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For anyone who heard David Frum's "commentary" on NPR

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johnaries Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-17-08 10:17 PM
Original message
For anyone who heard David Frum's "commentary" on NPR
Marketplace, here is my reply that I sent to both "comments" and "commentary":

David Frum amazes me. In his latest commentary he somehow manages to blame market greed on the government.

This latest market fiasco should be the final nail in an economic policy that has failed many times, and yet he still argues to continue it.

So-called "trickle-down" or "supply-side" economics is based on the Austrian School theories that models, experiments, and even past experience cannot be trusted because of the "intricacies" of economics. Only "logic" should be trusted. This harkens back to "Chaos Theory" which originated in the world of Meteorology, and yet Weather Forecasters still use models and use past experience to improve their models. As a result, Weather Forecasting is constantly improving.

However, the Austrian School still adhere to the concept of "logic only" and then used flawed logic to support their pre-conceived views. If the realities prove them wrong, then they use even more twisted logic (as Frum does) to deflect the blame.

We need to return to consumer-based, "bottom-up", regulated and transparent free market Keynesian economics. It has been proven to work time and again. Unlike Austrian School economics which has failed time and again. Keynesian economics brought us out of the Great Depression. It softened subsequent recessions and brought unprecedented prosperity to the US. Even while Reagan pushed "Supply-side" economics, the Fed actually used "tweaked" Keynesian economics to bring us out of recession.

Despite the recent upheavals in the market, there will be some individuals and some companies that will profit greatly while the rest of us suffer. These are the ones that Austrian School Econ favors, not the National Economy. Not you and me.

Supply Side advocates maintain that the Supply Side "creates the jobs". That is not true, it is flawed logic. The laws of Supply and Demand dictate that no jobs are created unless there is a Demand. If consumers cannot afford a product, then there is no Demand, and hence no new jobs.

The Treasury Sec made an interesting statement, that he believes that regulation alone is not the answer, but a balance between regulation and Market Discipline. But, what is the best way to ensure "Market Discipline"? Regulation.

Whoever wins the Election, he must reject the failed policies of the laissez faire caveat emptor Austrian School and return us to "tried and true" Keynesian economics - "bottom up", consumer-based, caveat vendor, regulated and transparent "market discipline".

The government can't "fix" the problems, but they can keep them in check and could have avoided the problems that we have seen recently, if it hadn't been for the push for de-regulation.

The irony is that the result of the actions of these so-called anti-Socialist "Free Market Capitalists" has resulted in the closest thing to Socialism that we have seen, in the form of these government "bail-outs".

Government regulation is not Socialism - it protects Capitalism.

PS, I am not an economist, I just know how to use "The Google".
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Hestia Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-17-08 10:21 PM
Response to Original message
1. K & R - thank you for summing it up for me and everyone else!
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lutherj Donating Member (788 posts) Send PM | Profile | Ignore Wed Sep-17-08 10:34 PM
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2. I don't think anyone really believes that supply side economics works.
It's just a rationale for cutting taxes for corporations. Papa Doc Bush called it voodoo economics. It was tried twice, under Reagan and George W. Bush, and we twice got the same catastrophic results.
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spag68 Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-17-08 11:07 PM
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3. socialism
I fail to see what is so wrong with socialism, except that it is not radical enough to contain the thieves that have invaded our govt. The cure is a Marxist revolution of workers banding together to get a fair share of the wealth created by their labor. This will not fly here as greed has been promoted as the way to go. What ever happened to helping your neighbors, and sharing wealth? How could so many be deluded into a voting pattern that clearly harms the majority of people, and benefits the few?
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RagAss Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-17-08 11:12 PM
Response to Reply #3
4. ...and it needs to start with this....
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