracterization is old and tired.

Quote: Original post by Dreddnafious Maelstrom
What makes the government more responsive or more competent to provide relief or services than several million individuals working toward that end? And if they possess this remarkable competency why then do charity and relief organizations exist?

The government can respond more rapidly to crisis than several million individuals working together. Charity and relief organizations exist because governments don't respond to every possible crisis.

Quote: Original post by Dreddnafious Maelstrom
Without competition there is no expectation of competance.

Even with competition, there's no guarantee of competence. The expectation of competence is a projection based on the assumption that competition produces winners.

Quote: Original post by Dreddnafious Maelstrom
Respectfully, the concept of spontaneous order is the predicate for much of Mises' philosophy. That ABCT deals with individual actors as a base doesn't diminish it. As an example, where Keynesianism fails to model the possibility of stagflation, ABCT accounts for it flawlessly. This example is important because it demonstrates the viability of ABCT in the aggregate.

There are some things to learn from ABCT that probably should be applied. Kondratiev waves are also interesting, it seem to be a winter phase going on.

Quote: Original post by Dreddnafious Maelstrom
So your premise is that human action breaks down at some critical population point?8

Not as such. I mean that at some critical point the sum of the actions form a feedback system that acts in addition to the individual actions. Since this feedback system is most likely chaotic, it becomes difficult to predict its effects. It could directly alter the decisions individual people will make or the outcome of those decisions.

Quote: Original post by Dreddnafious Maelstrom
It seems you are addressing this from a utilitarian standpoint. That is, "Whatever works best". The problem with being a utilitarian is that what works best for the collective may or may not work best for the individual.

Somewhat utilitarian, true. But I guess so could be argued about your position also. There is an interesting twist here that my background is a highly organised Nordic society. We have unions and systems probably for everything. Since we are only five million people and I truly believe almost everything can be changed rather quickly. At some level this becomes individuals bargaining on news papers and Internet forums about opinions (petitions are very popular and this is not unique to Finland in Europe).

A case example: Last week our prime minister unilaterally decided the base retirement age is raised (our system functions differentely than that of the U.S.). This caused an enormous out cry no one alone can just decide on a common matter. Different workers unions called their local representatives to Finlandia hall to a general assembly after consulting their local work places. The prime minister has been forced to negotiate on common will.

This is one form of checking government power. It could be argued that it wouldn't be needed if the government was minimalist. On the other hand, it could be argued that we need a government so we can react quickly. Against the government there are different groups applying checks and pressure.

Also, the common will isn't necessarily the best for all. Currently everyone can work basically as long as they are able to. Retiring earlier than the base age lessens the granted pension. Yes, a basic pension depending on the salary of one's whole working life is guaranteed. Above that one could have individual savings also.

My point being that there is a change in the modern complex world societies would form lobby groups since sooner or later the individuals would consider someone or some other group would screw them or they need to muster resources for some collective effort. For some reason or another, corporations aren't always deemed the best possibe option to muster these resources.

Quote: Original post by Dreddnafious Maelstrom
There is no such thing as collective rights, except those litigated into existence. For rights to be meaningful each individual must possess the full scope of rights and then whether it is one or 100 million their rights are protected.

I see your point.

Quote: Original post by Dreddnafious Maelstrom
When you form a pronoun, and grant them rights that the indivdual components do not possess then you necessarily deprive other individuals of their rights.

So I believe in minority rights, and recognize that the individual is always the minority.

You are right in this, of course. And my examples on forming a society are simplified ones. It could be even argued that my examples have been proven to be invalid as stated in the 19th century in several theories as there aren't in fact contracts between individuals.

Then the crux of the matter would be contract theories. Like consequentialism and (its derivative) utilitarianism . In which way societies build or deconstruct themselves will affect the economic models also. From this thread it seem to be me that you argue more from the viewpoint of "market theory" ignoring society and contract theories and LessBread is arguing more on the view point of societies.

Quote: Original post by Dreddnafious Maelstrom
This is a point that Less and I actually agree on. We don't debate it because it quickly becomes an echo chamber.We both agree that the existing system allows the wealthy to infringe on the rights of the destitute. We disagree on how to effect the changes needed to keep this from happening.

Less's solution is regulation, and tax theft to effect equal outcome. My solution is to insure that each individual has a full suite of rights that protect them from predation. My issue with Less's solution is that the problems we currently have are largely caused by lesser implementations of his proposed solution. He wants better management. I want demonopolization.

I see.

Quote: Original post by Dreddnafious Maelstrom
Let me point out that I don't deem democracy as the highest form of government, it is simply the best we've found thus far. That same mob that joins together to fund a catastophic relief fund could as well vote for selling the organs of the victims. There is nothing inherently moral in democracy, it is mob rule.

Mob rule is also the correct term for reprobate polity. To me it seems that your basic view of individual conforms with the idea of polity (*).

Quote: Original post by Dreddnafious Maelstrom
No high morale or lofty speech can make taking from one man to give to another against his will anything more than theft. The intention does not come in to play. That said, willingly entering into such an arrangment IS lofty, and does denote a high moral standing.

Polity (*).

(*) This term is nebulous. Taking Wikipedia as an example, it is rather different in Finnish and English language entries. To sum it shortly, a polity is a rule of free individuals where they decide on common matters by assembling to town squares. A decision is reached when it is agreed on. An individual can also cede rights to freely decide on future assemblies.

Quote: Original post by Dreddnafious Maelstrom
I have no problem with philanthropy. I am guilty of it myself. But when you rob people of the fruit of their labor you also rob from them their will and means to give to others. Why give to charity when the government has already taken "your part"?

Perhaps earmarking taxes would be a worthy idea. Everyone has to give a certain amount, but they can decide the target for, say, 50% of their taxes.

Quote: Original post by Dreddnafious Maelstrom
What makes the government more responsive or more competent to provide relief or services than several million individuals working toward that end? And if they possess this remarkable competency why then do charity and relief organizations exist?

The good idea is that someone competent is doing it so that not everyone has to think about it. Perhaps this shows low character of people. Or they confess their limited abilities to follow everything even if they mean well (good intentions, the root of all evil).

Quote: Original post by Dreddnafious Maelstrom
One can not make this assumption reasonably because government is a monopoly. There's only one over a given geography and it tolerates no competition. Without competition there is no expectation of competance.

The above mentioned contract theories handles this issue thoroughly.

1) In state of anarchy the individuals cannot tell which members of the society are aggressive.

2) It's bad to become suprised and deprived.

It follows that individuals' best bet is to assumme other individuals are aggressive and not to become surprised and it is better to take others by surprise. However, this is a difficult situation and some forms of societies will be born. Say, a mini-minarchist state. Should these states allow other such entities to form in their area of rule? That would mean they could not enforce the rule of the society in their area.

They could allow individuals migrating to other societies. But then, can they allow the other socities to apply their rules to their area? At which point there is a society and at which point anarchy? These are difficult questions (I'm not sure if Wikipedia contains information on these matters).

Quote: Original post by Dreddnafious Maelstrom
You say, "voluntarily or just chugging along" which hides the fact that there really was no such decision to be made. Your government claims sovereignty over its land. Thus, any land you presume to own you actually have a lease on. At any point the government can take your land and claim imminent domain. It further exercises control over how you can dispose of your proerty and what you can do on your property.

Finnish government has the monopoly to use of violence. Some reasons being that the general population is unwilling to tolerate mafia, armed thug gangs or any kind of clan rule on this area and is willing to enfore the Finnish laws by force if necessary.

The property rights in Finland are almost sacred. I'd be willing to say the U.S. is much more loose in this regard. Current cry is that everyone can acquire land in vicinity of important pieces of land, like army communications installations. Even foreigners. Then we have also freedom to roam (that entry on Finland isn't too exact, but passable).

Also seen from here, the individual rights on privacy and to protect onself against legal predation (as defined in laws) in the U.S. are inadequate.

Quote: Original post by Dreddnafious Maelstrom
Note that the will of the collective and the will of the individual can vary greatly. Just ask the Borg.

True. I tried to demonstrate it with my few examples of actual implementations of a less restricted form of free will.

Quote: Original post by Dreddnafious Maelstrom
The issue is that the concept of collective freedom and individual freedom is incompatible. An individual with a full suite of rights scales to any number of people. A collective with collective rights doesn;t parse down to the individual.

You are uncompromising. It's not wrong. My own standing is "in which degree", not yes-no.

Quote: Original post by Dreddnafious Maelstrom
I think Less is engaging in more of a tit for tat. I point out fundamental inconsistencies in his philosophy and he says, "No you" I do enjoy debating him though, it helps me sharpen my philosophy, and occasionally I learn something from him.

That is really difficult to tell, language and culture barrier being one factor. I don't want to start a dispute on this, but there are valid reasons why Austrian business school theories are't that succesful in public square. To me it seem to be that they assume some things but explain inadequately what other theories explain will follow from these assumptions. On the other hand, many theories of socities disregard theories of economics.

And what I actually try to tell is that, now since you are wondering if people are scratching their heads [smile], is that it looks like there is an ideological divide and this long thread starts to become a waste of time to everyone involved and a truce and a study break before the next clash would be the most appropriate action. [smile]

Quote: Original post by Dreddnafious Maelstrom

Quote: Original post by LessBread
I didn't arbitrarily parse what Schiff wrote, nor what Obama said, in leveling my criticism. I also criticized Schiff for devoting nearly a dozen paragraphs to explaining the difference between credit and capital rather than providing supporting evidence for his ultimate conclusion about productive capacity. And I also found authoritative evidence that did not support his conclusion. So, yes, I could, and I actually did so long before you asked here.

Because you still don't understand the difference between credit and capital apparently. This is getting silly.

It's getting bizarre actually. You seem to be answering a question I did not ask.

Quote: Original post by Dreddnafious Maelstrom

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I have a world view based off the subject as well. Your "blog" attack is simply a weak attempt to dismiss my arguments even as you engage in the same effort with reference to the essay by Schiff and from the Mises Daily blog by Robert P. Murphy. Really, this line of attack is very hypocritical.

Maybe. So your claim is that prior to the current events you had a coherent theory of capital, credit, and government policy as they relate to each other? And further that you derived this theory based on economic axioms? That's difficult to believe. Perhaps I misunderstand you.

That's not my claim. I have a world view on economics and government policy. I don't give priority to economic axioms, so I don't get lost in the thickets of theories about capital and credit. I approach these subjects from a political perspective, not a business perspective. What you see as economic axioms, I see as ideological precepts, especially when they are presented without reference to facts. I read a lot. I don't link to everything I read. My world view informs how I filter out good from bad commentary and what I share with others. That said, I don't always agree with everything written in links I pass along.

Quote: Original post by Dreddnafious Maelstrom

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Who's the thief now? Please, I can steal from other taxpayers however much I want, depending on how much I'm willing to pay my accountant!

Right, I'm stealing my own money. How awful.

No. In dodging taxes, you're stealing from other taxpayers who are having to pay more to pay for the government services you're using.

Quote: Original post by Dreddnafious Maelstrom
That's always a shortcoming when we talk, however threads where we share a common premise tend to be shorter and less interesting.

Lol. That's true! Mith's recent drug thread for example.

Quote: Original post by Dreddnafious Maelstrom
I accept full responsibility for being unable to communicate ideas to you effectively on this issue. As I stated, you have amazed me with your ability to not grok the obvious.

It's not an inability to grasp the obvious, it's a refusal to fill in the gaps in your ideas. I'd rather you clarify the assumptions in your statements than supply my own and get what you're saying wrong.

Quote: Original post by Dreddnafious Maelstrom

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Yes, you took the opportunity to try to apply a label to me once again, just as you once again stoop to using the cheerleading attack. As I've said in the past, a cheerleader would never think to pass along criticisms of their subject of praise, yet I've repeatedly pass along criticisms of Democrats and Obama.

I actually stated what you're not, not what you are. I must have missed your repeated criticisms of Obama and the Dems. Did you catch Greenwalds last article relating to executive power and Obama?

You went off on that cheerleading jag again, quote, "You're too invested in the cheerleading of your left leaning political party of choice to be a radical." Yes, you missed the criticism of Obama in the long snippet from the interview with John Bellamy Foster that I cited above ("Meanwhile, under Obama's watch, and with the help of his chosen advisers, vast amounts of state funds are being infused into the financial system to benefit private capital.") Yes, I read Greenwald regularly. As usual, he's right on target. Imo, Obama should dismantle the unitary executive rather than embrace and extend it. Relying on the "goodwill" of the executive is an insufficient protection against tyranny.

Quote: Original post by Dreddnafious Maelstrom

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Poor John Locke, his progeny have abandoned him! I don't believe that theft is moral. I do believe that in certain situations it can be moral. Eh, Monsieur DeMasi! I believe that society takes priority over markets.

You believe in a fiction that a collection of people are superior to an individual. When in fact a collection of people are simply a number of individuals.

And you believe in the fiction that labor, land and money are commodities. Ultimately, everyone believes in a fiction one way or the other. The solidity of objects for example. The solidity of a baseball seems quite obvious when it's hurling towards you at 90 mph, yet science teaches us that the volume of space occupied by an atom is mostly empty. It's paradoxical, but in order to live we have to accept one fiction or another. Getting back to your remark, you seem to believe that individuals spring into existence fully mature and ready to enter the market. The reality is that you can't have an individual without the collective, just as you can't have the collective without individuals. When you phrase things as a matter of superiority (without stipulating a scale), you open yourself up to simple mathematical refutation. If the individual is superior, then two individuals are twice as superior and so on until ultimately the collective is collectively superior to the individual. Asserting the superiority of the individual leads to clashes between individuals and between individuals and the collective. Ultimately this is self defeating. The mutual dependence between the individual and the collective means that both have to respect each other if either is going to thrive.

Quote: Original post by Dreddnafious Maelstrom

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As I wrote before, not content with replacing society with markets, you're seeking to replace thousands of years of community based morality with the morality of radical individualism. I've got mine, so long suckers!

I'll accept that as tacit admission that yes, you do condone thievery, and feel, like Stalin, that the ends justify the means.

Then you're accepting a fiction of your own making. I disagree with your premise that taxes are theft. I don't condone thievery under ordinary conditions, but if a person steals a loaf of bread to feed a starving child I'll be more angry with the fact that the child was starving in the first place than I will be with the person who stole the bread. Now, you might take that as an admission that the end justifies the means, but that would amount to stretching the scenario into absurdity. Some ends justify some means, but not any means and not in every case.

Quote: Original post by Dreddnafious Maelstrom

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Now that's really far out there. Most people think that the last three decades have seen corporations take over. If there was a planned and command economy in the works, it was one where the planning and commanding would take place in corporate board rooms. At any rate, it was a planned and command economy that got the US through WWII. What makes you think it went away afterward?

So which is it? We're not moving towards a command economy, or we are and you think it's superior?

I'm suggesting that we're not moving towards what in large part we've been living in since 1942. If you think that pointing that out means that I think it's superior, that's on you. (You really have a thing for superiority today don't you?) Imo, economic planning can play a positive role in society, but it's not the end all be all. It's not the total answer.

Quote: Original post by Dreddnafious Maelstrom

Quote:
Now that's funny. After leveling several personal attacks against me, you read that paragraph as my trying to relate this to you personally. That reveals a lot about how you perceive these discussions. From the sentence beginning with, "It seems to me" and forward, if I had wanted to relate this to you personally I would have, but that's not what I did. I used the third person, not the second person.

You claim that your views aren't based on expediency, that you sincerely believe they best serve humanity. Fair enough. Along those lines, however, why engage me with ad hominems and other abusive tactics when I'm asking you to explain your views?

It is often times frustrating to see you fall back on your "the wealthy are evil" illogic. So any point I make you have your default,

Quote: "It seems to me that behind the argument lurks the fact that the rich hold the wealth and will say whatever they have to say to hold onto their wealth.

So you don't actually have to rely on reason, you can simply attribute your preconceived motive and move on.

Do you really think it's outlandish to say that the rich want to hold onto their wealth? It seems to me that, other than people preparing to enter into religious orders, everyone wants to hold onto their wealth and will do what they can to that end. It's almost ironic that you would deem that motive to be evil and claim that pointing it out amounts to illogic.

Quote: Original post by Lessbread
It's getting bizarre actually. You seem to be answering a question I did not ask.

I understand. My point was that once you understand the difference between credit and capital you understand Shiff's critique. That you choose not to apply it is likely the source of our disagreement.

Quote:
That's not my claim. I have a world view on economics and government policy. I don't give priority to economic axioms, so I don't get lost in the thickets of theories about capital and credit. I approach these subjects from a political perspective, not a business perspective. What you see as economic axioms, I see as ideological precepts, especially when they are presented without reference to facts. I read a lot. I don't link to everything I read. My world view informs how I filter out good from bad commentary and what I share with others. That said, I don't always agree with everything written in links I pass along.

Fair enough, although, I wonder why you took offense to me pointing out that your economics were ideological blinders when you admit as much here?

Quote:
No. In dodging taxes, you're stealing from other taxpayers who are having to pay more to pay for the government services you're using.

It takes quite a contortion to make me a thief when it's my money involved. One of many required to believe as you do.

Quote:
You went off on that cheerleading jag again, quote, "You're too invested in the cheerleading of your left leaning political party of choice to be a radical." Yes, you missed the criticism of Obama in the long snippet from the interview with John Bellamy Foster that I cited above ("Meanwhile, under Obama's watch, and with the help of his chosen advisers, vast amounts of state funds are being infused into the financial system to benefit private capital.") Yes, I read Greenwald regularly. As usual, he's right on target. Imo, Obama should dismantle the unitary executive rather than embrace and extend it. Relying on the "goodwill" of the executive is an insufficient protection against tyranny.

I'm much impressed with Greenwald and have been for some time. It's not getting any press, nor should it probably, but there's quite a nice little internal squabble going on in the Democratic party about radical and rationals, the delineation being those that hold to principle and those that blindly endorse Obama.

It's interesting because it reminds me of GW and the Republicans. The "rationals" won out in the Repub party and squashed them pretty bad. I'm rooting for the radicals in the Democratic party now, Greenwald and Maddow specifically.

Quote:
And you believe in the fiction that labor, land and money are commodities. Ultimately, everyone believes in a fiction one way or the other. The solidity of objects for example. The solidity of a baseball seems quite obvious when it's hurling towards you at 90 mph, yet science teaches us that the volume of space occupied by an atom is mostly empty. It's paradoxical, but in order to live we have to accept one fiction or another. Getting back to your remark, you seem to believe that individuals spring into existence fully mature and ready to enter the market. The reality is that you can't have an individual without the collective, just as you can't have the collective without individuals. When you phrase things as a matter of superiority (without stipulating a scale), you open yourself up to simple mathematical refutation. If the individual is superior, then two individuals are twice as superior and so on until ultimately the collective is collectively superior to the individual. Asserting the superiority of the individual leads to clashes between individuals and between individuals and the collective. Ultimately this is self defeating. The mutual dependence between the individual and the collective means that both have to respect each other if either is going to thrive.

Just a quick note. You state that the individual doesn't exist without the collective. I'm not sure you meant to say that as it is prima facie not true.

Quote:
I'm suggesting that we're not moving towards what in large part we've been living in since 1942. If you think that pointing that out means that I think it's superior, that's on you. (You really have a thing for superiority today don't you?) Imo, economic planning can play a positive role in society, but it's not the end all be all. It's not the total answer.

Yeah superior must be the adjective of the day for me subconsciously. I'm not sure I understand your point. Can you state more clearly whether you think we're moving towards a planned economy and whether you think a planned economy is superior(hmmm, this post sponsored by the word superior i guess) to a market based economy?

Also, there is a much celebrated idea in progressive circles that the countrty is slowly becoming more progressive. Does this square with your answer about planned economies or do you disagree with this idea?

Quote:
Do you really think it's outlandish to say that the rich want to hold onto their wealth? It seems to me that, other than people preparing to enter into religious orders, everyone wants to hold onto their wealth and will do what they can to that end. It's almost ironic that you would deem that motive to be evil and claim that pointing it out amounts to illogic.

No, it's not unreasonable as a presumption. I just think it is unreasonable to dismiss a philosophy based on your proscribed motive. If I answered every progressive statement you made with, "because you conflate God and Government" it would'nt add much to the conversation, but that's at the heart of your philosophy. The belief that 1+1+1 = 7000.(Or more accurately, some number that we've never heard of that acts as both a prime number, a real number, a repeating decimal, and the square root of pi, so long as its greater than 3)

I read an interesting article today from Tom Woods Jr. What struck me about it is his explanation on credit vs capital is very similar to my own.(We subscribe to the same school of economic thought). I wanted to take another crack at two issues we were discussing. One is my point about "parroting" versus describing a given economic philosophy. Note that this article was published after my very similar explanation. The other was in describing how understanding the difference between credit and capital invalidates Obama's approach, and further validates Schiff's critique. It also tackles nicely your table regarding productive capacity. Perhaps given the source his explanation will be considered more lucid.


Link to article


A few excerpts that I feel are most pertinent regarding the topics I outlined.

Quote: No one is surprised when a business has to close. Entrepreneurs may have miscalculated costs of production, failed to anticipate patterns of consumer tastes, or underestimated resources necessary to comply with ever-changing government regulation. But when many businesses have to close at once, that should surprise us. The market gradually weeds out those who do a poor job as stewards of capital and forecasters of demand. So why should businessmen, even those who have passed the market test year after year, suddenly all make the same kind of error?

Economist Lionel Robbins argued that this “cluster of errors” demanded an explanation: “Why should the leaders of business in the various industries producing producers’ goods make errors of judgment at the same time and in the same direction?” We call this pattern of apparent prosperity followed by general depression the business cycle, the trade cycle, or the boom-bust cycle. Does it have a cause, or is it, as Marx argued, an inherent feature of the market economy?

F.A. Hayek won the Nobel Prize in economics for a theory of the business cycle that holds great explanatory power—especially in light of the current financial crisis, which so many economists have been at a loss to explain. Hayek’s work, which builds on a theory developed by Ludwig von Mises, finds the root of the boom-bust cycle in the central bank—in our case the Federal Reserve System, the very institution that postures as the protector of the economy and the source of relief from business cycles.

Quote: In particular, the culprit turns out to be the central bank’s interference with interest rates. Interest rates are like a price. Lending capital is a good, and you pay a price to borrow it. When you put money in a savings account or buy a bond, you are the lender, and the interest rate you earn is the price you are paid for your money.

As with all goods, the supply and demand for lending capital determines the price. If more families are saving or more banks are lending, borrowers don’t have to pay as much to borrow, and interest rates go down. If there’s a rush to borrow or a dearth of lending capital, interest rates go up.

There are some results of this dynamic that contribute to a healthy economy. Start with the case where people are saving more, thus increasing the supply of lending capital and lowering interest rates. Businesses respond by engaging in projects aimed at increasing their productive capacity in the future—expanding facilities or acquiring new capital equipment.

Also consider the saver’s perspective. Saving indicates a lower desire to consume in the present. This is another incentive for businesses to invest in the future rather than produce and sell things now. On the other hand, if people possess an intense desire to consume right now, they will save less, making it less affordable for businesses to carry out long-term projects. But the big supply of consumer dollars makes it a good time to produce and sell.

Thus the interest rate coordinates production across time. It ensures a compatible mix of market forces: if people want to consume now, businesses respond accordingly; if people want to consume in the future, businesses allocate resources to satisfy that desire. The interest rate can perform this coordinating function only if it is allowed to move freely in response to changes in supply and demand. If the Fed manipulates the interest rate, we should not be surprised by discoordination on a massive scale.

But suppose the Fed lowers rates so that they no longer reflect the true state of consumer demand and economic conditions. Artificially low interest rates mislead investors into thinking that now is a good time to invest in long-term projects. But the public has indicated no intention to postpone consumption and free up resources that firms can devote to those developments. On the contrary, the lower interest rates encourage them to save less and consume more. So even if some of these projects can be finished, with the public’s saving relatively low, the necessary purchasing power won’t be around later, when businesses hope to cash in on their investments.

And as a company works toward completing its projects under these conditions, it will find that the resources it needs—labor, materials, replacement parts—are not available in sufficient quantities. The prices will therefore be higher, and firms will need to borrow to finance these unanticipated increases in input prices. This increased demand for borrowing will raise the interest rate. Reality now begins to set in: some of these projects cannot be completed.

Moreover, the kind of projects that are started differ from those that would have been started on the free market. Mises draws an analogy between an economy under the influence of artificially low interest rates and a homebuilder who believes he has more resources—more bricks, say—than he really does. He will build a house much different than he would have chosen if he had known his true supply of bricks. But he will not be able to complete this larger house, so the sooner he discovers his true brick supply the better, for then he can adjust his production plans before too many of his resources are squandered. If he only finds out in the final stages, he will have to destroy everything but the foundation, and will be poorer for his malinvestment.

In the short run, the result of the central bank’s lowering of interest rates is the apparent prosperity of the boom period. Stocks and real estate shoot up. New construction is everywhere, businesses are expanding, people are enjoying a high standard of living. But the economy is on a sugar high, and reality inevitably sets in. Some of these investments will prove unsustainable.

Quote: Although painful, the recession or depression phase of the cycle is not where the damage is done. The bust is the period in which the economy sloughs off the capital misallocation, re-establishes the structure of production along sustainable lines, and restores itself to health. The damage is done during the boom phase, the period of false prosperity. It is then that the artificial lowering of interest rates causes the misdirection of capital and the initiation of unsustainable investments. It is then that resources that would genuinely have satisfied consumer demand are diverted into projects that make sense only in light of artificial conditions. For the mistaken bricklayer, the damage wasn’t done when he tore down the large house he couldn’t complete; the damage was done when he laid the bricks too broadly.

Investment adviser Peter Schiff draws an analogy between an artificial boom and a circus that comes to town for a few weeks. When the circus arrives, its performers and the crowds it attracts patronize local businesses. Now suppose a restaurant owner mistakenly concludes that this boom will endure and responds by building an addition. As soon as the circus leaves town, he finds he has tragically miscalculated.

Does it make sense to inflate this poor businessman’s way out of his predicament? Creating new money doesn’t create any new stuff, so lending him newly created money merely allows him to draw more of the economy’s resource pool to himself, at the expense of genuine businesses that cater to real consumer wishes. This restaurant is a bubble activity that can survive only under the phony conditions of the circus boom. It needs to come to an end so that the resources it employs can be reallocated to more sensible lines of production.

Quote: There will always be those who, not understanding the situation, will call for more and greater monetary injections to try to keep the boom going, and their number has skyrocketed since the fall of 2008. In mid-December, the Fed set its federal-funds target at 0 to 0.25 percent, the Keynesian dream. Blinded by the same folly, Bank of England governor Mervyn King said he was ready to reduce rates to “whatever level is necessary,” including as low as zero—a move sure to perpetuate the misallocations of the boom and set the state for a far worse crisis.

Keynesian “pump priming,” whereby governments fund public-works projects, often financed by deficits, are another destructive if inexplicably fashionable course of action, based on the modern superstition that the very act of spending is the path to economic health. Take from the economy as a whole and pour resources into particular sectors: that should make us rich! Economic historian Robert Higgs compared plans like these to taking water from the deep end of a pool, pouring it into the shallow end, and expecting the water level to rise.

Additional public-works spending not only deprives the private sector of resources by taxing people to support these projects, it diverts resources toward firms that may need to be liquidated and drives up interest rates if the projects are funded by government borrowing, thereby making bank credit tighter for private firms. These projects are the very opposite of what the fragile bust economy calls for. It needs to shift resources swiftly into the production of goods in line with consumer demand, with as little resource waste as possible. Government, on the other hand, has no way of knowing how much of something to produce, using what materials and production methods. Private firms use a profit-and-loss test to gauge how well they are meeting consumer needs. If they make profits, the market has ratified their production decisions. If they post losses, they have squandered resources that could have been more effectively employed on behalf of consumer welfare elsewhere in the economy. Government has no such feedback mechanism since it acquires its resources not through voluntary means but through seizure from the citizens, and no one can choose not to buy what it produces. These projects squander wealth at a time of falling living standards and a need for the greatest possible efficiency with existing resources.

Neither can the state seem to resist the temptation to extend emergency credit to failing businesses. If their positions were sound, credit would be forthcoming from the private sector. If not, then they should go out of business, freeing up resources to be used by more capable stewards. Diverting resources from those who have successfully met consumer demands to those who have not serves only to weaken the economy and make recovery that much more difficult.

Probably should just read the article, I ended up quoting most of it.

Quote: Original post by Dreddnafious Maelstrom

Quote: Original post by Lessbread
It's getting bizarre actually. You seem to be answering a question I did not ask.

I understand. My point was that once you understand the difference between credit and capital you understand Shiff's critique. That you choose not to apply it is likely the source of our disagreement.

Looking over his essay and Obama's speech again, I don't think that's the issue, at least, not entirely. It looks to me that Schiff mixes up Obama's short term prescription for the economy with a long term outlook. Yes, Obama wants to restore the flow of credit in the economy, but Schiff portrays that as all Obama wants to do, when what Obama said was that "The recovery plan and the financial stability plan are the immediate steps we’re taking to revive our economy in the short-term." The later portions of the speech focus on various long-term efforts - renewable energy, basic research, updating the electrical grid, health care reform, education reform - as well as deficit reduction. It's also odd that Schiff would criticize Obama for not focusing on "rebuilding productive capacity or increasing savings" when it would seem that an economist with Libertarian inclinations would think those endeavors belong in the private sector. Obama seems to get that: "In each case, government didn’t supplant private enterprise; it catalyzed private enterprise. It created the conditions for thousands of entrepreneurs and new businesses to adapt and to thrive." Sure, Obama could have used the bully pulpit to call on the private sector to "get back to the basics of production" as Schiff put it, but I think it was far more important for Obama to lay out for the public what he intends to have the government do. Directing the government is his job after all.

It looks like Schiff was more interested in presenting his picture of how an economy works than in responding to what Obama actually proposed in his speech.

Quote: Original post by Dreddnafious Maelstrom

Quote:
That's not my claim. I have a world view on economics and government policy. I don't give priority to economic axioms, so I don't get lost in the thickets of theories about capital and credit. I approach these subjects from a political perspective, not a business perspective. What you see as economic axioms, I see as ideological precepts, especially when they are presented without reference to facts. I read a lot. I don't link to everything I read. My world view informs how I filter out good from bad commentary and what I share with others. That said, I don't always agree with everything written in links I pass along.

Fair enough, although, I wonder why you took offense to me pointing out that your economics were ideological blinders when you admit as much here?

I took offense at you singling me out for a fault that you yourself share (as does practically everyone else).

Quote: Original post by Dreddnafious Maelstrom

Quote:
No. In dodging taxes, you're stealing from other taxpayers who are having to pay more to pay for the government services you're using.

It takes quite a contortion to make me a thief when it's my money involved. One of many required to believe as you do.

If you're using government services that other taxpayers paid for, then your money isn't involved is it? No contortions are needed. On the other hand, to believe as you do requires entertaining the fiction that all men are islands (to paraphrase John Donne).

Quote: Original post by Dreddnafious Maelstrom

Quote:
You went off on that cheerleading jag again, quote, "You're too invested in the cheerleading of your left leaning political party of choice to be a radical." Yes, you missed the criticism of Obama in the long snippet from the interview with John Bellamy Foster that I cited above ("Meanwhile, under Obama's watch, and with the help of his chosen advisers, vast amounts of state funds are being infused into the financial system to benefit private capital.") Yes, I read Greenwald regularly. As usual, he's right on target. Imo, Obama should dismantle the unitary executive rather than embrace and extend it. Relying on the "goodwill" of the executive is an insufficient protection against tyranny.

I'm much impressed with Greenwald and have been for some time. It's not getting any press, nor should it probably, but there's quite a nice little internal squabble going on in the Democratic party about radical and rationals, the delineation being those that hold to principle and those that blindly endorse Obama.

It's interesting because it reminds me of GW and the Republicans. The "rationals" won out in the Repub party and squashed them pretty bad. I'm rooting for the radicals in the Democratic party now, Greenwald and Maddow specifically.

Greenwald is a sharp thinker. I'm not familiar with the squabble you speak of, except as related by Greenwald and others. Maybe that's because I don't see it as a new development but as a long standing tension between the corporatists and the populists (or the "democratic wing of the Democratic party" as Howard Dean put it). For me at least, that squabble has been going on since 1992 when Jerry Brown ran for President as a populist against Clinton the corporatist. I worked on Jerry's campaign. He's changed a lot since then, but he's always been a chameleon. This also gets at why I get irked when you call me a cheerleader for the Democrats. I don't have much praise for Clinton and never have. I've always found him too corporatist, too power hungry, too willing to compromise (that's not to say that I'm opposed to compromise). I was disappointed with Obama for picking so many Clinton retreads for his cabinet. I mean Larry Summers? Come on! And then to pack the stimulus bill with compromises upfront rather than haggled out later as concessions? I didn't think that was smart.

Greenwald and Maddow aren't really in the Democratic Party. They're probably registered to vote as Democrats, but they're not "in the party" in a meaningful sense. Greenwald has to effect change from outside the party proper. Donna Brazile, Paul Begala - they're in the party.

Quote: Original post by Dreddnafious Maelstrom

Quote:
And you believe in the fiction that labor, land and money are commodities. Ultimately, everyone believes in a fiction one way or the other. The solidity of objects for example. The solidity of a baseball seems quite obvious when it's hurling towards you at 90 mph, yet science teaches us that the volume of space occupied by an atom is mostly empty. It's paradoxical, but in order to live we have to accept one fiction or another. Getting back to your remark, you seem to believe that individuals spring into existence fully mature and ready to enter the market. The reality is that you can't have an individual without the collective, just as you can't have the collective without individuals. When you phrase things as a matter of superiority (without stipulating a scale), you open yourself up to simple mathematical refutation. If the individual is superior, then two individuals are twice as superior and so on until ultimately the collective is collectively superior to the individual. Asserting the superiority of the individual leads to clashes between individuals and between individuals and the collective. Ultimately this is self defeating. The mutual dependence between the individual and the collective means that both have to respect each other if either is going to thrive.

Just a quick note. You state that the individual doesn't exist without the collective. I'm not sure you meant to say that as it is prima facie not true.

You'll have to explain how that's not true.

Meanwhile, check out this fascinating article from the NYT: In a Helpless Baby, the Roots of Our Social Glue

Quote:
...
Human beings evolved as cooperative breeders, says Dr. Hrdy, a reproductive strategy in which mothers are assisted by as-if mothers, or “allomothers,” individuals of either sex who help care for and feed the young. Most biologists would concur that humans have evolved the need for shared child care, but Dr. Hrdy takes it a step further, arguing that our status as cooperative breeders, rather than our exceptionally complex brains, helps explain many aspects of our temperament.
...
Our capacity to cooperate in groups, to empathize with others and to wonder what others are thinking and feeling — all these traits, Dr. Hrdy argues, probably arose in response to the selective pressures of being in a cooperatively breeding social group, and the need to trust and rely on others and be deemed trustworthy and reliable in turn. Babies became adorable and keen to make connections with every passing adult gaze. Mothers became willing to play pass the baby.
...
You don’t need a bulging brain to evolve cooperative breeding. Many species of birds breed cooperatively, as do lions, rats, meerkats, wolves and marmosets, among others. But to become a cooperatively breeding ape, and to persuade a bunch of smart, hot-tempered, suspicious, politically cunning primates to start sharing child care and provisionings, now that took a novel evolutionary development, the advent of this thing called trust.
...

Quote: Original post by Dreddnafious Maelstrom

Quote:
I'm suggesting that we're not moving towards what in large part we've been living in since 1942. If you think that pointing that out means that I think it's superior, that's on you. (You really have a thing for superiority today don't you?) Imo, economic planning can play a positive role in society, but it's not the end all be all. It's not the total answer.

Yeah superior must be the adjective of the day for me subconsciously. I'm not sure I understand your point. Can you state more clearly whether you think we're moving towards a planned economy and whether you think a planned economy is superior(hmmm, this post sponsored by the word superior i guess) to a market based economy?

Also, there is a much celebrated idea in progressive circles that the countrty is slowly becoming more progressive. Does this square with your answer about planned economies or do you disagree with this idea?

Imo, the word superior is fairly crude in that used alone it leaves open the question of superior how. That said, I don't think we left the planned economy from WWII entirely behind. I think the Cold War was cooked up to justify it's continuation viz. military Keynesianism. In other sectors, the planning simply moved from government conference rooms to corporate board rooms. I know you're not fond of Galbraith, but have you read The New Industrial State? Do I think a planned economy is superior to a market economy? It depends. Superior how? Or do you mean preferable? I think they both have their merits. I think economic planning is useful for reducing risk and should be applied to risk averse sectors (e.g. health care). I think markets are useful for setting prices and distributing products and are preferable in other sectors (e.g. technology). I don't think the entire economy has to be all one way or the other. I prefer a mixture of the two, with the mixture favoring markets.

Quote: Original post by Dreddnafious Maelstrom

Quote:
Do you really think it's outlandish to say that the rich want to hold onto their wealth? It seems to me that, other than people preparing to enter into religious orders, everyone wants to hold onto their wealth and will do what they can to that end. It's almost ironic that you would deem that motive to be evil and claim that pointing it out amounts to illogic.

No, it's not unreasonable as a presumption. I just think it is unreasonable to dismiss a philosophy based on your proscribed motive. If I answered every progressive statement you made with, "because you conflate God and Government" it would'nt add much to the conversation, but that's at the heart of your philosophy. The belief that 1+1+1 = 7000.(Or more accurately, some number that we've never heard of that acts as both a prime number, a real number, a repeating decimal, and the square root of pi, so long as its greater than 3)

I dismissed an argument based on that motive. If you want to elevate that to an entire philosophy, o.k. Just the same, it's not outlandish to suggest that beneath a philosophy of wealth lurks the ulterior motives of the wealthy.

Quote:
That is one of the reasons the Fed cannot simply pump more credit into the economy and keep the boom going. Yet the economist John Maynard Keynes—back in fashion even though his system collapsed in the early 1970s when it couldn’t account for stagflation—proposed exactly this: “The remedy for the boom is not a higher rate of interest but a lower rate of interest! For that may enable the so-called boom to last. The right remedy for the trade cycle is not to be found in abolishing booms and thus keeping us permanently in a semi-slump; but in abolishing slumps and keeping us permanently in a quasi-boom.”

Quote:
Keynes was dealing in fantasy. The more the Fed inflates, the worse the reckoning will be. Every new wave of artificial credit deforms the capital structure further, making the inevitable bust more severe because so much more capital will have been squandered and so many more resources misallocated.

So where was the severe contraction following ww2 then? Can resources be any more misallocated from the perspective of the free market then a massive investment in things that have no economic value(massive armements)? Would anyone seriously claim that there was not massive federal inflation over this time period, or that it was followed by one of the longest periods of prosperity ever recorded? Surely the opposite should have been true?

The author of the article makes the point that Kenysian polices were ineffective in dealing with the economic situation in the 70s, and therefore will never be effective again. How then can one account for thier sucess in the 40s? It seems to me if you want to argue that such policies always lead to disaster, one needs to explain how they failed to do so in the past, just as people who argue that they always work(do such people even exist?) would have to explain the 70s.

Quote: Original post by Dreddnafious Maelstrom
I read an interesting article today from Tom Woods Jr. What struck me about it is his explanation on credit vs capital is very similar to my own.(We subscribe to the same school of economic thought). I wanted to take another crack at two issues we were discussing. One is my point about "parroting" versus describing a given economic philosophy. Note that this article was published after my very similar explanation. The other was in describing how understanding the difference between credit and capital invalidates Obama's approach, and further validates Schiff's critique. It also tackles nicely your table regarding productive capacity. Perhaps given the source his explanation will be considered more lucid.

I'll give it a read, but I won't likely respond until Sunday as I've got things to do tomorrow. Fwiw, The American Conservative is a very good journal of opinion imo, even if I don't always agree with the opinions published there.