Skip to main content

View Diary: Right-Wing Propaganda Masquerades as a High School Economics Curriculum (160 comments)

Comment Preferences

  •  Yes and no (1+ / 0-)
    Recommended by:
    Sparhawk

    While Keynes focused on macroeconomics and Capitalism is more microeconomics oriented, the two are somewhat at odds in that Keynes saw Capitalism as flawed and offered up a solution for what he thought would fix the problem.  The trouble is that by trying to force fit a recovery when recessions or depressions happen, the government spends a pile of money for some fake growth with no real sustained recovery in the economy.  Ultimately the market will take its pound of flesh for a real recovery to happen... We can either take a sharp downturn and then everything starts to tick back up at some rate, or spend a pile of money in order to attempt to delay a sharp downturn and then everything starting to tick back up...

    •  Capitalism is not "microeconomics oriented." (6+ / 0-)

      Capitalism is not an economic theory. It is an economic system in which the means of production are privately owned.
        What the hell is fake growth? Economic growth is economic growth. In Keynesian theory, in a recession, an increase in govt spending is multiplied through the economy so that the govt injection gets translated into increased consumer spending. Increased consumer spending adds to the number of jobs and becomes self reinforcing.

      Now, let's look at your belief: By what mechanism does a sharp downturn lead to an "uptick?" Classical economists (which is probably what you mean by capitalism) believe that the mechanism is price changes. Falling aggregate demand leads to deflation which leads to more spending which leads to recovery. When has that ever happened?
      BTW - I teach economics in a college.

       

      •  I've talked to people who say that before. (3+ / 0-)

        He probably means 'fake growth' because when the government spending stops, the jobs it created will hypothetically dry up with it.

        And all we're left with is roads, plumbing, electricity, bridges, internet and public transit.

        You know, 'wealth'.  The things that have absolutely no impact on the health of the public economy.

        I sometimes hear this from people who 'took a course' in economics once and are masters of the field now.  Funny how sometimes being armed with a teensy bit of information can make someone feel as if they're masters of the topic.

        Disclaimer: I 'took a course' in economics once.  In theory, I'm educated less about economics than the fellow you're talking to.

        •  One Million Auto Jobs Didn't Dry Up (1+ / 0-)
          Recommended by:
          ORDem

          After Cash for Clunkers ended after only 2 months.  Instead, the auto industry kept gaining momentum and jobs and now we are back to near normal levels of production and sales.

        •  We have a name for that (0+ / 0-)
          Funny how sometimes being armed with a teensy bit of information can make someone feel as if they're masters of the topic.
          It's called knowing enough to be dangerous but not enough to be helpful.

          America—We built that!

          by Mokurai on Fri Dec 07, 2012 at 09:16:25 AM PST

          [ Parent ]

    •  Fake Growth - Really? (1+ / 0-)
      Recommended by:
      ORDem
      The trouble is that by trying to force fit a recovery when recessions or depressions happen, the government spends a pile of money for some fake growth with no real sustained recovery in the economy.
      The government in July and August of 2009 spent $3B on the Cash for Clunkers program because during the 6 months before, auto sales had fallen to an annual average of under 10 million.

      After C-4-C, auto sales increased by 50% over the next 3 years to a near normal level of 15 million.  Sales were "jump started" by Keynesian economic principles and have been sustained ever since.

      Nothing "fake" about that growth and it didn't cost a "pile of money" either.

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site