mrstickball said:
mirgro said:
mrstickball said:
mirgro said:
mrstickball said:
Yes, crap would hit the fan if there was a run on the banks. But in Greece even, that hasn't happened yet. It would take an incredible catastrophe for every nation to ask for its money back.
No one ever said what the US was doing was good. I'm against deficit spending more than anyone. Its a very bad thing to do.
However, the alternatives are horrible. The opposite (communism) calls for the destruction of private entities, which has always led to horrible results.
In fact, I'd argue that the US going halfway, into a socialist system like we have is the cause. Its not capitalisms fault. Its the establishment of various types of government programs that cannot be funded that are causing the problems. Capitalism would want free markets that put the responsibility for most services on the people, and not the government....What we have is the opposite in many countries.
So in fact, the problems the US, Greece and others is too much socialism. |
I cannot clearly remember the problems back in the 80s, but as an educated guess I doubt that it was the socialistic programs that caused the problems back then, especially since the majority of the Baby Boom population was actually funding the programs, not draining them. Furthermore, it was Capitalism that fucked the US back in '29 and it's rampant capitalism and lack of regulation that fucked the world this time around as well.On the other hand, the Russian economy fell under for many reasons, one big one being too much regulation. Both systems are utter trash.
I actually just recently learned who Kaynes was, but apparently I have been his diehard fan for a long time now. He is absolutely correct in what he said, when it comes to the economy as a large, capitalism fails miserably. The reason is simple, people are greedy fuckers and bastards, and you need to whip them into shape so that the economy in general doesn't go to shit. The crisis that jsut hit now is a perfect example of what happens when you have free greedy people and let them run free.
Capitalism sounds just as good as Communism does on paper, and it's about as effective too. I can't think of any world economy crisis ocurring because of regulated businesses.
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So, explain to me exactly how capitalist, free-market changes to America during the late 20s and early 30s caused the great depression. Go on, I have the time to wait.
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My American Hisotry is a little rusty so bear with me. If I can remember one factor was the simple fact that more goods were produced than people could buy. All the money was kept at the top and since the top people are so few in number and don't need everything produced they didn't buy anymore, meanwhile the lower classes just didn't ave the money and then the businesses didn't get their money back so they became poor too.Regulation could have prevented this.
Then this is the big one that I can remember, the margin requirement for investment was just 10%. For every 1$ I invested, brokers would just give me 9$ as a loan and voila. Huge amounts of people bought huge amounts of stock, and the moment all the brokers wanted their money when things got dicey, the other people couldn't pay. This led to the huge bank runs and the stock market crash. If there was more regulation such would also not happen. It was caused purely by the greed of the people.
All this is also ignoring the fact of how the current mess of things happened, which is directly linked to unregulated greed of businesses. People are bastards and assholes, they don't give a shit and hence to prevent a widescale tragedy regulation is needed.
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Sorry for the quick response, eve of a few finals so I can't formulate my thoughts staright but this is what I am getting. You are saying that the government intervention only made the normal recession into a depression. I agree. First off, for 1987, and all of the 80s actually, you have a graph like this:
The heavy recession in the 80s was solely saved because of government spending, for one cause or another. Reagan built nukes and Bush went to war. Both Bushes actually. Just about every major stock crash has been fixed by going to war, or more specifically, the increase in spending that is associated by going to war, which is in itself a big government intervention.
Another thing I would like to point out, there are really shitty things governments can do. Just because a government fucked up once, does not mean regulation as a whole is bad. It just means the decisions made were just bad. As an example, COmmunism failed due to horrible regulation and just too much regulation.
If there was a regulation back in '29 that stated that had the marginal cost at say, 50% instead of 10%, the crash would have been much milder and the bad decisions made afterward would not have needed to be made in the first place. It's a chicken-egg sort of problem. The same applies for today's problems. If there were regulations on speculation and banks were kept in rein, there wouldn't have been such a bust a year ago, I guess nearing two soon.
Obama is now spending a ton of money, and while I don't agree with it, he is basically doing what everyone else did before him to fix a drop like the one last year. The only reason I can see why he gets bashed is because it's not for a war, but something quite a lot less meaningless (war to me is absolutely meaningless and a waste of money as I see it, just to clarify). Yes the reasons are questionable but it's not as bad as war. He is literally doing what has worked for the previous stock crashes.
Lastly I want to address youe Keynesian attack. Again, I jsut learned about Kaynes just a month or so ago, but from what I get he never said that someone should just spend and not fix underlying problems and the causes that caused the crash in the first place. Problems need to be fixed, one of which is human nature and only regulations can fix that, and then you should spend. Correct government decisions with measured spending will allow an economy to recover, and put it in the position to start reducing its debt.
This is as far as I go tonight, I have to get in enough REM cycles to remember everything I learned. Hopefully it won't be about economics.
