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American Fundamentalism

July 15th, 2010 · 2 Comments

Scary, really scary those who regard themselves as staunch defenders of an open society have to resort to such fundamentalist methods..
We made some remarks at the end of a pretty dodgy article (and really were mild, we could have torn the thing apart but it was hardly worth our time), look at the responses..

by OldTrooper
on Thu, 07/15/2010 – 11:33
#471225

That’s got to be the dumbest post I’ve ever seen on this forum, maybe the whole internet.  We’re all more stupid for having read it.

Do you work for the Fed?  Are you a Fed economist, with a PHD?

You are a waste of time.  Too bad this will show up underneath your post – so innocent people will not be warned to avoid this drivel  – and the subsequent mind-numbing effects.

What exactly are the ‘long-term returns’ and ‘numerous external benefits’ of having a huge number of high school graduates that can’t read a newspaper and whose math is limited to how many grams in an ounce and how many ounces in a quarter-pound (but can’t even get a cashier job because they can’t make change)?

by stpioc
on Thu, 07/15/2010 – 11:41
#471268

If I am a waste of time then why respond?

So, according to you, education serves no purpose, has no return? Or has it only a return if it’s private education? Enlighten us.

Couldn’t detect another argument, which is typical of a ‘true believer’ who can’t argue with facts and arguments and instead starts name calling (I know, in your circles it’s bad to work for the Fed or have a PhD in economics..)

Explain to me: if business isn’t investing when they have large capacity underutilization, facing weak end demand, and even in the face of record low interest rates (like now), how are they suddenly going to invest if end demand is even lower (because “savings is good”, according to The Daily Capitalist) and facing higher interest rates?

Have you guys ever heard of balance sheet recessions? Deflationary debt spirals?
Here’s a primer:
https://shareholdersunite.com/2010/07/04/keynesianism-zerohedge/

by OldTrooper
on Thu, 07/15/2010 – 12:11
#471384

I respond out of charity – because even someone as obviously mal-educated, misinformed and reality-challenged as you should have a chance to experience a moment of clarity (not that I think you will).

The answers you seek are contained in the writings of Mises and Hayek.

Or you could, as I suspect you will, continue to rely on the theories you studied in your youth (theories that have yet to produce the end they claim to strive for) and religously keep faith with central planned economies (whose main claim to fame is hundreds of millions of dead).

by stpioc
on Thu, 07/15/2010 – 13:04
#471595

Thanks for the charity.

Again I see no arguments, just name calling.

Yes I’ve read Hayek, I’m even on record that his 1945 article about the role of knowledge in society is the most important economic publication of the 20th century.

But I’m not a socialist, let alone a believer in planned economies. How you could ever deduct that from the two comments I wrote is, well, only you can answer that.

Could it be because you think that everyone who disagrees with your divine (uhh, Austrian, sorry) truth must necessarily be a socialist in favour of a planned economy?

I’m every bit as much a free-marketeer as you are, minus the blind faith in them and an open eye for instances in which they fail. Ever heard of information asymmetries? These lay at the heart of the crisis:
https://shareholdersunite.com/2009/03/30/government-captured-by-big-finance/
http://seekingalpha.com/article/96766-it-s-time-to-break-the-bubble-cycle

I just laugh at people who respond to argued criticism by referring to some canonical work (even being too lazy to spell it out). You know, that’s EXACTLY what they used to do in the old Soviet Union..

Turns out the socialist is not me, you’ve mastered their methods, including the name calling for heretics..

by stpioc
on Thu, 07/15/2010 – 11:47
#471302

Sorry, forgot this:

[“There is a strong consensus among economists that formal education is an important determinant of individual earnings as well as economic growth. The importance of formal education has been magnified by recent economic trends underlying U.S. labor market demand for skilled workers. The following is a review of the importance of education to both the individuals acquiring education and of the benefits received by society resulting from increased educational attainment.”]
http://www.house.gov/jec/educ.htm

Your “argument” seems to be that education (in the US) has produced bad results, citing people with limited math and all that..

My question: How would the results be without education? Better or worse..

That should be a difficult one.. 🙂

by OldTrooper
on Thu, 07/15/2010 – 12:21
#471427

Just because the gov’t schools did such an obviously fine and thorough job of indoctrinating you does not mean that is the only way to become educated.

Your assumption that without gov’t schools we would have no education at all is preposterous.

by stpioc
on Thu, 07/15/2010 – 13:06
#471605

Apart from the fact that I didn’t make that assumption..

Ah, because I disagree with you, I must have been indoctrinated. Beats arguing with someone. It’s what the communists used to do, then they send people who disagreed with them to re-education camps..

———–[End of exchange (for now)]————-

In summary:

1) No rational debate necessary
We make some arguments against some, in our view, pretty defunct and unsubstantiated reasoning, we’re greeted not by facts and arguments, but by name calling. Somehow, we’re “socialists, in favour of a planned economy, maleducated, misinformed (it’s even deemed suspect to have a PhD in the context of an economic debate or how that equals to being maleducated remains a mystery), etc. etc.

2) Invoking an absolute truth instead
Why bother arguing with data, facts and arguments when one is privy to the absolute truth. The OldTrooper just refers us to some canonical work. It’s absolute truth is self-evident and doesn’t need demonstrating. How, even if Hayek constitutes some form of absolute truth, how would OldTrooper (or anyone else) be able to ascertain this?

Under the present economic circumstances we could be considered mild Keynesianists (certainly no socialists) but we certainly do not argue his work is the source of all wisdom, let alone the sole source of it. In the Soviet Union, many debates used to be settled y reference to some canonical work (Marx, Lenin, Stalin..). Fundamentalist Islam (or other religions) do the same.

3) Demonization of heretics
From just a few innocuous comments, we’re turned into “brainwashed, religious believers of some theories we studies in our youth.” It doesn’t even need to be established that we’re actually followers of these theories (which most certainly we’re not).

So we’re branded socialist by some guy who doesn’t respond to rational debate, referencing us to some absolute truth, without there being a shred of evidence of us being socialists.

Now change “Hayek” (his form of absolute truth) for (“Das Kapital”), who turns out to be the socialist (at least in methods?

This would be laughable if not for the fact that we’ve experienced this kind of exchanges quite frequently. American fundamentalism is definitely on the rise. It’s scary to see those who consider themselves to be staunch defenders of free societies resorting to such fundamentalist methods…

Tags: Public Policy

2 responses so far ↓

  • 1 satchmo // Jul 26, 2010 at 10:03 pm

    STP,

    Your exchange is certainly disheartening and I commend your restraint and continued attempts to engage in debate and discourage the blather and vitriol of your dogmatic adversary.

    With that said, I have often wondered (and occasionally commented) how you might reconcile your “mild Keynesianism” with your views on global energy (based on numerous posts over the years, I take you to be “peak (oil) aware” and judging by the rigorous intellectual standards evident in your analyses on this site, thus aware that whether PO occurred in 2005 (as some argue) or it happens in 2025 we are decades late in the nearly unfathomable undertaking of finding a sustainable balance to power civilization as Asia aspires to enjoy a Western lifestyle and grows her economies (perhaps exponentially) in the coming decades, while the rest of us keep the lights (and the AC on)).

    Specifically:

    1. Do you observe a fundamental relationship between money and energy in our current system(s) (whatever one might call such a system(s)?

    2. Do global energy constraints call into question steady/endless economic growth as we currently measure it?

    3. If so, aren’t the current staggering sums aimed at a Keynesian style economic recovery merely kicking the can of energy constraints down the road when it will in fact be even more difficult to transition without major disruptions to our current way of life?

    Other than Denmark, I know of no examples of economic growth occurring without a corresponding increase in fossil fuel consumption.

    So if all of the stimulus money were to curtail and end stagnated economic growth, we would find it would in fact be speeding us towards supply disruptions of the very fuels that are necessary to sustain economic growth. While simplistic, this Catch 22 seems to be a strong counterargument to a Keynesian approach.

    Do you agree, or perhaps have another take on the first question that might alter the dynamics between economic growth/money/energy?

    Your thoughts would be appreciated, and thanks as always for being such a valuable resource.

    Satchmo

  • 2 admin // Jul 27, 2010 at 4:20 am

    Thanks Satchmo. Some fundamental questions there which are not easy to answer, here an effort:

    1) The relation is between economic growth and energy use, the relation between money and economic growth has broken down (which is called a liquidity trap). We believe economic growth is becoming less energy intensive and the Chinese have embarked on a massive investment spree in alternative energy, which helps (a bit).

    2) At some point, probably yes. When is impossible to say even for the specialists, let alone us..

    3) Well, if the alternative is no economic growth, that strikes us as not very attractive. We believe there is a win-win possibility: invest massively in alternative energy, which will stimulate economic growth and make it less energy intensive. Also, put a right price on fossil fuels (which is way to low in the US through all kinds of subsidies and external effects), markets can be great instruments. Once priced right, it sets in motion powerful incentives to look for alternatives, tapping into the expertise and ingenuity of a myriad of brains..

    Germany has very good energy policies as well (their solar initiative is a role model now widely copied), we’ve actually written about that here quite a bit.

    Hope it helps, good luck!