Monday, November 17, 2008
The NEW New Deal: Dead on Arrival
Like all Americans, I was raised to believe that the "New Deal" got us out of the Great Depression.
But a team of UCLA economists have determined that some of FDR's policies prolonged the depression by 7 years. Proponents of the Austrian school of economics have been saying this for decades.
The smart money is calling the New New Deal dead on arrival.
For example, Bloomberg writes:
President-elect Barack Obama and House Speaker Nancy Pelosi may throw as much as half a trillion dollars worth of stimulus at the economy -- and have little or no growth to show for it.
One of the leading authorities on monetary policy says that the Fed and Treasury are "fighting the last war", and using an approach that they think would have worked in the Great Depression, even though the cause of the 2 financial crises are entirely different.
Now, Congress and Obama are set to duplicate the fiscal stimulus approach of FDR.
Instead of being smart and taking actions which will work, all branches of the government appear to be spending sums we can never repay to take actions which will likely be ineffective.
3 comments:
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What are your thoughts on this?
ReplyDeletehttp://www.moneyandmarkets.com/the-g-20s-secret-debt-solution-27996
In 1968 it took one billion dollars in new debt to create one billion dollars in new GDP. Today it takes 5 trillion dollars in new debt to make one trillion dollars in new GDP. We have a debt bearing currency and are at the end of the cycle, The only way out is to have a debt free money. A good intellectual explanation can be found here: www.Monetary.org
ReplyDeleteThere is a group holding demonstrations in 39 cities on Nov 22nd to End the FED. www.EndtheFED.us
It's amazing how the fact of this 'money out of thin air' and the perpetuating debt machine with I-owe-you tensilcards is getting no word in the commission talks - that it's all a game of cards that they actually CAN keep standing by increasing the cosmic originated cash flow. Something like that.
ReplyDelete