Tag Archive: myths

May 04 2013

President Obama’s Austerity Does Not Make Him a Keynesian

It’s really sad it has come to this. There are many people that have jumped to branding President Obama as the second coming of famed economist John Maynard Keynes in what has become a rather sad attempt to deflect his austerity along with the deficit hysteria he preaches on a daily basis. Some people pretend the sequester he and Gene Sperling wrote along with putting chained CPI on the table(cutting seniors income) in order to get out it somehow “makes Obama a textbook Keynesian.” Nope.

It doesn’t take a lot of effort to know this is false.

“The boom, not the slump, is the right time for austerity at the Treasury.”

– John Maynard Keynes (1937) Collected Writings

Dec 17 2012

The Overhyped Fiscal Myth

Bruce Bartlett and Yves Smith on Overhyping the Fiscal Cliff

Bruce Bartlett and Yves Smith join Bill in a discussion about why Washington insiders are talking about the deficit crisis instead of the jobs crisis.

Transcript can be read here.

H/T Yves Smith at naked capitalism:

I had fun in this conversation with conservative Bruce Bartlett, even though he stole some of my best lines (like Obama not being a liberal). Bartlett is in exile from the Republican party for saying things like Keynesian deficits stimulate the economy (after doing research and finding he couldn’t debunk it based on data) and unions help promote higher wages.

Repeat after me, “Austerity is bad.

Nov 14 2012

The Myth of the “Fiscal Cliff”

No one actually cares about the deficit

Chris Hayes, host of Up with Chris Hayes,  discusses the stand-off between President Obama and House Republicans over the “fiscal cliff,” the name given to the combination of the expiration of the Bush tax cuts and the sequestration cuts mandated by last year’s debt ceiling agreement. Chris’ “filibuster” in the first segment is a “Cliff Note” summation of the debate about the so-called “fiscal cliff.”

Chris is joined for a comprehensive, and somewhat wonky, discussion with Hakeem Jeffries, newly elected Congressman representing the 8th Congressional District in Brooklyn, New York State Assemblyman; Teresa Ghilarducci (@tghilarducci), labor economist and director of the Schwartz Center for Economic Policy Analysis at The New Schoo; Edward Conard, former partner at Bain Capital from 1993-2007 and author of “Unintended Consequences: Why Everything You’ve Been Told About The Economy Is Wrong;” Ohio Democratic Senator Sherrod Brown; and Molly Ball (@mollyesque), national political reporter for The Atlantic.

I found this article  about the debt/deficit/”fiscal cliff” from letdgetitdone quite interesting. It presents a very compelling argument, point by point, why this entire discussion about a “fiscal cliff” is a myth. He concludes his argument:

So, current claims that we have a fiscal crisis, must debate the debt, must fix the debt, and must immediately embark on a long-term deficit reduction program to bring the debt-to-GDP ratio under control, all misconceive the fiscal situation because they are based on the idea that fiscal responsibility is about developing a plan to bring the debt-to-GDP ratio “under control,” when it is really about using Government spending to achieve outputs that fulfill “public purpose.” There is no fiscal crisis that will require “a Grand Bargain” and cuts to popular discretionary spending and entitlement programs. It is a phoney issue.

The only real crisis is a crisis of a failing economy and growing economic inequality in which only the needs of the few are served. MMT policies can help to bring an end to that crisis; but not if progressives, and others continue to believe in false ideas about fiscal sustainability and responsibility, and the similarity of their Government to a household. To begin to solve our problems, we need to reject the neoliberal narrative and embrace the MMT narrative about the meaning of fiscal responsibility. That will lead us to fiscal policies that achieve public purpose and away from policies that prolong economic stagnation and the ravages of austerity.

Sep 18 2012

Dispelling the Iranian Bomb Myth

Despite Israeli Prime Minister Benjamin Netanyahu’s bleating  on Sunday’s talk shows about Iran being months away from having a nuclear weapon, there is no hard evidence that Iran is even seeking to build one. I’ve written three articles since January dispelling this myth, yet here we are again. The right wing war hawks and Bibi are at it propagate this fairy tail. Even Israel’s own intelligence community has agreed with the International Atomic Energy Agency and U.S. defense and intelligence officials who have said that they believe that Iran has not made a decision on whether to acquire nuclear weapons. So once more here are the facts from historian of the modern Middle East and South Asia Juan Cole:

1. {..} Netanyahu’s own Defense Minister, Ehud Barak, who admitted that Iran has not decided to initiate a nuclear weapons program. Israel’s chief of staff, Benny Gantz, has also admitted that Iran has not decided to build a bomb.

2.  It is often argued that Iran does not need nuclear power. But it uses some petroleum for power generation, and Iranians are driving more and more. [..] Iran’s energy exports provide a crucial financial cushion, allowing the country to remain independent. Other oil giants, such as Saudi Arabia and the United Arab Emirates, are also building nuclear power plants. There is nothing illogical or unusual about Iran going in this direction.

3. It is alleged that Iran has threatened to annihilate Israel. It has done no such thing. Iran has a ‘no first strike’ policy, repeatedly enunciated by Supreme Leader Ali Khamenei. Iran’s president, Mahmoud Ahmadinejad, has expressed the hope that the ‘Zionist regime over Jerusalem” would ‘vanish from the page of time.’ But he didn’t threaten to roll tanks or missiles against Israel, and compared his hopes for the collapse of Zionism to the collapse of Communism in Russia. [..]

4. Supreme Leader Ali Khamenei has given a formal ruling or fatwa against nuclear weapons.

I skipped to 6

6. No, the International Atomic Energy Agency, on inspecting Iran, did not alleged evidence for bomb-making. It certified that no uranium has been diverted to a weapons program.

The last time that Iran launched a war of aggression was in 1826 when it attacked Russia over disputed territory. Iran, like the United States is a signatory of the Treaty on Non-Proliferation of Nuclear Weapons. Israel is not.

Mr. Netanyahu has been beating this drum since 1992. Iran is no closer now than it was then to having, or wanting, nuclear weapons. Yet, he and the right wing war hawks who took us into the Iraq misadventure, would have the world believe this fantasy. Pushing for another war in the Middle East would have very seriously negative consequences for the entire world.

Aug 02 2012

A 2012 Victory Won’t Bring Back the Economy: Only a Private Debt Jubilee

Cross posted in Orange and at Voices on the Square

Yes, this is true. It’s not a popular saying, but I’m not here to make everyone feel good for 2012 electioneering while people are suffering to feel a sense of belonging among the Washington elite prognosticating over poll numbers instead of real issues. As we have this debate over 4 percentage points in the tax code, the overall omission of most Americans suffering from the fallout of the housing bubble is insulting.

That’s right. This debate ignores the big elephant in the room; the millions of people underwater defrauded into mortgage debt and other private debt chaining them to their deflating assets with no sufficient income prospects added up and compounded in a usurious fashion sucking demand out of the economy. For those that do not “got theirs jack” and can’t afford cable news to cheer along with this partisan war syndrome dynamic, this actually matters.

It matters because as I have chronicled here, here, here, and here, the Foreclosure Fraud Settlement was an insult to the millions injured from the fallout of this bubble once NY AG was bought off to prop it up with stilts. Banks were given credit for the HAMP mods in addition to being propped up by the other failed HARP program. Basically those that defended that settlement or any of these programs anymore have to admit now they knew nothing.

For want or need of a nice election tune, many are tuning in to this election while too many are tuning out these debilitating economic problems because the absolute failure to deal with them at all. I partially understand, it is daunting and demoralizing, but whether one wants to tune in to these problems or not, the song remains the same.

It’s the song of the decade and it goes well beyond this election.