Dear John, (01)
The issues you raise below are repeats of the ones
we have already discussed. I think your view
won't change on this, so I suggest we move on to
something we can get our minds into, such as the
definition of Keynesian economics. (02)
Keynes believed that by injecting liquidity into
the economy (i.e., by increasing the money supply)
government could stimulate the economy. He did
not, as Hazlitt points out, take the full measure
of the situation; the taxes extracted from the
economy or the losses due to borrowing money to
inject, both come from productive economic markets
which must be reduced to get the charge of money
that is injected. (03)
By not including that loss in his calculations,
Keynes committed the error of incorrectly drawing
the lines of the economic system he studied.
Hazlitt made that clear, and therefore improved
knowledge of how the Keynesian strategies ignored
a significant part of the system he studied. (04)
-Rich (05)
Sincerely,
Rich Cooper
EnglishLogicKernel.com
Rich AT EnglishLogicKernel DOT com
9 4 9 \ 5 2 5 - 5 7 1 2 (06)
-----Original Message-----
From: ontolog-forum-bounces@xxxxxxxxxxxxxxxx
[mailto:ontolog-forum-bounces@xxxxxxxxxxxxxxxx] On
Behalf Of John F. Sowa
Sent: Sunday, November 06, 2011 9:50 PM
To: ontolog-forum@xxxxxxxxxxxxxxxx
Subject: Re: [ontolog-forum] Self Interest
Ontology (07)
On 11/5/2011 3:31 PM, Rich Cooper wrote:
> I discovered a book written in 1948 that
explains why the Keynesian
> theories don't work - he describes what he calls
the "broken window
> fallacy" here:
>
>
http://www.fee.org/library/books/economics-in-one-
lesson/
>
> I hope that helps stimulate more discussion of
the role of self
> interest in AI and in ontology developments. (08)
Two points: (09)
1. The author, Henry Hazlitt, is a typical
blue-sky academic with lots
of opinions, but no facts or experimental
evidence to back them up. (010)
2. Keynes was also an academic. But he became
wealthy by observing
the facts about currency fluctuations,
formulating a theory based
on the facts, and testing his theory with his
own money. Today,
currency trading is not a good field for
making money because
everybody follows the same principles that
Keynes established. (011)
I'm not going to defend all Keynesian policies
because there has
been 80 years of further research and practice.
But US presidents
from Franklin Roosevelt to Ronald Reagan have
shown that the basic
ideas are sound. Roosevelt applied some of
Keynes' ideas in the
1930s. He helped to mitigate the disaster created
by 12 years
of Republican economics. But he didn't spend
enough money until
1939, when he used the war in Europe as an excuse
for big-time
spending. The massive war-time spending ended the
Depression,
as Keynes had predicted. (012)
I hate to give credit to Hitler for anything, but
I have to admit
that he got Germany out of an even worse financial
problem by
classical Keynesian means: a huge amount of
military spending
that created prosperity for Germany several years
before Roosevelt
started the really big-time spending. (013)
Ronald Reagan also dug the US out of a recession
by classical
Keynesian spending. The Republicans mistakenly
say that he cut
government. But that is false. It is true that
he cut domestic
federal spending by shifting the burden to the
states. But his
military spending *tripled* the federal debt. The
Republicans
also say that he cut taxes. For the rich, he did.
But for the
middle class, the increase in state and local
taxes wiped out
the tiny tax cut that Reagan gave them. (014)
Reagan's collectivism wasn't as blatant as
Stalin's. Instead of
directly taking small farms and bundling them as
large collectives,
he just subsidized the big corporate farms and
drove small farmers
out of business. The big subsidies were reserved
for huge collectives
that grow corn and soybeans. The small farmers
who grew vegetables
for the local markets got nothing. (015)
Reagan's policy of welfare for big corporations
was very similar
to Hitler's policy of promoting big corporations
at the expense of
the small businesses and individuals. That isn't
as blatant as
Stalin's collectivism. It's a more subtle form of
collectivism
and anti-individualism. (016)
Republicans treat Reagan as a god for promoting
"wealth building".
Look at the statistics: In 1979, the top 1% of
all Americans earned
9% of the total amount of income. But in 2009,
the top 1% earned
17% of the total. That is almost double the
amount they got before
Reagan. The bottom 50% of all taxpayers earn only
13% of the total. (017)
Finance professionals really love the term "wealth
building."
They got a 238% increase. (Statistics from New
York Times,
30 October 2011, Sunday Review, page 10) (018)
Whenever you hear Republicans say "wealth
building", that's
a synonym for "rape the middle class". I am very
strongly in
favor of self interest. That's why I am no longer
a Republican. (019)
John (020)
__________________________________________________
_______________
Message Archives:
http://ontolog.cim3.net/forum/ontolog-forum/
Config Subscr:
http://ontolog.cim3.net/mailman/listinfo/ontolog-f
orum/
Unsubscribe:
mailto:ontolog-forum-leave@xxxxxxxxxxxxxxxx
Shared Files: http://ontolog.cim3.net/file/
Community Wiki: http://ontolog.cim3.net/wiki/
To join:
http://ontolog.cim3.net/cgi-bin/wiki.pl?WikiHomePa
ge#nid1J (021)
_________________________________________________________________
Message Archives: http://ontolog.cim3.net/forum/ontolog-forum/
Config Subscr: http://ontolog.cim3.net/mailman/listinfo/ontolog-forum/
Unsubscribe: mailto:ontolog-forum-leave@xxxxxxxxxxxxxxxx
Shared Files: http://ontolog.cim3.net/file/
Community Wiki: http://ontolog.cim3.net/wiki/
To join: http://ontolog.cim3.net/cgi-bin/wiki.pl?WikiHomePage#nid1J (022)
|