You're missing so much. 4 of the companies went bankrupt. How can you say obliterating the incomes of all those employees, their pensions, health care, and multiplier effects somehow increase C? Are and were there companies that were vulnerable, inefficient, and bloated? Yes. Is the "best" outcome hostile takeover, dismantling, mass firing, and outsourcing that create vast amounts of wealth for the already wealthy who pay almost no tax on what was done? Perhaps the most efficient outcome in terms of more guns and butter is winding down a company, but without a social policy in place to protect everyday workers the outcome is negative, socially and economically. You can't just see a formula or a curve to determine if it is a good outcome.

it has useful properties other than being flammable

But does it have more useful properties than public works spending?

From wiki gold reserve:


"It has been estimated that all the gold mined by the end of 2009 totaled 165,000 tonnes.[2] At a price of US$1900/oz., reached in September 2011, one ton of gold has a value of approximately US$60.8 million. The total value of all gold ever mined would exceed US$9.2 trillion at that valuation. All the gold in the World would fit in to a standard size swimming pool."



Which of the following do you think has more useful properties to society? Is it all the gold reserves in the world of $9.2T, or only half that amount, $4.6T worth of infrastructure? If you could only choose between humanity having a swimming pool full of gold or $4.6T worth of infrastructure, which would you choose?

gold cause it's shiny and pretty and quite heavy too


let them eat flakes



srsly though, I'd rather see private roads and infrastructure. I don't think it's very beuno for the government to steal money from people and spend it "on their behalf". It could never be as efficient as people spending their own money.

You're hungry. Would you rather buy whatever food you want on your own, or would you rather I take your money and buy whatever food I think you should eat?

Paul Krugman clearly thinks that a faked alien invasion would fix the economy and that the only real problem is that it won't happen. This is what Schiff is mocking.

From Wikipedia:

There is literally, no ****ing way, that all the gold ever mind would fit into a standard sized swimming pool, unless you have some mother ****ing huge swimming pools.

Excellent counter-argument: the crimes of the father are the crimes of the son.

This spending can benefit some of the "judicious Janets" in the long run. Let's say Janet owns a trucking business that is located on the North side of large lake and her deliveries must go to the far South side. Privately spending her money to build a bridge across the lake to save on gas for her trucks could never be recouped in her lifetime. So government Gus steps in mainly to help out spendthrift Sams with construction jerbs, but it also helps some Janets as well, in time.


The thing is there are way more spendthrift Sams than Janets in society today. By not appeasing them with public spending we may end up in a worse way overall, like the Sams voting in a dictator and engaging in war for resources to satiate their irresistible need to consume (Germans WW2.) A little inflation and low interest rates on savings is then the lesser of two evils. And like Krugman said, Janet still has an edge over Sam in the market because Janet is not revenue constrained, so it's not completely unfair.

But that still means demand has increased (if the lower prices attract buyers that is), causing the need for more labor.

If I have an ice cream shop and lower my prices and people buy more, well demand has increased, and if I can't fill that demand I have to hire.

I could lower prices and people NOT buy more, and I wouldn't hire more people.

Meaning lowering my prices, while it might make my product more attractive is not the actual reason hiring goes on. The increased demand causes the new hires (provided I can't meet that demand with my current staff).

neither helps the economy(except for some people who like to wear gold and ****). now your turn!

Actually yes it does. Maybe an olympic size pool but none the less. It's a releitively small amount compared to the value that is bestowed upon it for the only reason that it is a rare substance. Even worn as jewelery it's still pretty much usless. It doesn'e keep you warm and you cant eat.

However 4.6T could be enough money to virtually elimanate unemployment in the US if that money were put to use building a nation wide Lite Rail system. A necessity to the future of the US economy as transpation fuels are becoming more exspensive and supplies are on the verge of permanent decline.

I don't always agree with Professor Krugman but his effect on rightwing nuts is salutary.

to me this is his worst piece. "i create nothing i own" has got to be the dumbest saying ever. It should be, "I create Everything I own!"

Uhh... what? It's made my parents a hell of a lot of money... even with pretty much nut worst timing (they switched all of their savings to his brokerage before the huge commodities/emerging markets correction in 2008).

Rhetoric? He always explains his positions logically. The guy's views on macro trends are incredibly nuanced.

I'm sorry but I fear your comment was either a work of brilliance or entirely incoherent and I'm not qualified to tell which it is.

Im just putting this out there to break the memetic and semiotic sub texts of all discussion on this forum.

Perhaps Krugman and Schiff are both tards?

Just saying, because the whole

Krugman is a tard
Schiff though

Is so predictable and tedious. Krugman is obviously a tard when he talks Alien invasion, I dont see what bearing this has on the tard factor of other talking heads.

It didn't say that, it said all the current gold reserves in the world would fit in a pool, not all gold ever mined.

...

LOL "nuance"? How so? OMG GOVERNMENT SPENDING IS GOING TO DESTROY THE WORLD ECONOMY is not nuanced. His most common rhetorical trick(as seen in the Krugman video) is to appeal to his personal incredulity.

Like, the whole appeal of his schtick is the lack of nuance! It's simple enough for everyone to grasp(without having to spend years in some liberal elitist college), it's "common sense". Do you know what the word "nuance" means?

I am not familiar with the 4 companies. Are these companies Bain bought and deliberately drove into bankruptcy? Would they have gone bankrupt anyway? Was bankruptcy just used to expunge the debt, leaving the company unburdened and able to continue operating afterwards?

In any case, it doesn't matter. I never argued that the immediate effects of Bain's operations didn't leave people unemployed. I am arguing that making companies more efficient is good for society and leaves us all better off despite the fact that some laid off workers have to go through an unemployment period.

Also, let me congratulate you on being the only Krugman defender in this thread actually trying to defend Krugman.

Your problem is refusing to admit the scenario in which a company doesn't make another company more efficient by firing workers and doesn't add value to society.

The first part of Krugman's argument is simply saying that the above scenario exists, and the second part of his argument is that Bain capital fits into that category. I don't have in-depth knowledge of Romney's business practices so if someone wanted show some numbers proving that Romney really did turn these companies around that would be a legitimate argument, but people aren't taking that line. Instead it seems like everyone is up and arms about the first part of Krugman's argument as if that scenario is somehow impossible.

I fully admit that this is possible. Mistakes are going to happen. I think on average though private equity deals are making companies more efficient. If they weren't how do they make money? You don't make more money by getting lower output from not proportionally lower inputs.

He's written entire books on the specifics of the business cycle. Read "How an Economy Grows and Why it Crashes" and then get back to me. It's an excellent application of Mises' theories used to understand the modern economy. Just because the talking heads on CNBC are always playing him off as a doomsayer in 5 minute segments doesn't mean he doesn't know what he's talking about.

And what about the fact that his clients are making tons of money? Face it dude, you were talking out of your ass because you don't like the guy and you got nabbed.

The Lord and Creator itt?

Yeah, but the fact that he doesn't know what he's talking about does mean that he doesn't know what he's talking about. OMG he writes ENTIRE BOOKS.

I have not personally read "How an Economy Grows and Why It Crashes", but here's the first page of a positive review from a right wing publication:
The economics books I read are very light on amusing cartoons, and they don't make it fun or accessible. Because it's not.

1) I actually don't know for a fact that his clients are making tons of money.

2) Short term variance, if you bet on a bear market constantly you will do well during downturns. And then you'll do poorly during upturns.