Re: Just because you're paranoid...
 

Distinction without a difference. And you get the point. No need to defend Rain Man here. Neither of you is on the econ faculty anywhere. Drilling the definition down to one so narrow you can claim to refute mine and Less's practical point is tantamount to conceding the point.

It's structural. There's a huge mismatch. And I'm not even getting in the portion of unemployment attributable to people being unable to move due to the housing mess. Which is, again, a for of structural unemployment.

You scored some points on me with the Keynesian thing. I missed an essential point the guy made there, I think. In this debate, you're off. Not your fault, of course. You're holding Adder's water here, and he's hopelessly academic on this shit.

Re: Just because you're paranoid...
 

It's not a pure deleveraging thing. I don't need to cite the endless white papers explaining how unqualified for any of the future growth industries much of our workforce is, and will remain.

If our labor were competitive with foreign labor in terms of cost, unemployment and stagnant wages, which drive lack of demand, would not be problems. But they're not. They're grossly overpriced, and in many instances, not trained for the work that would compete. We can be needledick lawyers and argue whether that's structural or something else all day citing the differing definitions of the term, but one thing we can agree upon is it's not simply cyclical.

Re: Just because you're paranoid...
 

The rs wanted UAW concessions to approve the Big 3 bail outs. The Dems insisted the concessions could wait until the next labor negotiation round. Now the UAW is looking for more money, because the Big 3 is back "healthy."

when GGG first said "it's all free," my first thought was "He is Gilligan." Lately I'm afraid he was just mouthing the party line. Sad.

Re: My God, you are an idiot.
 

That is madness. That is, varnish of scholarship removed, in a nutshell: "Print, print, print, and print some more, until the private sector eventually turns around. Never stop. Never consider, 'Hey, we're turning into Zimbabwe.' Always print until the private sector comes back, no matter how long it takes."

Keynes never lived to see how long his policy could be used before it absolutely collapsed a nation's currency. He was gifted WWII, which took us out of the Depression while destroying the industrial capacities of all of our competitors. I doubt if he were alive today he'd advocate endless endless printing in a contraction like this one.

Why? Because this is not a common recession. It was wise to start with Keynesian policies. After a time, however, it becomes unwise.

I know... I know. You want to see the simple logic of "You can't print forever" beaten by the intellectual policy of an economist you clearly admire. Sorry. Sometimes, reality is Just as Simple as it Seems. You can't print forever. Eventually, it leads to trade wars and actual war. See Niall Ferguson for the rest of that explanation. He's written about it endlessly.

Re: My God, you are an idiot.
 

You aren't stupid. So why do you insist on pretending to be on the internet?

More in the morning.

Re: Just because you're paranoid...
 

This is not a semantic point. We all know there are no jobs for construction workers. If we had an economy where there were lots and lots of employers looking unsuccessfully for, say, high-tech workers, then we would have structural unemployment, with a mismatch between construction and high tech.

That's not the economy we have. There is no mismatch, because there is massive unemployment and there is NO part of the economy creating lots of jobs which are going begging. Structural unemployment is not the reason we are so full from full employment. If you think it is, you have to not only point to some part of the economy where things are lousy for workers, like construction, but also to some part of the economy where the opposite is true. There isn't one. The employment situation is lousy all over the place.

Re: My God, you are an idiot.
 

I'm not sure where you found this caricature of a Keynesian economist. I'm not familiar with anyone saying anything like that.

Re: My God, you are an idiot.
 

You should follow Adder on Twitter.

And, as others have noted, Adder you need to get beyond your pedantic lawyer obsession with terminology. The rest of you too.

Whatever you call it, we are halfway down a jump out of an airplane. the Fed just said there is no parachute - your bleating about further deficit spending notwithstanding. It's time to bend our knees, hit and roll, and wait for the swelling to go down.

Ty said it referring to me sayin it - "You said it before. It's deleveraging. Once we work through it the economy will start to grow again, but there are still a lot of people with mortgages they can't pay, etc."

Yup. So what's your non-caricaturistic Keynesian point?

Re: Just because you're paranoid...
 

Yes it is. Think globally. There is a huge need for workers we don't create. This is a global economy. Our unemployment problem is not cyclical. Perhaps we can disagree over whether it is classically structural. Fine. The point is, large sections of our workforce will never be competitive again, or even work again.

Whatever that is, it's not cyclical. And you're wrong if you think we'll return to something like 5% unemployment in the next decade. We will hemorrhage jobs, or at best stagnate in terms of employment, until the cost of foreign labor meets ours, and the skill sets of greater numbers of our workforce meet those of skilled workers abroad.

You can't argue against that point. You will. But you won't succeed. It's ironclad fact.

And please, don't say, "Inflation is going to cause their workers to become more expensive. The more the Fed prints, the more their labor costs rise. Another basis for further Keynesian policies!" Debasement of one's own currency is exactly what Ferguson has argued leads to trade and real wars. And that's only if it works. Right now, it appears that every time our numbers swoon, the world swoons with us. This means emerging markets have not yet decoupled, and are probably not self-sustaining enough to do so any time soon. So even if we kept on printing, it probably wouldn't have the desired result of making our workforce more competitive versus competition.

That's the conundrum. Print like mad and it works, trade wars, then real war. Print like mad and it doesn't work, an exercise in futility that punishes domestic savers. Many of whom are retirees.

You clearly worship Keynes. You might also consider Friedman: No free lunches. A position with which Keynes would agree.

Re: My God, you are an idiot.
 

That's your point run to its logical conclusion.

Your Keynesian/Krugman-esque hypothesis that we can print our way of this rests on the assumption the private sector will inevitably fill in the lack of demand. That Keynesian spending will hold us at equilibrium until the private sector comes back.

In a traditional recession, you're right.

But this is, to borrow from Rogoff, a Great Contraction. We've printed and spent (they necessarily go together), and printed and spent, and we have sustained a better equilibrium than we would have otherwise. But the private sector, and the consumer, hasn't stepped in to pick up the slack.

So what do we do? Two choices. Print more and risk debasing the currency to the point it no longer remains the world reserve (China's been making a solid case for a non-dollar reserve for a long time), destroying the immense advantage we've had since Bretton Woods? Or stop printing and let the economy take some of its medicine, as Less described it.

We can't preserve equilibrium indefinitely, Ty. So tell me, where's the sunset on your Keynesianism? At what point do you say, "Enough. We have to sacrifice some future equilibrium on the employment and human side to preserve the greater equilibrium we enjoy from remaining a AAA rated state with the world's reserve currency"?

That's the problem every Keynesian has right now: They all know it can't persist indefinitely. But few, if any, of them want to admit it.

Re: My God, you are an idiot.
 

I disagree on one point. It's a tired idea, but I think a pared down WPA put to work on infrastructure maintenance is a good idea. Why not? Spend $1-200bil, ask the states to match, and put a few million construction people back to work for a time. We need to do it anyway.

Re: Just because you're paranoid...
 

First, Ferguson is a demonstrated idiot on monetary issues.

Second, at least try to understand the arguments of others before you shit on them.

Re: My God, you are an idiot.
 

Maybe we can find some way to tie our financial future to the incredible growth in the Chinese and Indian economies? Perhaps we can try something creative - like trading Georgia for Mumbai and giving Mississippi, Alabama and Tennessee to the Chinese in exchange for a couple of Shanghai suburbs? All of those states are doing their best to develop third world economies anyways - maybe China or India can do something with them?

Seriously, at some point we have to deal with the drag on our economy from some of the economically marginal states. Ongoing federal subsidies from the states with real economies are fundamental causes of the deficit, and, at the same time, those other states regularly lower our own economic standards by undercutting us with lower wages and lower taxes (affordable in part thanks in part to our subsidies). I say we cut a grand deal, where we give the Rs the balanced budget amendment on the condition that it also require that next costs and benefits of taxation be reasonably apportioned among the states, so no state receives more than 110% of the what it pays in taxes or pays less than 90% of the benefits it receives.

Re: Just because you're paranoid...
 

The more I've read it, the more I reach the conclusion I am in agreement with Ty's article. I said Keynesianism is a bridge to new growth. Ty's point was, not only is it a bridge to new growth, but a guarantee that when growth does reappear, it is at an equilibrium consistent with previous growth. His point is a bit unique to mine, but could also be argued to have been subsumed in mine. You know many bridges with one side far lower than the other?

But I can't use simple analogies with you. You're in the clouds. Which is why, as much as you cite academic studies here, nobody takes your points seriously. It's egghead gibberish. You're utterly unable to talk in practical terms or see anything through the eyes of a businessperson, or for that matter, any regular person on the street. Like a typical dickhead lawyer, you want to find some semantic angle on which to say, "You're wrong! I'm right!", ignoring the rest of the conversation.

I didn't shit on Ty's argument. I agreed with most of it. I shit on yours. I still shit on it, and I'll probably shit on most of those you offer going forward because, well, they're usually shit. Dense pseudo-intellectual pontifications. Hell, even the National Review article you cited sucked. "We shouldn't aim for inflation. But we do need some policies the main effect of which will be, yes, inflation." Stated otherwise, ease (which, of course = inflate, but nevermind that). Brilliant fucking point.

(Cue Adder furiously rereading that article to distinguish it from my paraphrasing.)

By the way, Adder
 

Who's been right about the trajectory of the economy so far? You, buying the retail adviser horseshit (tomorrow will almost always be a lot like yesterday), or me?

We're not headed for The Road, but I'm a hell of a lot more accurate so far than you.

You earn the ad hominems. God, how you earn them.

Re: Just because you're paranoid...
 

That's one of the things that is so strange. You people keep saying things like this, while I don't recall ever citing an academic study.

I have, however, linked to any number of blogs that have actually dealt with how to analyze the situation we are in, which is not at all unlike where Japan has been for some time now, and you still make knee-jerk, homespun arguments against Keynes.

But another of the things that is so strange, is that I haven't been arguing for Keynes, or at least not beyond the extent that you accept it (i.e., spending can help fill the gap).

Instead, where you depart is with the Friedman-like, quasi monetarist part of the argument. That is, you rail against "printing money" and "debasing the currency" as if these things are inherent evil. In doing so, you miss the what a broad range of economists will tell you: in the kind of slump we are in now, featuring lots of deleveraging and with policy interest rates at zero, neither monetary nor fiscal stimulus is going to lead to inflation unless and until it also leads to growth.

You have made clear that you do not agree, but I've seen nothing from you about why you don't agree, nor have I seen you engage with the arguments.

Maybe that's because I haven't been clear enough about them, and, for the most part, because I've linked to people who understand these things more than I do (after all I've had exactly one college level macro course, I think), but I'll try to put in a nutshell as best I understand it, through a bit of history.

So, you have Keynes saying, shock to demand leads people to panic and reduce their consumption and increase their saving, thus via paradox of thrift, you get the great depression. Hayek responds, no way, people saving more means more money available for credit which means lower interest rates which means investments that weren't profitable at the higher rates now become profitable, thus the economy rights itself. Keynes wins for the time being, but Friedman (and others) come along and largely kill off Keynes because in most circumstances, Hayek is right about the importance of interest rates and the supply of loanable funds, and control of policy interest rates and the money supply can be more effective and responsive than fiscal policy.

Cue the Krugman's of the world, who say, consistent with Friedman, fine, well, but what happens when your paradox of thrift kicks in and people save so much that rates go to zero and can't go any lower? In other words, what happens when supply of loanable funds sufficiently exceeds demand such that the market clearing rate is/should be negative? Or, as DeLong would put it, there is excess demand for safe assets (e.g. cash, government bonds) where what people really want is lots of perfectly safe stores of value. Those whose bias is left (Krugman, Thoma, DeLong) will say borrow cheap and spend, thus increasing the supply of safe assets as the market wants without fears of uncontrollable inflation (because there is lots of demand for those safe assets). Those on whose bias is on the right (Sumner, Beckworth, Mankiw, at times hints of agreement from Cowen) say lots of quantitative easing. The concept is the same. Because people want dollars and/or government bonds (essentially the same thing as a store of value at zero rates), hyper inflation will not be imminent.

You say, "fuck all that noise" what's going on is that the long-term trends of the last fifty years, when American manufacturing has declined and American labor is less competitive are now suddenly acute and can't be fixed.

But again, the argument about what "structural" means is telling. Most people use it as a justification for doing nothing, which is why I resist using it so much, and I think why Ty does as well. But you don't use it that way, and you don't use it the way the economist do. Fine. When you say "structural" you mean "we've got problems that are going to last awhile." Again, fine. I don't think those problems are as big an obstacle as you do, because as usual, I think your sense of proportion is out of whack, and I think your desire to understand macroeconomics through story arcs is misplaced. But your predictions will probably turn out to be right if the people who like to talk about how it's all structural get their way and we do nothing.

Brilliant. You don't get it so it must suck. Congrats, you have proven yourself a true American, in all the ways that you typically condemn.

Nope, your paraphrase is about right. It was his positioning for why people who read the National Review shouldn't be freaking out about inflation.

Re: Just because you're paranoid...
 

That's a truly strange way to read the Fed statement.

When it says things like this:
and

It's saying it can do other stuff.

Re: My God, you are an idiot.
 

Jeb Bush channels Spanky, comes up with The Grand Strategy.

Shit. Growth! I mean, when you put it like that, it is *so* *simple*.

Re: Just because you're paranoid...
 

I'm not saying that no part of unemployment in the US is structural. Obviously there's been quite a bit of it in recent years. But the reason why unemployment jumped in the last couple of years is not because there has suddenly been more structural employment. It's because we've had a financial crisis.

Re: My God, you are an idiot.
 

This isn't to you Gattigap.

So I'm Spanky's friend on another web community, the real guy. I've seen photos. He is actually with very pretty women a lot, and some seem too young (for him, not legally). He may have been the most honest about his real life of anyone here.

Re: My God, you are an idiot.
 

I really don't get your "printed and spent" point. We've continued to spend at more or less the same rate as before.

Aside: Many of the people who are exercised about federal spending are exercised because a Democrat is the President (and a black one to boot), so they have rediscovered a concern about federal spending that is entirely situational -- it disappears when a Republican is in the Oval Office. (What Obama has done is, by and large, not all that different from what Mitt Romney would have done as President, and if he had done it Republicans would be lining up to cheer, but for a few Jesus freaks who would be freaking about his being Mormon.) And we've seen substantial cuts in spending at the state and local level, so the overall picture is hardly one of an expanding government. Yet the public discourse has been captured by the sort of Tea Party freaks who show up at meetings to complain that the UN is going to expropriate their land.

What is different is that we keep cutting taxes to try to stimulate the economy (if you're a Democrat) and because it's what your donors want (if you're a Republican or a Democrat). And there's been a recession. So government revenues have declined dramatically, and we have deficits. But that has much more to do with the fiscal picture than the macroeconomy.

Your concern about debasing the currency is insane. As Krugman points out, people have been worrying about inflation for two or three years, always predicting that the sky is about to fall, and we still have historically low interest rates. You have inflation when the economy is running hot. We have the opposite. People can't find things they want to invest in -- lending is risky, and there's a flight to the few safe investments, which means Treasuries. You saw this again this week when the stock market dropped like a bomb on fears of a double-dip recession and everybody moved to Treasuries, notwithstanding S&P's downgrade. The market is saying that it wants to put money in US government bonds because they're safe.

What is this medicine you and Less talk about it? There's nothing beneficial about people getting hurt. We already have this colossal loss from the millions of people who are sitting around, not working, instead of doing something. I think you said that we should put some of them to working doing construction, and I agree. This country's infrastructure is decidedly sub-standard compared to a lot of places, and now is a great time to fix that -- we have people out of work, and we have people willing to lend us the money to build stuff for nothing.

Instead, we're going to have the GOP try to block the renewal of the gasoline tax, which pays for highway maintenance.

I really, really don't understand the concerns about phantom inflation when we have all these people out of work. One problem is thirty-five years old and entirely notional. The other is all around us.

Re: My God, you are an idiot.
 

http://assets0.ordienetworks.com/ima...x.jpg?c6228763

Click through for more.

Re: My God, you are an idiot.
 

And we spend way less on it, and have been spending at lower rates over time.

Re: My God, you are an idiot.
 

Re: My God, you are an idiot.
 

You could, of course, keep borrowing from Rogoff and conclude that a bit of inflation would do a world of good.

From my point of view, you borrowed the less useful bit (I don't really care whether you call it Great Contraction or Liquidity Trap or Balance Sheet Recession or whatever).

I don't usually agree at that much with libertarian economist Arnold Kling, but I'm with him on the evaluation of the monetary policy options.

Re: My God, you are an idiot.
 

On the other hand, I can see the fancy new bridge where I35W goes over the Mississippi from my office window (if I strain a little), and it only took the deaths of 13 people in the collapse to get it, so maybe we can combine efforts? Maybe herd old people onto failing infrastructure and kill two birds (biddies?) with one stone?

Re: My God, you are an idiot.
 

you think NY delays are the fault of technology, or lack thereof? I assume NY delays are there are too many planes trying to jam into undersized airports. I'm not sure Star trek technology will help there.

i know the chart claims technology will help. How would it?

Re: My God, you are an idiot.
 

I like that I post a chart with some analysis done by people who have taken a hard look at the question, and give you a link that you could use -- if you cared to, and I understand why you might not -- to check out the report that the chart comes from, etc., and your reaction is to say that you assume something else. It is the ne plus ultra of your approach to polcy. Bravo, sir! Bravo, I say.

If I didn't have the chart and links, I would actually have assumed something different. I would assume that the schedulers for NY airports are fully aware of the size of the airports and schedule accordingly, and thus that any delays are the results of something else. Presumably there is great demand for slots at NY airports, but finite numbers of take-offs and landings, and this tension plays out with price or some other constraint on scheduling (depending on whether the airports are profit maximizing or give away scarce resources to airlines because of politics (in a non-partisan sense), etc.), or so I would assume. I would think that delays come from somewhere else.

But I do have the chart and the links, and you've made me curious, and it's easy enough to just take a look at the report. Page 20 says:

The cites are to a 2009 Brookings Institution report.

There have been such large strides in information technology in the last half-century that it seems pretty intuitive to me that a modern system would perform better, in terms of reliability, speed, etc.

But we have a Congress that does not seem to care about solving these problems, and is instead shutting down the FAA over a minor squabble about subsidies for rural air service and rules about how airlines can be unionized. (I'm sure that no one on this board thinks the subsidies are a good idea, and I'm sure we have predictable divisions over the union question. Both are distractions from the big picture.)

Re: My God, you are an idiot.
 

when trying to insult someone for intellectual laziness, you might be careful to avoid typographical errors.

Actually once you get an airport that is jammed full the domino effect happens once any plane is late at all. This chart is of the busiest airports.

The part you quoted was something I did read. It didn't say how technology would address the problem, or why the old technology causes the problem. I was simply asking how/why. I am an engineer; I can't simply accept people that say "trust me on this one."


The current congress that has been in control for less than a year is the reason the Nation's airport traffic control is among the worst in the World? I don't need to ask the how/why for that opinion. SMH

Re: My God, you are an idiot.
 

I didn't click the link either, and I don't really understand it (because, really, do I care about the particulars?), but my sources who spend their working hours in commercial cockpits say the technology is a big issue.

Re: My God, you are an idiot.
 

Duly noted. I don't believe I was trying to insult you, FWIW.

Yes. And the chart I posted reflects -- or so the authors say -- the leading reasons for those delays. It would be wrong to say that antiquated technology is responsible for all delays. Weather, for example, causes delays too. Which is why the chart reflects this, and the report provides a figure -- two-thirds, it says -- for the proportion of delays caused by antiquated air-traffic technology.

In your prior post, I failed to discern that you had unleashed your engineering acumen on this problem and found the facts insufficient, leaving you in this state of epistemological paralysis. In retrospect, it was the part where you said you "assumed" facts contrary to what was already posted -- that may have led me astray. (Apparently it is very easy for you to assume facts contrary to something I've posted, but very, very hard for you to learn enough to decide that the facts might warrant agreeing with me. I have noticed this in the past.)

I'm sorry -- I forgot that you would search for some possible hint of partisanship in a post and construe things accordingly, and so I wasn't clear. The problem is Congress, meaning the House of Representatives and the Senate, and it obviously is not just a problem since last November, not least since the air-traffic control system hasn't been replaced for decades before that. We have a Congress that is too focused on the parochial interests of particular members, including their most vocal and sophisticated constituents, and one that is not interested in or able to engage with national problems. And we have a Congress that is squeezing funding for investments that need to be made because of the ideology of a persistent and committed minority. The latter means that we do not spend enough on transportation and infrastructure, and the former means that we do not spend it well.

Re: My God, you are an idiot.
 

It's pity you can't google from your desk.

Here are pretty interactive pictures from Time (although they are more about improving routes, fuels efficiency and landings than delays).

Here's a guy saying you can handle more planes if you know where they are via GPS, and fun video from Reason (and the creepy Nick Gillespie).

ETA: Btw, this exchange reminds me of yesterday's conversation with a lawyer for the government. After a half hour discussion (featuring an actual electrical engineer, Hank) on how two things are technologically different and don't do the same thing, she says, "oh, one more question, are these things different or do they do the same thing." Talk about shaking your head.

EATA: Maybe it's a g-man thing? Once employed by the government, you are never again able to see what's blatantly obvious??

Re: My God, you are an idiot.
 

maybe it was the bit where you start wailing about funding for the FAA that caused me to think you were talking about the current Congress and the current house in particular. But you meant to imply past Congresses were bad, perhaps, as an example, since prior Congresses didn't provide perpetual funding or some other solution?

Re: My God, you are an idiot.
 

I'm going to gather some technical reports and study the question. Evaluate the strengths of the arguments and develop a modal analysis based upon certain expectations one could expect to be true if the hypothesis were accurate. Then I will report back to the board.

Re: My God, you are an idiot.
 

hoo boy. I generally feel government employees are overpaid, but if part of their job involves discussing technology with you for a half hour I would give they a grade scale bump, like you get for working in a war zone.

Re: My God, you are an idiot.
 

My understanding is that in a world without evolution or global warming, all the planes fly on time.

Re: My God, you are an idiot.
 

As I tried to just say, the problem is not just with the level of funding, but also with how the money is spent. Money gets spread around to places with legislative clout rather than spent where it is most needed. So we have flight delays in the busiest airports, and subsidies for flights to rural places no one wants to go. Seems to me that dynamic has much more to do with the Senate's disproportionate representation for large, empty states than it does with partisan politics. It probably doesn't help that Republicans don't represent cities in Congress. That means that transportation dollars will be skewed to highway projects in less dense areas.

But yes. A problem that this Congress inherited from earlier Congresses, and probably is making worse.

Re: My God, you are an idiot.
 

I'm a lawyer. If I'm doing my job right, my client is doing the talking. If I'm talking, it means either I can't control my frustration with the ridiculousness of the situation (which happens) or I've done a shitty job of prepping my client and it's time for evasive action.

After the intros yesterday, I think I spoke four sentences. I didn't do a shitty job of prepping my client, who knocked it out of the park.

Re: My God, you are an idiot.
 

not to be a timmy, but you said something biased, so I pointed it out, then in a follow up post said I always try to find something biased, and then you said something unbiased. I agree your second post said something unbiased.

Re: My God, you are an idiot.
 

I can buy into we killed the leader we were after when the helicopter was shot down. But there's a bit of the plot of Wag The Dog in getting the guy who fired the missile, no?