Stimulus or austerity?

The big question facing the world's economy today is how to get out of our current malaise.

On one side, we have the republican party, the German government, and the European Central bank saying that governments need to cut their deficits through tax increases and/or cuts in spending on social services, preferably a balanced approach that is tilted in favor of spending cuts. The theory behind this is your basic classical story: huge spending on social services today financed by debt will necessitate large taxes in the future, which discourages long-term investment. Spending cuts are better because they are supposed to address the source of the problem, which is future growth in spending on social services ("The US Federal Government is basically an insurance company for old people with an army on the side")

On the other side, we (used to) have the democratic party, the Italian and Greek governments, Francois Hollande, and a large part of the economics profession saying that governments need to spend more and central banks need to print more money because the ultimate cause of our current crisis is a shortfall in demand on the part of consumers and investors. Investment demand will not pick up any time soon unless consumption increases because interest rates are zero, and investment is a function of interest rates.

OT, I ask you, should OECD governments be following stimulus or austerity?

people in western countries need to start having more kids.

Considering the shape Spain is in, I find it kind of odd that France would elect Hollande and other socialists.

The big question facing the world's economy today is how to get out of our current malaise.

On one side, we have the republican party, the German government, and the European Central bank saying that governments need to cut their deficits through tax increases and/or cuts in spending on social services, preferably a balanced approach that is tilted in favor of spending cuts. The theory behind this is your basic classical story: huge spending on social services today financed by debt will necessitate large taxes in the future, which discourages long-term investment. Spending cuts are better because they are supposed to address the source of the problem, which is future growth in spending on social services ("The US Federal Government is basically an insurance company for old people with an army on the side")

On the other side, we (used to) have the democratic party, the Italian and Greek governments, Francois Hollande, and a large part of the economics profession saying that governments need to spend more and central banks need to print more money because the ultimate cause of our current crisis is a shortfall in demand on the part of consumers and investors. Investment demand will not pick up any time soon unless consumption increases because interest rates are zero, and investment is a function of interest rates.

OT, I ask you, should OECD governments be following stimulus or austerity?

radicalcentrist

We're already seeing the results of government cutbacks at some local levels. Government jobs are cut and, quelle surprise, the local economic situation gets worse. If that's done at a massive level or if vital programs like social security and medicare are gutted then it's only going to hinder recovery. The real problem is two-fold. One, no one wants to do the right thing by Keynesian economics when it's time to do it, i.e. raise taxes during good times to build a surplus. This is what we should have been doing all along, but instead we gave out unnecessary tax cuts. Two, we spend massive amounts of money on wasteful programs. Our military is bloated and needs reduction, and subsidies should be moved away from industries that don't need them and towards industries where they can stimulate growth and generate long-term returns.

people in western countries need to start having more kids.

whipassmt

people in western countries need to start having more kids.

whipassmt

I dont know. Perhaps, neither. Maybe just not cutting every government service would be the way to go. We dont necessarily have to go out and have the govt. try to spend trillions to stimulate the economy, either.

I dont know. Perhaps, neither. Maybe just not cutting every government service would be the way to go. We dont necessarily have to go out and have the govt. try to spend trillions to stimulate the economy, either.

sonicare

The good part about the most recent round of spending in the U.S. is that it's investing in things that should have been done decades ago like updated transportation. It's investing in the country and creating jobs when they're most needed at the same time.

I wouldn't mind an increase in taxes to help pay down the debt as long as there was not an increase in social spending programs and nowadays, that is par for the course. Everyone is wanting a handout for nothing instead of taking it upon themselves to do for themselves. The Greeks are a good example of a nanny state though there are other problems there too.

Governments as well as people need to live within their means and if the money isn't there, don't spend it.

I think we may need to adopt a more austere lifestyle at the individual level, where people tighten their belts and give up some of their luxuries.

I wouldn't mind an increase in taxes to help pay down the debt as long as there was not an increase in social spending programs and nowadays, that is par for the course. Everyone is wanting a handout for nothing instead of taking it upon themselves to do for themselves. The Greeks are a good example of a nanny state though there are other problems there too.

Governments as well as people need to live within their means and if the money isn't there, don't spend it.

WhiteKnight77

Social spending programs aren't handouts. Unemployment is contingent on showing proof that you are looking for jobs, and Democratic proposals have included job training as part of unemployment. Medicaid allows people to be healthy so that they can be better able to perform at jobs. Medicare and Social Security allow individuals to retire at an early enough age so that there are more positions available fo younger workers. These programs all work to benefit society as a whole, not just individuals who "want something for nothing."

I think we may need to adopt a more austere lifestyle at the individual level, where people tighten their belts and give up some of their luxuries.

whipassmt

I wouldn't disagree with this outside of the context of a discussion on macro economics. However, this recession wasn't caused by people spending luxuriously, and belt-tightening (which is going on anyways) isn't going to solve it. In fact, this recession spun out of control due to a lack of consumer demand, i.e. people spending less.

[QUOTE="whipassmt"]

I think we may need to adopt a more austere lifestyle at the individual level, where people tighten their belts and give up some of their luxuries.

theone86

I wouldn't disagree with this outside of the context of a discussion on macro economics. However, this recession wasn't caused by people spending luxuriously, and belt-tightening (which is going on anyways) isn't going to solve it. In fact, this recession spun out of control due to a lack of consumer demand, i.e. people spending less.

[QUOTE="WhiteKnight77"]

I wouldn't mind an increase in taxes to help pay down the debt as long as there was not an increase in social spending programs and nowadays, that is par for the course. Everyone is wanting a handout for nothing instead of taking it upon themselves to do for themselves. The Greeks are a good example of a nanny state though there are other problems there too.

Governments as well as people need to live within their means and if the money isn't there, don't spend it.

theone86

Social spending programs aren't handouts. Unemployment is contingent on showing proof that you are looking for jobs, and Democratic proposals have included job training as part of unemployment. Medicaid allows people to be healthy so that they can be better able to perform at jobs. Medicare and Social Security allow individuals to retire at an early enough age so that there are more positions available fo younger workers. These programs all work to benefit society as a whole, not just individuals who "want something for nothing."

Workman's Comp or unemployment is something that a company pays into the government to help pay an employee if they are released from the job for certain reasons and is not really a handout. It could be all classified as part of a benefits package for all eligible employees. On the other hand, medicaid is one that only certain individuals can use. One has to meet certain criteria in order to be able to access it and most of the ones using it, are not working, thus not paying into it. Their being healthy does not benefit anyone other than themselves.

Basic Eligibility Criteria

You may be eligible for Medicaid if your income is low and you match one of the following descriptions:
You think you are pregnant
You are a child or teenager
You are age 65 or older
You are legally blind
You have a disability
You need nursing home careGeorgia Department of Community Health

That does not mean that they shouldn't be healthy, but they are relying on someone else to ensure that they are. That is a definition of a handout.

[QUOTE="theone86"]

[QUOTE="whipassmt"]

I think we may need to adopt a more austere lifestyle at the individual level, where people tighten their belts and give up some of their luxuries.

whipassmt

I wouldn't disagree with this outside of the context of a discussion on macro economics. However, this recession wasn't caused by people spending luxuriously, and belt-tightening (which is going on anyways) isn't going to solve it. In fact, this recession spun out of control due to a lack of consumer demand, i.e. people spending less.

I agree wiht the first part, however I have a hard time accepting the suffering of others as a necessary step in getting to an ideal economy. If yacht owners and people with fifty-room houses were hardest hit in a recession then I'd be all for it, but the people who have the hardest time are the ones who were already struggling before it hit.

[QUOTE="theone86"]

[QUOTE="WhiteKnight77"]

I wouldn't mind an increase in taxes to help pay down the debt as long as there was not an increase in social spending programs and nowadays, that is par for the course. Everyone is wanting a handout for nothing instead of taking it upon themselves to do for themselves. The Greeks are a good example of a nanny state though there are other problems there too.

Governments as well as people need to live within their means and if the money isn't there, don't spend it.

WhiteKnight77

Social spending programs aren't handouts. Unemployment is contingent on showing proof that you are looking for jobs, and Democratic proposals have included job training as part of unemployment. Medicaid allows people to be healthy so that they can be better able to perform at jobs. Medicare and Social Security allow individuals to retire at an early enough age so that there are more positions available fo younger workers. These programs all work to benefit society as a whole, not just individuals who "want something for nothing."

Workman's Comp or unemployment is something that a company pays into the government to help pay an employee if they are released from the job for certain reasons and is not really a handout. It could be all classified as part of a benefits package for all eligible employees. On the other hand, medicaid is one that only certain individuals can use. One has to meet certain criteria in order to be able to access it and most of the ones using it, are not working, thus not paying into it. Their being healthy does not benefit anyone other than themselves.

Basic Eligibility Criteria

You may be eligible for Medicaid if your income is low and you match one of the following descriptions:
You think you are pregnant
You are a child or teenager
You are age 65 or older
You are legally blind
You have a disability
You need nursing home careGeorgia Department of Community Health

That does not mean that they shouldn't be healthy, but they are relying on someone else to ensure that they are. That is a definition of a handout.

Medicaid is primarily for low income, so that could mean unemployed or employed, but still in a poor economic situation. Ensuring that those people (and their children) have healthcare helps them in finding a job and performing well at it. If you're already living in poverty and you become ill then you have no chance at moving up and contributing more to society.

As for the rest covered by Medicaid, they are either unable to work or are gaming the system. The latter I absolutely think should be found out and punished, but I can't find a justification for simply ignoring the former. Of course, a better way to ensure the health of all of them would be some form of universal healthcare.

Both. Not sure why politicians seem to think it is either/or. Probably because they are stupid; which seems highly correlated with 'politician'.

Austerity. Because some people in the government can't be trusted to do what's right when the time comes for it.

How about everybody lives below their means for a change?

Austerity. Because some people in the government can't be trusted to do what's right when the time comes for it.

airshocker

Austerity has the same problems though, they cut the wrong things.Person0

That's unfortunate, but the government isn't a very good steward of our taxes. I see no reason to give them anymore of our money.

[QUOTE="Person0"]Austerity has the same problems though, they cut the wrong things.airshocker

That's unfortunate, but the government isn't a very good steward of our taxes. I see no reason to give them anymore of our money.

Awesome, and I see no reason to allow you access to our roads, drinking water, or the benefits of an educated labor force.

[QUOTE="Person0"]Austerity has the same problems though, they cut the wrong things.airshocker

That's unfortunate, but the government isn't a very good steward of our taxes. I see no reason to give them anymore of our money.

Awesome, and I see no reason to allow you access to our roads, drinking water, or the benefits of an educated labor force.

theone86

Your point? I already pay taxes for those things.

[QUOTE="airshocker"]

[QUOTE="Person0"]Austerity has the same problems though, they cut the wrong things.theone86

That's unfortunate, but the government isn't a very good steward of our taxes. I see no reason to give them anymore of our money.

Awesome, and I see no reason to allow you access to our roads, drinking water, or the benefits of an educated labor force.

Middle class, sure. Rich class can definitely pay more, though. l4dak47

That's not really the issue, though. At least not for me. The issue for me is the government's inability to use our tax dollars wisely.

[QUOTE="theone86"]

Awesome, and I see no reason to allow you access to our roads, drinking water, or the benefits of an educated labor force.

airshocker

Your point? I already pay taxes for those things.

And you're saying you don't want to pay taxes for those things.

And you're saying you don't want to pay taxes for those things.

theone86

Since when? LOL.

[QUOTE="l4dak47"]Middle class, sure. Rich class can definitely pay more, though. airshocker

That's not really the issue, though. At least not for me. The issue for me is the government's inability to use our tax dollars wisely.

[QUOTE="theone86"]

And you're saying you don't want to pay taxes for those things.

airshocker

Since when? LOL.

That's unfortunate, but the government isn't a very good steward of our taxes. I see no reason to give them anymore of our money.airshocker

.....then stop voting in the same politicians every damn time.l4dak47

I'm not. I'm voting for Romney who has said he's going to do something about it.

OHMAGERD, I FORGOT A SPACE IN BETWEEN ANY AND MORE!

I thought it was plainly obvious that I meant any more additional taxation.

[QUOTE="l4dak47"].....then stop voting in the same politicians every damn time.airshocker

I'm not. I'm voting for Romney who has said he's going to do something about it.

Hahahaha. Romney is working for the same master as Obama is. He ain't gonna do sh*t. And furthermore, he doesn't even have the power to make significant changes. You would need to vote out all current members of Congress to(maybe) see a difference. l4dak47

I doubt it.

[QUOTE="l4dak47"]Hahahaha. Romney is working for the same master as Obama is. He ain't gonna do sh*t. And furthermore, he doesn't even have the power to make significant changes. You would need to vote out all current members of Congress to(maybe) see a difference. airshocker

I doubt it.

Doubt what?l4dak47

Well since I quoted you and wrote "I doubt it"...ah, you figure it out.

OHMAGERD, I FORGOT A SPACE IN BETWEEN ANY AND MORE!

I thought it was plainly obvious that I meant any more additional taxation.

airshocker

A. It wasn't.

B. The best fiscal governance in recent years has been accompanied by the highest tax rate. George Bush slashed taxes, left two wars and a medicare spending bill off the books, and presided over the financial meltdown. Bill Clinton had a higher tax rate, but ran the government at a surplus and required that any spending be offset by other spending cuts or new taxes. New taxes aren't necessarily an indicator of poor governance, in fact tax cuts have often been an indicator of poor governance.

[QUOTE="WhiteKnight77"]

Workman's Comp or unemployment is something that a company pays into the government to help pay an employee if they are released from the job for certain reasons and is not really a handout. It could be all classified as part of a benefits package for all eligible employees. On the other hand, medicaid is one that only certain individuals can use. One has to meet certain criteria in order to be able to access it and most of the ones using it, are not working, thus not paying into it. Their being healthy does not benefit anyone other than themselves.

[quote="Georgia Department of Community Health"]

Basic Eligibility Criteria

You may be eligible for Medicaid if your income is low and you match one of the following descriptions:
You think you are pregnant
You are a child or teenager
You are age 65 or older
You are legally blind
You have a disability
You need nursing home caretheone86

That does not mean that they shouldn't be healthy, but they are relying on someone else to ensure that they are. That is a definition of a handout.

Medicaid is primarily for low income, so that could mean unemployed or employed, but still in a poor economic situation. Ensuring that those people (and their children) have healthcare helps them in finding a job and performing well at it. If you're already living in poverty and you become ill then you have no chance at moving up and contributing more to society.

As for the rest covered by Medicaid, they are either unable to work or are gaming the system. The latter I absolutely think should be found out and punished, but I can't find a justification for simply ignoring the former. Of course, a better way to ensure the health of all of them would be some form of universal healthcare.

Having health care does not enable anyone to find a job. All it does is enable them to see a doctor when they get sick and have it paid for. While being healthy is beneficial in being able to work, it does not mean that said person could actually do the work. Having the proper training means that they can do the work and that I have no problem with, after all, the old saying of "give a man a fish, feed him for a day, teach a man to fish and feed him for a lifetime" holds true. The problem is, way to many people want a fish for a day and a visit to any social services department shows exactly that.

[QUOTE="l4dak47"]Doubt what?airshocker

Well since I quoted you and wrote "I doubt it"...ah, you figure it out.

A. It wasn't.

B. The best fiscal governance in recent years has been accompanied by the highest tax rate. George Bush slashed taxes, left two wars and a medicare spending bill off the books, and presided over the financial meltdown. Bill Clinton had a higher tax rate, but ran the government at a surplus and required that any spending be offset by other spending cuts or new taxes. New taxes aren't necessarily an indicator of poor governance, in fact tax cuts have often been an indicator of poor governance.

theone86

That's only because you've got a terrible memory. We've had this discussion many times. I'm more than willing to pay taxes for things I directly benefit from.

First off, again, you're being facetious when you blame Bush for the financial meltdown. The meltdown only happened because of policy Bill Clinton and Andrew Cuomo initiated.

I'm sorry, I will never support a highly-taxed, oppressed society. It won't happen.

[QUOTE="theone86"]

[QUOTE="WhiteKnight77"]

Workman's Comp or unemployment is something that a company pays into the government to help pay an employee if they are released from the job for certain reasons and is not really a handout. It could be all classified as part of a benefits package for all eligible employees. On the other hand, medicaid is one that only certain individuals can use. One has to meet certain criteria in order to be able to access it and most of the ones using it, are not working, thus not paying into it. Their being healthy does not benefit anyone other than themselves.

[quote="Georgia Department of Community Health"]

Basic Eligibility Criteria

You may be eligible for Medicaid if your income is low and you match one of the following descriptions:
You think you are pregnant
You are a child or teenager
You are age 65 or older
You are legally blind
You have a disability
You need nursing home careWhiteKnight77

That does not mean that they shouldn't be healthy, but they are relying on someone else to ensure that they are. That is a definition of a handout.

Medicaid is primarily for low income, so that could mean unemployed or employed, but still in a poor economic situation. Ensuring that those people (and their children) have healthcare helps them in finding a job and performing well at it. If you're already living in poverty and you become ill then you have no chance at moving up and contributing more to society.

As for the rest covered by Medicaid, they are either unable to work or are gaming the system. The latter I absolutely think should be found out and punished, but I can't find a justification for simply ignoring the former. Of course, a better way to ensure the health of all of them would be some form of universal healthcare.

Having health care does not enable anyone to find a job. All it does is enable them to see a doctor when they get sick and have it paid for. While being healthy is beneficial in being able to work, it does not mean that said person could actually do the work. Having the proper training means that they can do the work and that I have no problem with, after all, the old saying of "give a man a fish, feed him for a day, teach a man to fish and feed him for a lifetime" holds true. The problem is, way to many people want a fish for a day and a visit to any social services department shows exactly that.

I'm not saying that having a healthcare means being able to get a job, but it's hard to get a job when you get sick and have no healthcare.

I'm having a hard time what social services you're referring to. If we're in agreement that social security, medicare, and unemployment all provide services that benefit society, then as far as I can tell all that's left is medicare. As I said, this improves the health of low-income workers and people searching for jobs, so that leaves only poor individuals who are physically unable to work and people gaming the system. If you're saying we should go after the latter then I agree, so that leaves two possibilities. Either you're dismissing completely the claim that medicaid doesn't aid in finding and keeping employment, or you don't mind that people with serious disabilities simply go without healthcare, or both.

Most of this is kinda moot, anyways, as I'd prefer some form of single-payer to both medicare and medicaid, but as it stands I think medicaid is preferable to nothing both from a pragmatic and humanitarian standpoint.

[QUOTE="theone86"]

A. It wasn't.

B. The best fiscal governance in recent years has been accompanied by the highest tax rate. George Bush slashed taxes, left two wars and a medicare spending bill off the books, and presided over the financial meltdown. Bill Clinton had a higher tax rate, but ran the government at a surplus and required that any spending be offset by other spending cuts or new taxes. New taxes aren't necessarily an indicator of poor governance, in fact tax cuts have often been an indicator of poor governance.

airshocker

That's only because you've got a terrible memory. We've had this discussion many times. I'm more than willing to pay taxes for things I directly benefit from.

First off, again, you're being facetious when you blame Bush for the financial meltdown. The meltdown only happened because of policy Bill Clinton and Andrew Cuomo initiated.

I'm sorry, I will never support a highly-taxed, oppressed society. It won't happen.

You're more than willing to pay for SOME things you directly benefit from, others not so much.

Balanced budgets led to the financial meltdown?

You're more than willing to pay for SOME things you directly benefit from, others not so much.

Balanced budgets led to the financial meltdown?

theone86

No, I'm willing to pay for all of the things I directly benefit from. I don't benefit from SS, so I don't want to pay for it. I don't benefit from medicare, medicaid, thus I don't want to pay for it.

I'm willing to pay for roads, since I use them. In fact I pay a lot for them and I get a pretty crummy return on my investment. I'm willing to pay for emergency personnel, I'm willing to pay for schooling because I benefit from an educated populace. I'm willing to pay for services like water, electricity and trash removal.

Oh you! :lol: Don't pretend like you have no idea what I'm talking about.

[QUOTE="theone86"]

You're more than willing to pay for SOME things you directly benefit from, others not so much.

Balanced budgets led to the financial meltdown?

airshocker

No, I'm willing to pay for all of the things I directly benefit from. I don't benefit from SS, so I don't want to pay for it. I don't benefit from medicare, medicaid, thus I don't want to pay for it.

I'm willing to pay for roads, since I use them. In fact I pay a lot for them and I get a pretty crummy return on my investment. I'm willing to pay for emergency personnel, I'm willing to pay for schooling because I benefit from an educated populace. I'm willing to pay for services like water, electricity and trash removal.

Oh you! :lol: Don't pretend like you have no idea what I'm talking about.

You benefit from SS (prevents overcorwding in the job market to a degree), you do benefit from medicare and medicaid (a healthy workforce).

No, I don't. You're touting people who slash taxes and initiate unchecked spending as people who know how to handle government, while decrying people who preside over functional government spending as undeserving of tax dollars.