Krugman Can't Admit He Was Wrong on Austerity: Lat

GURPS

INGSOC
PREMO Member
Krugman Can't Admit He Was Wrong on Austerity: Latvia PM


Latvia's Prime Minister hit back on Friday at Paul Krugman's criticism of Latvia's austerity measures, saying the Nobel Prize-winning economist has "difficulty admitting his own mistake."

"Krugman famously said back in December 2008 that Latvia is the new Argentina, it will inevitably go bankrupt, and now he has difficulty apparently admitting he was wrong and so he tries to seek some problems in how Latvia is recovering from the economic crisis," Latvian leader Valdis Dombrovskis told CNBC in an interview at the EU summit in Brussels.

"But I think that the mere fact that for the last two years we are enjoying rapid growth shows that it was probably the right strategy."

Latvia's government undertook a heavy dose of austerity after a credit boom led to an economic crash in 2008. The government undertook the biggest fiscal adjustment drive of any country in the European Union and gross domestic product (GDP) plunged 24 percent in 2009.
 

tommyjo

New Member
Krugman Can't Admit He Was Wrong on Austerity: Latvia PM


Latvia's Prime Minister hit back on Friday at Paul Krugman's criticism of Latvia's austerity measures, saying the Nobel Prize-winning economist has "difficulty admitting his own mistake."

"Krugman famously said back in December 2008 that Latvia is the new Argentina, it will inevitably go bankrupt, and now he has difficulty apparently admitting he was wrong and so he tries to seek some problems in how Latvia is recovering from the economic crisis," Latvian leader Valdis Dombrovskis told CNBC in an interview at the EU summit in Brussels.

"But I think that the mere fact that for the last two years we are enjoying rapid growth shows that it was probably the right strategy."

Latvia's government undertook a heavy dose of austerity after a credit boom led to an economic crash in 2008. The government undertook the biggest fiscal adjustment drive of any country in the European Union and gross domestic product (GDP) plunged 24 percent in 2009.


A 24% 1 year decline in GDP. Teachers salaries cut by 70%. 13% more people leave the country. Unemployment estimated at 14.8% (CIA World fact book). $9.9 billion dollar loan from the IMF (that is 25% of the entire country's estimated GDP!)

And the leader of the country thinks a 5.5% growth rate last year and 10% raise for teachers are signs of stunning success??? At that rate it will take teachers 13 more years for teachers to make the same amount of money they were making in 2008...and it will take 6 more years before the country's GDP equaled what it did in 2008.
 

FreedomFan

Snarky 'ol Cuss
Krugman isn't "wrong". It's just that there are two competing versions of austerity; we're dealing with apples and oranges here.

In Latvia, it means making sure that government expenditures don't exceed receipts. If services need to be cut, then so be it.

In the Krugman/Keynesian view, it means to hell with expenditures and receipts. Just keep doing what you're doing and cut services and instead make sure the bankers and Goldman don't go hooters up.
 

GURPS

INGSOC
PREMO Member
on cannot keep borrowing and spending, borrowing and spending ....


sooner or later you run out of money to confiscate with taxes ...


it does not work in this country, because in times of plenty, instead of paying down the debt ... i.e. keeping spending levels the same, progressives spend EVEN MORE with MORE Social Programs ....


one might get more converts, be Progs NEVER Quit wanting to spend MORE and MORE Money

how many programs do we need in this county for lazy people
 

SamSpade

Well-Known Member
Austerity does not work. End of discussion.

Brilliant argument.

If the alternative is Greece - where there ARE riots, because of bankruptcy and wasteful overspending - then we are all doomed, because either we cut spending or go bankrupt, sooner or later.
 

SamSpade

Well-Known Member
it does not work in this country, because in times of plenty, instead of paying down the debt ... i.e. keeping spending levels the same, progressives spend EVEN MORE with MORE Social Programs ....


If you chart the amount of government spending versus receipts, you find that government spending grows at a steady rate - PERIOD. The largest reason why the deficits are so large now is the tanking economy - federal receipts were the largest in 2007. They've been lower ever since. The reason we have such a great DEBT is that spending has consistently grown faster than receipts taken in.

The problem about running deficits every year is, there's no way to catch up when the economy goes bad for several years, because no one wants to match the amount of spending to the amount of money taken in.
 

FreedomFan

Snarky 'ol Cuss
on cannot keep borrowing and spending, borrowing and spending ....


sooner or later you run out of money to confiscate with taxes ...


it does not work in this country, because in times of plenty, instead of paying down the debt ... i.e. keeping spending levels the same, progressives spend EVEN MORE with MORE Social Programs ....

Even Keynes would have said to pay down debt in the good times. That wasn't done, no matter how hard the Clintoon apologists try and convince you otherwise.
 

Larry Gude

Strung Out
on cannot keep borrowing and spending, borrowing and spending ....


sooner or later you run out of money to confiscate with taxes ...


it does not work in this country, because in times of plenty, instead of paying down the debt ... i.e. keeping spending levels the same, progressives spend EVEN MORE with MORE Social Programs ....


one might get more converts, be Progs NEVER Quit wanting to spend MORE and MORE Money

how many programs do we need in this county for lazy people

Ah, but, this is the question, the argument, THE debate.

Obviously, debt is meaningless in the US in two ways; one, we just keep doing it so, we CAN keep doing it and, two, it does NOT work IF the goal is liberty, freedom and independence.

We are building an indentured society. Teachers are devastatingly dependent on the state as are more and more of us. Social Security, food stamps, unemployment benefits, health care. We have no savings to get over tough times. Our government sees to it by destroying the value of the dollar and punishing thrift and savings. You MUST participate. Look at Obamacare. Look at TARP. Look at the bailouts, the Stimulus.

This is the success of the 'progressive'; step by step, more and more government to the point where the people can NOT see a way, any way, to slow down, let along stop, let alone freeing ourselves from our government.

Obama's world, Bush's world, the new world order, it works if you simply centralize more and more as conditions dictate. That's all Krugman is saying.

One of the many things we, the people, don't understand about TARP is that it wasn't even about the US; it was a global issue. We, Bush, Obama with Dodd/Frank, weren't trying to save Main Street, obviously, and really not Wall Street per se. They were trying to save the new world order and that order is predicated on Too Big To Fail and Too Big To Fail is predicated on individual dependence on centralized control, planning and power.

:buddies:
 

FreedomFan

Snarky 'ol Cuss
Brilliant argument.

If the alternative is Greece

Nope. Not even close. The difference is, for better or worse, we still have control over our own currency. The Greeks do not. The problems you describe, while they do exist, are not the whole story.
 

SamSpade

Well-Known Member
Even Keynes would have said to pay down debt in the good times. That wasn't done, no matter how hard the Clintoon apologists try and convince you otherwise.

That's the problem with modern supporters of Keynesian economics - they forget this part. They spend in times of want, and spend MORE in times of plenty.

I don't get the President with regards to the debt - he sounds like the lady who says "I can't be broke - I still have checks left!". You can't think debt is ok because you can keep paying the minimum payment - and you still have credit cards.

How can we be borrowing 40 cents on the dollar every year - and that's ok?
 

SamSpade

Well-Known Member
Nope. Not even close. The difference is, for better or worse, we still have control over our own currency. The Greeks do not. The problems you describe, while they do exist, are not the whole story.

The best way to look at it is the compare Latvia, with Greece. One took the austerity route, and they are recovering. The other didn't, and even with bailouts and assistance, they're still sinking.

Why Austerity Works and Stimulus Doesn

German austerity also worked.
 

GURPS

INGSOC
PREMO Member
Even Keynes would have said to pay down debt in the good times. That wasn't done, no matter how hard the Clintoon apologists try and convince you otherwise.



:buddies:


Yes That was MY Point ........

... Progs are only half Keynes ...... they want to spend spend spend, constantly borrowing
 

GURPS

INGSOC
PREMO Member
The best way to look at it is the compare Latvia, with Greece. One took the austerity route, and they are recovering. The other didn't, and even with bailouts and assistance, they're still sinking.


oh no it only works it you want RIOTS and people leaving the country

:sarcasm:
 

FreedomFan

Snarky 'ol Cuss
:buddies:


Yes That was MY Point ........

... Progs are only half Keynes ...... they want to spend spend spend, constantly borrowing

Also don't forget this is ALL PhD economists coming out of MIT, UChicago, etc. know. This is the prevailing philosophy.

Thank god my daughter is at George Mason studying economics under proper Austrian tutelage.
 

GURPS

INGSOC
PREMO Member
Also don't forget this is ALL PhD economists coming out of MIT, UChicago, etc. know. This is the prevailing philosophy.

Thank god my daughter is at George Mason studying economics under proper Austrian tutelage.

Oh Cool .......



these PHD Econs' that never worked in a real JOB ?
 
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