Everything Should Be Cut In Economic Crisis

Actually, this isnt true. Tax rates had a lot to do with the great depression.

 

It certainly was in the 1938 recession, during the recovery from the great depression. The Govt cut spending in 1937 to trim the deficits. By 1938 the nation was back in a nasty recession and unemployment jumped back up. Spending increased in 1939 and the recovery resumed.




source: http://www.usgovernmentspending.com/

Year - unemploy. rate - % chng real GDP
1930 8.9 -8.6%
1931 15.9 -6.5%
1932 23.6 -13.1%
1933 24.9 -1.3% <-FDR takes office, spending increases
1934 21.7 10.9%
1935 20.7 8.9%
1936 17.0 13.1%
1937 14.3 5.1% <- Spending cut
1938 19.0 -3.4%
1939 17.2 8.1% <- Spending increase
1940 14.6 8.8%

Are we dumb enough to not learn from and relive history and the mistakes of 1937? Could be.

 

No one said they did.
Try to keep up.

 

Right wingers are.
They seriously think taking huge amounts of money out of the economy will spur growth.
This in spite of the historical evidence and the real time example happening in Europe right now!

 

Yes, post-WWII, we went from an age of the largest Government liability in history and societal rationing, to an economy taken by storm by a huge in-rush of labor now completely off the Gov't dole as of leaving the service. Austerity works if you actually do it, not the European (*)(*)(*)(*)(*)foot approach of merely cutting the growth of spending, I mean real cuts, like deconstructing the largest Naval and Bomber force ever seen on the face of the planet, and reducing 91 Army divisions to less than 20.

Production is meaningless if it isn't creating wealth. That means it isn't paying for itself, an unsustainable paradigm that merely consumes wealth generated elsewhere.

Jobs, by the way, are not the ends of the economy. Rather, they themselves are a means to an end, to put food on the table. And you can only put food on the table, if there's first the wealth to generate it.

 

They created a magical economy in their heads. Nothing said can deter them from their cult like beliefs.

 

Maybe instead of worrying about spending cuts we should put a cap on borrowing.

 

That's not a bad idea.

 

Nor is it my job to try to figure out your bull(*)(*)(*)(*) claims.

 

^ Isn't that what the debt ceiling is?

Seriously? This, from the school whose frontrunner is advocating the Government pays for producing cars we just throw into the sea, and faking an alien invasion?

That Keynesian theory can at all be taken seriously after that, just boggles the mind.

 

This is nonsensical. We have used "Keynesian theory"... aka Govt spending during recession for the last 75 years. You are once again just making stuff up in your own head. In fact this past 4 years was the first time we have tried austerity measures in 75 years. Look how good that is turning out.

99% chance you are a Republican

 

Surprisingly, not a single person has been able to explain to me... if debt is so bad how can this happen?

 

If you have 1 million of dollars invested in R&D, and you reduce this budget to half, 500.000 dollars, then you will have to cut things there, in people, machinery,... and that would lead to less research and development, that is less services.

The same with healthcare or education. Or with military, you will have to do less international operations, less investment in new weaponry, etc.

However, you can change how you do things, and save money, keeping the services. But what I've lived of cuts, is remove services, abolish them. That are the consequences

 

LOL!!!
See what I mean?! The right really does think austerity will spur growth!
They are delusional!

This why conservatives should never again be in control of our economy.

 

Stop making things up, you will do much better.

 

I laid it out quite clearly and gave you my source. But if you're too intellectually lazy to do a little reading, here's a breakdown. Just go to the "Budget Breakdown for 2012" section.

 

That's not necessarily a bad thing. You don't solve a problem by throwing money at it. Reduction in spending doesn't mean reduction in service. You can get better service out of it.

 

Saint ronnie the raygun LOVED Keynesian measures, it's how he lowered the unemployment rate, granted it took 8 years and the wealthy got filthy rich at the same time but huge spending is how he did it.
His biggest and most damaging aspect was the failed 'trickle down', something we have yet to get away from and it is KILLING the country.

 

I thought based on conservative theories that creating more money creates inflation which hurts the economy? So just like the debt graph, explain how this can happen.... For some reason data does not ever back up your claims, which is why you have to resort to philosophy and just making things up.

 

He almost tripled the national debt in his 8 years. For Obama to get that luxury he would have to increase deficits to $3.5 trillion a year for the next four years. That is how much money/debt Reagan flooded the economy with. Reagan would be Keynes' best friend!

 

I wouldn't know, I'm not a conservative.

 

At this point its not about spurring growth, its about saving the nation from financial disaster. The only way to do that is to balance expenditures to income. Continuing to deficit spend will only take us down the road to fiscal chaos. There is only so much money to borrow, print, and take via taxes-----------the govt has to drastically reduce spending. and yes, almost everyone will suffer in some way because of it. It must be done, we must take our medicine like adults and fix the mess for the next generations.

 

You're thinking of a national budget too much like a household budget. The goal of economic policy is not to get out of debt. In fact if a country goes too far into the black it can have negative problems too.

The goal isn't to balance the budget. The goal is to achieve growth in the jobs market and opportunity ladder. Cutting those benefits would make those goals harder to obtain.

 

That's one way of looking at it.

 

People have been saying this for the past 75 years. They have been wrong for 75 years. What a shocker!