NetNews Usenet Archive 1993 #3/NN_1993_3.iso/spool/talk/politics/theory/5756

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From: [e-mail] (Broward Horne)
Newsgroups: talk.politics.theory,talk.politics.misc
Subject: Re: National debt is not bad
Date: 24 Jan 1993 19:42:26 GMT
Organization: Case Western Reserve University, Cleveland, OH (USA)
Lines: 115
Message-ID: <[e-mail]>
References: <[e-mail]> <[e-mail]> <[e-mail]> <[e-mail]>
Reply-To: [e-mail] (Broward Horne)
NNTP-Posting-Host: hela.ins.cwru.edu


In a previous article, [e-mail] (Ted Frank) says:

>In article <[e-mail]> [e-mail] (Broward Horne) writes:
>>>Of course they are.  What are they supposed to do, leave the money in a
>>>vault?  Why not invest it in T-bills, which is what it comes out to
>>>this way.
>>
>>       Hmmm. Maybe "invest" it in low-risk companies, rather than
>>       welfare programs?  Nayyyy.
>
>I thought you were just complaining how the government is spending poorly.
>Why should the government borrow money to invest in low-risk companies
>when private investors have the incentive to do so already?  (Investors
>*don't* have the incentive to build infrastructure *and* charge marginal
>cost for the use of the infrastructure, which is when we need government.)


    Ted, ted, ted.  Read your own words.  What should the government
    do with the Social Security SURPLUS.  Who said anything about
    borrowing?
>
>>>>>which made revenues go down as the economy shrank, which led to more cuts,
>>>>>which ...
>>
>>      Oh, now *this* is pure bullshit.  In all previous recessions,
>>      governments had followed the EXACT same policies.
>
>I have no idea what you're talking about, because you're certainly not
>talking about any planet I've lived on.  There's a huge difference
>between how governments of today handle recessions and how governments
>of a century ago handled them.


      Yes, Ted.  That's my point.  Now why do you suppose that a
      Great Depression never happened before 1929?

>
>>>You got cause and effect mixed up.  *Because* of government stimulus, there
>>>is no comparison between now and the Great Depression.  The various
>>>safety nets prevent a complete collapse of the economy if there's some
>>>shrinkage.
>>>
>>>If the economy shrinks, (1) tax revenues go down and (2) unemployment,
>>>and therefore unemployment benefits paid out by government, go up.
>>>Presumably, poverty also increases, so those welfare payments increase.
>>>Decreased revenues and increased spending equals more deficit.  By
>>>definition.  If there were a balanced budget amendment, every time
>>>there was a recession, there would have to be increased cuts in government
>>>spending and increased taxes, which would worsen the recession, which
>>>would lead to increased taxes and spending cuts, which would ad
>>>infinitum...
>>
>>      Hmmm.   How odd that this never happened in previous recessions,
>>      Interesting, but bogus.
>
>Big surprise that it "never happened" -- there's never been a balanced
>budget amendment.


      Sigh.  Pre-WWII.
>
>>>>>I think it's even more dangerous to exaggerate the problem of the debt,...
>>
>>       Yes, yes, ignore it.  Look, you BUILD a case against yourself.
>>       If it's so fragile it can't be talked about, then there is
>>       a problem.
>
>You're reading too much in -- where do I say "don't talk about the debt"?
>
>If the problem is "A" it does us no good to pretend the problem is "B."
>
>>>Others have called for a balanced budget come hell or high water.  I'd
>>>prefer a look at the underlying economic issues rather than a simpleminded
>>>approach of "balance the budget because deficit is bad".
>>
>>      Well, then, CHUM, you better get out there and start educating
>>      our foreign holders of debt, institutions, etc, hadnt' you?
>
>They are educated.  Which is why they're not panicking, and you are.
>Uneducated investors get their heads handed to them in the market.


     Yep, there it is again.  " Panic ".  Hehehe.

     Why on EARTH do you suppose the % of world currency trade
     conducted in U.S. dollars has dropped, from roughly 80%
     in the lat 70s, to a roughly equal distribution between
     the Mark, Yen, and Dollar?  I'm interested in your explanation.

>
>>       Building an economic tower of babylon, depending on arcane and
>>       possibly incorrect theories, dependent on ALL users to
>>       have full in-depth technical knowledge is pure folly.
>>
>>      Even as user-friendliness, ease of use, etc are being taught
>>      to new generations, we have an economic cadre of black-magic,
>>      determined to collapse.
>
>You really take pride in wallowing in ignorance, don't you?


     No, Ted.  In 1990, I realized that the great majority of
     managers and leaders are woefully lacking in quantitative
     thinking.  That's why I'm a business major now.  Well, plus
     it didn't pay me to work anymore.  I have to admit, since
     jumping on the gravy train, I'm way happier.  Free health
     insurance, federal grants, etc.   :)

>--
>ted frank                     | [e-mail]
>standard disclaimers          | void where prohibited
>the university of chicago law school, chicago, illinois 60637
>