Paul Krugman (Even More) Unhinged

The beauty of being a Keynesian is that one can never be proven wrong. Paul Krugman explains why the real problem with the economy is that the government is not spending enough and should spend, spend, spend because only the government can save us from disaster. What happens if the government listens to Krugman and we travel even further down The Road to Serfdom while the economy implodes even further? If you are Krugman, the obvious answer is that you didn't spend nearly enough. "If only you would have listened to my wisdom," he will say, "we could have been saved."

Krugman's theory has been tried before. In France. Read the (free) ebook Fiat Money Inflation in France to see where that ended. Government stimulus at first appeared to work great (sound familiar) then, like gasoline on a fire the effect died away. What to do? More stimulus! This also appeared to work (only for a shorter amount of time), then, guess what, no more gasoline. More stimulus! Even less effective. On and on it went until the government collapsed and Paul Krugman - oops, I mean William Law, author of the grand inflation - was run out of France. This is where Krugman's theories would lead us.

Of course, since Mr. Krugman has a nice house on a Caribbean island and spends his days drinking Mai Tai's on the beach while telling us how to destroy ourselves, he probably will not mind being run out of the country.

The Illustrated Road to Serfdom

I've linked this before, but since it's becoming every more pertinent as the days pass by, I'm linking it again. Do you want to see where we are headed? Right down the Road to Serfdom.

Federal Government Turns into California

Leave it to Jennifer Rubin to speak the truth (must read). We've got two ways (actually three) to pay for the idiotic bill that just passed the inept, cringing, cowardly Congress. We can raise taxes ($8500 per year to cover a one trillion deficit), or we can cut spending (yeah, like that is going to happen). The only other way out is to print money to pay for it. Who knew any political entity could be as equally fiscally irresponsible as California?

But the options are clear: radically cut benefits or radically raise taxes. There is no mysterious solution to “assuring” social security’s future or to narrowing the budget gap. The problem was daunting before and we have now made it much worse, because we have widened the chasm between receipts and spending and because the large stimulus bill and increased debt, as CBO predicted, will likely slow economic growth.

Watch for politicians to be shocked, shocked! when their policies further slow/depress the economy, and then watch as they turn to a hodge-podge of regulations (price controls) to attempt to change things (all the while making them worse). The rest of my working life (if not the rest of my life) is going to be VERY interesting as we march down The Road to Serfdom.

A Day That Will Live in Infamy

Yesterday, October 3, 2008, a day that will live in infamy, our (idiotic) congressman handed off to the executive branch even more power than they've already allowed President Bush to grab in the past eight years. These are simply more steps down the Road to Serfdom. Thanks so much Congressmen.

CNET has a good summation of the mess that this bill is, which included more power for the IRS to snoop on Americans in the name of "terrorism." Didn't hear about that, did you? Let's see, I think we've experienced this before. Oh yeah, The Patriot Act.

As noted by CNET the true cost of all of this mess so far is somewhere around $17,000 per American household. The Treasury Department can now "guarantee" home mortgages (i.e. make the taxpayer pay for other's foolish decisions) and even reduce a mortgage a "reasonable amount" if it so chooses. So much for ten centuries of contract law, vaporized by cowards. Oh, and former Goldman Sachs CEO Henry Paulson can come up with "appropriate standards" of executive pay for companies that dump their toxic waste on us. Yeah, I'll bet he will reign in their pay.

Nice to know that King Paulson will implement this bill as quickly as possible. I'll bet there won't be any fraud waste and abuse in that!