Economics 101 re Unemployment Comp

[ivanm]

i am not specifically discussing unemployment insurance.  However, it does stimulate the economy.

My discussion was about the stimulus as such.  These Republican guys claim they are against it.  Of course, if they become the majority, they will be all for it without saying anything.  They are liars.

You can bet they will want to spend money. That is how they stay in office, by rolling pork.

[Velleity]

i am not specifically discussing unemployment insurance.  However, it does stimulate the economy.

Ivan just made that up about the lack of stimulative effect. If he was cognizant of the empirical evidence he would know that not only is it stimulative, it is one of the most stimulative line items behind food stamps while tax cuts for the rich, which is the "conservative" panacea, is actually one of the least stimulative things that the government can do.

Ivan has the nerve to make stuff up like this and then to claim he knows what he's talking about, or that he's not as stupid as he is making himself out to be.

[johnhp]

You can bet they will want to spend money. That is how they stay in office, by rolling pork.

Then why would people vote for them if the republicans say they are not going to keep the stimulus moving?

[johnhp]

Ivan just made that up about the lack of stimulative effect. If he was cognizant of the empirical evidence he would know that not only is it stimulative, it is one of the most stimulative line items behind food stamps while tax cuts for the rich, which is the "conservative" panacea, is actually one of the least stimulative things that the government can do.

Ivan has the nerve to make stuff up like this and then to claim he knows what he's talking about, or that he's not as stupid as he is making himself out to be.

Of course he did.  The ripple effect of the purchasing power cannot be denied.

[ivanm]

Ivan just made that up about the lack of stimulative effect. If he was cognizant of the empirical evidence he would know that not only is it stimulative, it is one of the most stimulative line items behind food stamps while tax cuts for the rich, which is the "conservative" panacea, is actually one of the least stimulative things that the government can do.

Ivan has the nerve to make stuff up like this and then to claim he knows what he's talking about, or that he's not as stupid as he is making himself out to be.

Food stamps are an ongoing thing and in spite of what you think, that did not ameliorate the recesson.

[Velleity]

Of course he did.  The ripple effect of the purchasing power cannot be denied.

It's actually called the multiplier effect. Money re-circulates through the economy so spending a dollar yields more spending, depending on what the money is being spent on.

Saving has a multiplier effect too but not as great as the effect of spending.

All of this is very well documented and refutable only by hard core ideologues who are not willing to be persuaded by facts.

[johnhp]

Ivan

If some guy gets a check because he is unemployed he will be able to spend that money on certain items.  The shop from which he purchases these items will have to restock their shelves, pay employees, etc.  That is what we are getting at.

You keep thinking this is an either/or scenario; it is a both and.  Money needs to be spent on vigorous stimulus such as building, but it should be spent for unemployment.

[Velleity]

Ivan

If some guy gets a check because he is unemployed he will be able to spend that money on certain items.  The shop from which he purchases these items will have to restock their shelves, pay employees, etc.  That is what we are getting at.

You keep thinking this is an either/or scenario; it is a both and.  Money needs to be spent on vigorous stimulus such as building, but it should be spent for unemployment.

What Ivan doesn't understand is the basic law of supply and demand. In fact I have never seen a "conservative" poster on the internet who understands the basic law of supply and demand and I have never seen a "conservative" who can give even a basic argument against Keynesian macroeconomics.

Any money spent by the government raises the demand curve. There is no math or viable theory or empirical evidence to suggest that anything the government can do will affect the supply curve. Cutting taxes has the same effect on demand. However some things have greater multiplier effects than others.

Since you talk about building, another thing "conservatives" never mention is that their dumbass "starve the beast" sophistry has yielded a tremendous problem relative to deferred maintenance on our infrastructure. How is this deferred maintenance any different in any real respect from debt? We will have to pay for this somehow in the future and, in fact, we will pay more than we would have paid if we had adequately maintained our infrastructure. In fact some of us, or some of our children, may end up paying the ultimate price when something large collapses on them.

I am frequently amazed at the intellectual incoherence of these people.

[ivanm]

Then why would people vote for them if the republicans say they are not going to keep the stimulus moving?

You just don't get it.  They give it another name like defense spending and people eat it up out of fear of being attacked.  The same goes for the humongous farm subsidy programs.  People have been led to believe that we would run out of food if we don't pamper the mega farmers.   

Both parties spend but their priorities are different.  So the label of stimulus is appropriate or relative only for recovery purposes.  I don't think some of the Republicans even see the need for a recovery program as they think the economy will right itself without government intervention. It probably will, but ar a great social cost.