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Friday, April 27, 2012

The First GDP Report of 2012

The first quarter of 2012 GDP report is in and the initial estimate (there are two more to follow) speaks volumes.  US growth was at 2.2 percent. Of course, how you interpret this depends on whether or not you are a half full or half empty kind of person.

Any growth of 2 percent is good but with unemployment still over 8 percent that simply isn't enough to significantly bring the later number down. The good news is that this result suggest that the economy will continue expand into the year with analysts predicting 3 percent growth throughout the year and that will bring the unemployment rate down.

More importantly, this growth has been fueled by consumer spending which accounts for 70 percent of economic activity. It's also important to note that this marks the 11th straight quarter that the economy has expanded since the Great Recession of 2007-2009. This coincides with the election of President Obama so to say that he is "destroying the economy" is simply wrong when you consider these numbers. That also doesn't mean he's done an absolutely perfect job either. It simply means he's done the best he could given what he was handed and considering the mistake that was made in estimating how deep the recession was back at the time. In other words, a good (not poor or amazing) job.

Oh, and then there's this.

All levels of government are under pressure as they struggle to control budget deficits. Government spending fell at an annual rate of 3 percent in the first quarter.

But wait! I thought that when government cut spending, that would spur growth. Oh well, I guess not.

THE WEIGHT OF GOVERNMENT-Government spending cuts are weighing on the U.S. economy in a way that hasn't been seen in generations. Those cuts have reduced growth for six straight quarters - the longest stretch since 1955.Reduced government spending subtracted 0.6 percentage point from the first quarter's growth. Fortunately, the drag may decline the rest of this year. Defense spending fell sharply in the past two quarters, which isn't likely to continue. And state tax revenue is recovering, closing budget gaps."It's hard for the economy to accelerate when the government has its foot on the brake," said Joel Naroff, president of Naroff Economic Advisors.

This is why I have zero respect for right wing economic advice. It's simply wrong.

Some other notes from this report...

Many economists predict growth will strengthen in the second half of this year because they think hiring will continue to improve. Job growth has helped drive the unemployment rate to 8.2 percent in March from 9.1 percent in August and given households more money to spend.

That's good news for the president. If the unemployment rate drops below 8 percent, it is very likely he will win re-election.

Consumers this year have reduced their debt loads. Housing is inching back. State and local governments aren't cutting as much. Banks are lending more. And the threat from Europe's debt crisis has eased somewhat.

But no! The world is still ending!!! It has to be!!!

I'm nearly certain that the right will jump on this and spin it to be horrible and Armageddon-like but I guess I don't see how above 2 percent growth can be a bad thing. You certainly can't call it amazing but it's definitely good considering the external factors of 2011 some of which were simply unpredictable.

53 comments:

Haplo9 said...

Hypothetical: The govt borrows 1 trillion dollars. It then spends this 1 trillion dollars buying #2 pencils. As a result:
- GDP grows by at least 1 trillion
- employment is stimulated in a number of sectors, most likely manufacturing and mining

The question is - does it add to our economy to buy a trillion dollars worth of pencils? Will we be better off? Near as I can tell, your answer is yes. Again, near as I can tell, anything that makes GDP go up or unemployment go down is a good thing to you. Is that correct? If your answer is no, why?

Mark Ward said...

Seeing growth now is a good thing considering the current economic climate. If the economy was doing very well, growth could possibly be a bad thing due to inflation. It depends on how much and how quickly the growth occurs.

Unemployment going down now is a good thing because it will help boost consumer spending (70 percent of our economy). Simply having unemployment isn't necessarily a bad thing, though, when you consider if there is a shortage of labor, businesses lose money. Having an unemployment rate of around lower than 4 percent brings with it these types of issues.

As far as the government goes, whether you want to admit it or not, they are a key player in our economy. When they spend less, there is less growth. Now, that may be a good thing if we are trying to reduce debt and deficit but that also means that sacrifices (like growth) are necessary.

Anonymous said...

As far as the government goes, whether you want to admit it or not, they are a key player in our economy.

Government shouldn't be a player, it should be the referee.

Haplo9 said...

You didn't answer the question. Would 1 trillion dollars worth of #2 pencils, and the GDP and employment increases that comes with purchasing them, be a good thing for our economy or not? Lets assume for the sake of argument that inflation is not an issue.

You general response was "growth is good except if inflation is a problem" - so.. your answer is yes? I'm trying to figure out, if it isn't clear, whether you make any distinction about what it is in the economy that is growing and why. Near as I can tell, you don't (except for the caveat about inflation.)

Mark Ward said...

You didn't answer the question.

...the way you wanted me to answer the question. Oh well. It's a bully weasel question, Hap. I don't answer those anymore.

It's also a yes or no question and, when it comes to economic matters, there really aren't any of those nor should there be.

Growth is generally good when we are in the situation we are in now as it leads to jobs which, in turn, leads to increase consumer spending which makes for a healthier economy. As the article aptly notes, if we hit 3 percent growth for the rest of the year, our economy will go from being sluggish to moving again. And unemployment will likely go down.

It seems to me that you have some sort of concern about the nature of the growth. If so, please be so kind as to state what it is and why you think it's bad.

Haplo9 said...

And skipping by the first two paragraphs of avoidance strategy..

Mark. You've told us how important GDP growth is. You've told us how important getting the unemployment rate down is. I presented you with a hypothetical which makes both those things go in the direction you prefer. If inflation isn't a concern, what consideration makes you hesitant about saying that hypothetical is a step in the right direction for the economy? Is there some consideration beyond inflation, GDP, and the unemployment rate?

>It seems to me that you have some sort of concern about the nature of the growth.

I do, but that's irrelevant - I'm asking, and have been asking, whether *you* have any concerns about the nature of growth. Again, based on what I know of you, your answer would be, for the most part, no. Feel free to tell me how what I know about you is wrong.

Mark Ward said...

The bottom line, Hap, is that your question is both obnoxious and juvenile. Further, it also lacks depth, economically speaking. It can't be answered in and of itself without further illustration.

First, one has to look at the state of the economy i.e. when the question is being asked. Are we in a recession? Or worse, a depression? If so, the answer is yes. If not, the answer is no. If the economy is doing well, there's no need to spend a trillion dollars for growth and to reduce unemployment.

And what about our debt and deficit? At present, I think the downside of spending that amount of money would be detrimental. Of course, that doesn't mean we should stop spending all together because, as Mitt Romney has aptly noted, "we can't cut our way to growth."

Further, if your question was posed in today's economic environment, I would say no. This where Krugman and I would part ways. The economy is recovering right now (albeit slowly) and the government involvement in it (including current spending levels) is entirely appropriate given the other factors such as debt and deficit.

You really have to stop assuming that my views conflicting with your intransigence immediately means that I'm an idiot. I realize that's the right wing blogsphere's ground in stone version of anyone to the left of the 1 yard line on the right side of the field but it's simply not true.

So, sounding like a never ending broken record, make your point and support it with evidence regarding the nature of growth. Honestly, you should have just done that in the first place rather than resorting (again) to the bully weasel games.

Haplo9 said...

>lacks depth, economically speaking

(Excuse me while I wipe away the tears of laughter, on the thought of you complaining about "depth".)

>make your point

Wasn't making one. Was just trying to clarify your beliefs. (Dude - was it that hard?) I had long suspected it was the case but each time I asked you responded with avoidance. Anyway, thanks.

6Kings said...

Just like the unemployment numbers, the real GDP is more government manipulation. Expect a downward revision of this projected amount.

Mark Ward said...

That's entirely possible, 6Kings, as there are 3 separate readings as I noted.

Hap, you make it hard with the infantile games. I know it's going to be hard for you and some of the others from Kevin' site to admit it but I have above average intelligence and knowledge in this and other areas. That doesn't mean that I'm an ONYX level expert but it does mean that the ol' "useful idiot" chestnut isn't going to cut it anymore.

So, for future reference, I'm more interested in evaluative and analytical discussions and questions that call for synthesis of knowledge and how that is applied in reality.

Haplo9 said...

>Hap, you make it hard with the infantile games.

Oh I know Mark. Since you define "infantile games" to be identical to "questions that Mark doesn't like answering because he thinks they are mean.", I can see why it would be tiring for you. It always has been with you - you seem to believe that explaining your beliefs to hostile questioners is something akin to having toenails extracted. Which has always been curious, considering you are a teacher. Though in your case, entirely understandable.

>I have above average intelligence and knowledge in this and other areas.

Well, I'll give you this: I think you have above average ability to put buzzwords and jargon together to make yourself sound intelligent to those who don't try to unpack the verbal diarrhea you spew, and above average ability to trawl the web searching for articles that you think reinforce your viewpoints. Faint praise I know, but you know what they say about poeple who go around telling people how intelligent they are.

Mark Ward said...

Since you define "infantile games" to be identical to "questions that Mark doesn't like answering because he thinks they are mean.",

No, I define infantile games as asking questions that lack intelligent thought with the specific intent of weasel. And you're not really up for a discussion (either for lack of knowledge on your part, simple laziness or something else). Just the weasel grilling.

I think you have above average ability to put buzzwords and jargon together to make yourself sound intelligent to those who don't try to unpack the verbal diarrhea you spew,

This is essentially a description of what you have said in this latest comment. No serious economic analysis or thought. Just more obsessive comments about yours truly. Is it so hard to admit that I have this knowledge? Sadly, I guess it is.

I'm always around when you are ready to be serious, Hap.

juris "bully weasel" imprudent said...

Is it so hard to admit that I have this knowledge?

You could not prove the old adage about a little knowledge more perfectly if you tried.

Haplo9 said...

>No, I define infantile games as asking questions that lack intelligent thought with the specific intent of weasel.

That statement implies that you possess some means to judge whether thoughts are intelligent. Heh. I have to ask though: "intent of weasel"? Lol. What does that even mean? Some of the avoidance strategies you use dude - I'm not sure you even know what they mean, you just reflexively throw them out there.

>This is essentially a description of what you have said in this latest comment. No serious economic analysis or thought.

Its true that we have gotten to that point, but you seem to be studiously avoiding your role in getting us here. If you had simply answered a straightforward question about your economic beliefs without your little fainting couch routine, it wouldn't have gotten here. (And dear god, this happens every time. Why didn't you just respond in your first comment with "yes, but not in these particular situations?") Admittedly, I shouldn't encourage you by responding to your antics, but I admit - its kind of fun to watch Mr. wannabe sober objective analysis furiously wave his arms and fart out smoke.

GuardDuck said...

No serious economic analysis or thought. Just more obsessive comments about yours truly. Is it so hard to admit that I have this knowledge? Sadly, I guess it is.


Why the hell should he? You won't even bother to explain in detail your supposed analysis and thoughts. All you spew is is crap and not even specific crap. Your crap is full of vague assertions and obscure conclusions.

And yeah - you seem to believe that explaining your beliefs to hostile questioners is something akin to having toenails extracted.

I will second that thought. If you can't or won't explain your beliefs and or thoughts - then they have no merit.


I'm always around when you are ready to be serious, Hap.

What you can't understand is that it was a serious question. Just because you can't grasp the underlying fault in the basis of your conclusions does not make the simplicity of the question indicative of triviality.

Mark Ward said...

That statement implies that you possess some means to judge whether thoughts are intelligent.

I'm a pretty self aware person, Hap. I recognize my limitations and faults as well as my strengths. That's part of being reflective.

What does that even mean?

It means that you are attempting to create, through your weasel questions, a perception that I don't know what I'm talking about in regards to some of the topics we discuss. They aren't serious, evaluative questions (the hows and whys). Just childish ones with no real depth. It's what you guys did all the time on TSM. I used to fall for it. No longer.

If you had simply answered a straightforward question about your economic beliefs without your little fainting couch routine, it wouldn't have gotten here.

I did. Again, not in the way you wanted me to do so. You (and some others) seem to have a real problem when the answer to a question is both yes and no. Having such a stark view of the world is terribly ill-suited to accomplishing most things in this day and age. Although I can't say for certain because I don't know you personally, I suspect this has caused you some problems along the way.

its kind of fun to watch Mr. wannabe sober objective analysis furiously wave his arms and fart out smoke.

And there it is. Usually when I see something like this, I just put it through my right wing blog translator into English and get out the truth: Mark knows what he is talking about, this sucks, now I must make fun of him as I have nothing substantive to say in response. Honestly, if you stop and think about it, I'm doing you guys a favor. There likely aren't many people left who will listen patiently and engage folks with views of the world such as you have. No one really reads these sorts of comments save for me and a few of you, you know:)

I find it very telling that vast majority of what you have written in this thread has been about me. Still nothing much in the way of serious economic discussion. It more or less proves my point, wouldn't you say? Tomorrow is the start of a new month. Let's see if you can go the entire month of May without the over analyzing or making personal comments about me. Stick to the evidence and refute with data and facts.

Can you do it?

Mark Ward said...

You won't even bother to explain in detail your supposed analysis and thoughts

Nope, not true. Did it above.

All you spew is is crap and not even specific crap. Your crap is full of vague assertions and obscure conclusions.

See my comment above about the right wing blog translator:)

What you can't understand is that it was a serious question.

Not really. It was an exaggerated and obnoxious view of what Hap perceives to be Keynesian thought...government spending always good-YAY! That sort of thing...

Just because you can't grasp the underlying fault in the basis of your conclusions does not make the simplicity of the question indicative of triviality.

This is a great example of what I am talking about when I say that you guys don't actually make points-just personal insults. HOW is their an underlying fault? Where exactly is it? And what is your evidence to support this? By making a claim like this without any sort of depth in explanation, it demonstrates that you likely don't really know of what you speak. Only that you don't like me and I can never be allowed to win.

What a drag, dude.

GuardDuck said...

OK,

One of the underlying faults of your position is that you assume that just because government spending is currently part of the economy then that means any increases to it is good for the economy and cuts to it are bad for the economy. You never even question what the spending is - whether it is productive or wasteful - you simply look at the money that is spent by the government as an influx to the economy. Without also looking at the harm done to the economy by taking that money from actual producers you cannot and have not been reflective. You are not acting like a smart dude. And you are a drag.

Further - since you refuse to answer clarifying questions to specify you position - then if you disagree with my take on your position then you can fuck off - you had the chance to make it clear.

Mark Ward said...

is that you assume that just because government spending is currently part of the economy then that means any increases to it is good for the economy and cuts to it are bad for the economy.

I made it clear above that I do not think this at all. Increase government spending can indeed be bad for the economy. I don't think we should increase spending now. Nor do I think increased spending is good when you are trying to manage debt or deficit more effectively. It's also not a good idea (generally speaking) to increase spending when GDP is growing rapidly due to possible inflation issues. So, there are three examples (all of which I talked about above) where increased government spending could be detrimental.

My point in bringing this up in the original post was to point out that spending cuts don't automatically mean growth. In fact, they mean they opposite, given how integral the government is to the economy. But that's a pill we are going to have to swallow now given the other, external factors that could be detrimental if we increase spending.

GuardDuck said...

given how integral the government is to the economy

THAT


Right there.

Why?

What on earth makes the government integral to the economy other than the fact that they currently leach trillions of dollars out of it?

Haplo9 said...

>I'm a pretty self aware person, Hap.

I know you believe this is so - but I disagree. You are among the least aware people I've ever interacted with. Not that that is terribly relevant to anything - it is axiomatically true that no one person is equipped to be the arbiter of what is and what isn't intelligent. You are certainly entitled to your opinion though.

>It means that you are attempting to create, through your weasel questions, a perception that I don't know what I'm talking about in regards to some of the topics we discuss.

Newsflash: That perception of you not knowing what you are talking about is already well established already among just about all of your interlocutors, (yes, I'm sort of speaking for other people, but I don't think I'm far off.) so I'm not sure why you think I would waste time trying to bait you into saying something dumb. You do that well enough without my help. Also, I'm well aware that such a question is unlikely to sway any of the people on your side either. So why would I ask Mark? Could it be that .. I'm trying to determine what you believe, and how your beliefs might differ from mine? Just like I said I was? Oh no, that might call for the fainting couch again!

>They aren't serious, evaluative questions

..In your opinion. Are you not able to see the value in applying hypothetical situations to your beliefs in order to "test" whether your beliefs lead you to support things that are very unlikely to be valid?

>I did. Again, not in the way you wanted me to do so. You (and some others) seem to have a real problem when the answer to a question is both yes and no.

Nonsense. Its more accurate to say that I have a real problem when the answer is neither yes or no, and consists of repeating platitudes and boilerplate. Look at the comment thread Mark. How many comments did it take before you actually said "yes, but only in these cases.." And "yes, but" is a perfectly valid answer - but you didn't say that until comment 7. You started your fainting routine in comment 5. So spare me. If you're going to bullshit in response to a straightforward question, I'm going to point out that you're bullshitting.

>Having such a stark view of the world is terribly ill-suited to accomplishing most things in this day and age.

If you say so. In your case, it allows me to detect someone who is easily confused by jargon, and is way over his head in trying to coherently process concepts and explain how they fit together.

>I find it very telling that vast majority of what you have written in this thread has been about me.

Again - you're studiously avoiding your use of the avoidance, fainting couch routine. If you stop it, you won't see all the bs about you.

Haplo9 said...

>And there it is. Usually when I see something like this, I just put it through my right wing blog translator into English and get out the truth: Mark knows what he is talking about, this sucks, now I must make fun of him as I have nothing substantive to say in response.

Heh. Isn't it odd that your "right wing blog translator aka mind reader always spits out a result that is supportive of you and your positions? Of course, I'm sure you think it's pure troof. Don't learn, do you?

You know what else is funny about this whole exchange? The question I started the thread with was roughly this: "Mark, I think you believe x. Am I right? If not, can you explain how I'm wrong?" Contrast that with how you do this sort of thing: "Haplo, your position is x, because I say so/read your mind/Rush said something." You're so busy complaining about bully weasels that you haven't even noticed that I was courteous enough to say that I might be wrong about what you think and asking you to explain - a courtesy you are rarely willing to extend to any of us troglodytes. I have to kick myself - why do I give you these things that you aren't willing to give in return?

>Tomorrow is the start of a new month. Let's see if you can go the entire month of May without the over analyzing or making personal comments about me. Stick to the evidence and refute with data and facts. Can you do it?

Assuming you don't do your fainting couch routine (also known as avoidance strategies), then of course not. There is no need when you don't resort to avoidance. I'm happy to call it out though. Can you avoid the fainting couch for a month?

Haplo9 said...

>So, there are three examples (all of which I talked about above) where increased government spending could be detrimental.

All of those examples relate to the context that the spending occurs in, not the content of the spending itelf, which is what the hypothetical was intended to illustrate. (Though not to you, I've long since learned that its best to stick with a single, simple as possible subject with you due to your penchant for handwaving and smokescreen. If you've ever wondered why I tend to do yes/no questions with you, that's why - it helps keep you on subject.) I was going to withdraw from the dicussion, because getting a single clear out of you is something of a miracle to be honest, but we are here so whatever. The point is this - a trillion dollars worth of #2 pencils is an absurd way to create economic growth under just about any conceivable circumstance. Yes, GDP will go up and unemployment will go down. Also:
1. Demand will be stimulated for a product that isn't actually demanded.
2. Some industries will expand to supply the demand and make money. Yet they will have to contract when the government no longer wants to buy pencils. (Or the government will have to buy pencils in perpetuity to avoid causing jobs and GDP to be lost.)
3. Additional workers will be hired in those industries, only to be shed when no longer needed. This pencil buying program is a raw deal for them, because they learned skills that are only needed because of government spending, so when that government spending dries up, they will have learned skills that aren't actually useful.

All those things add up to an complete and utter waste or resources. The point is this - the things that money is spent on involve tradeoffs, sometimes very negative tradeoffs. The point of the hypothetical was to determine whether you think those tradeoffs have any weight when you think of government spending and its effects on the economy. So far, you seem to be saying no - when you think its important to spend money, you don't seem to care what it is spent on. Of course, therein lies the problem - if you did care what it was spent on, then you'd have to start asking yourself how the government can tell the difference between "good" ways to spend money and "bad" ways to spend money, and why you would expect that the government is any good at telling the two apart.

Mark Ward said...

What on earth makes the government integral to the economy other than the fact that they currently leach trillions of dollars out of it?

Well, for one thing, it's a pretty big customer of the private sector. If the defense department, for example, stops spending money, we'd have some serious problems. This is why there some issues with growth right now. The government is spending less money so there is less business in some sectors.

Mark Ward said...

You are among the least aware people I've ever interacted with.

Using logic (hee hee), this makes no sense. I've had more experience with myself than you have so who is the better judge?

That perception of you not knowing what you are talking about is already well established already among just about all of your interlocutors, (yes, I'm sort of speaking for other people, but I don't think I'm far off.) so I'm not sure why you think I would waste time trying to bait you into saying something dumb.

Using numbers (as in "We all think this) is usually a sign of insecurity regarding one's argument. Why not simply stand on your own two feet without bringing others into it? And even with the numbers, that's...what?...6 people? Not anything significant and all terribly biased.

And, again, falling back on the "you don't know that you are talking about meme" is just another way of saying, "I know he's right and I don't like it." This is particularly true because I offer evidence and you...write long comments about me, not the actual subject matter.

Oh no, that might call for the fainting couch again!

This is a great example of how you guys create a fictional narrative and then argue against that. I can see that you will now be using this to avoid making an intelligent point supported by evidence. As I said before, you asked a dumb question, Hap, and I called you on it. I will most definitely continue to do so in the future, despite yet another (snore) bit of fantasy.

Are you not able to see the value in applying hypothetical situations to your beliefs in order to "test" whether your beliefs lead you to support things that are very unlikely to be valid?

There isn't any value in that because it's based on that right wing blog arrogance that you guys know better simply because you say so. Starting from that point simply betrays a severe lack of knowledge. That "test" is exactly what I'm talking about regarding weasel questions. You are simply looking for some sort of opening where you can attack. That's avoidance and that's not what I'm doing.

Mark Ward said...

I've long since learned that its best to stick with a single, simple as possible subject with you due to your penchant for handwaving and smokescreen. If you've ever wondered why I tend to do yes/no questions with you, that's why - it helps keep you on subject.)

Again, with the right wing blog arrogance and the fictional narratives. If reality doesn't fit with your instransigence, then it's "handwaving" or some other bit of shit. Seriously, look back at all that you have written thus far. It's all about me. Do you not see the obsessive quality about it?

Trust me, ask many how and why questions as you like. I'm certain I can handle them. The continual attempts to paint me as simple minded are so obvious at this point that you should honestly be embarrassed.

because getting a single clear out of you is something of a miracle to be honest,

That's because there isn't a clear answer with this stuff (see: Harry Truman's one armed economist). This is a very serious flaw in your thinking, Hap. It is shared by the others who post here and some on Kevin's site. You seemingly can only think in terms of a logical mathematical framework. In fact, you cling to it proudly. This is nothing short of disastrous in dealing with matters such as economics. (not to mention history, politics, and civics)

The point is this - a trillion dollars worth of #2 pencils is an absurd way to create economic growth under just about any conceivable circumstance.

Yes, it is absurd to consider. For one thing, it's pencils...not exactly a necessity in life. And it's only one item and I would certainly never support sinking all that money in one good in our economy. Hence, the reason why I said your question lacked depth.

Mark Ward said...

The point is this - the things that money is spent on involve tradeoffs, sometimes very negative tradeoffs.

Does that mean that you think sometimes there are positive tradeoffs? If so, what would those be and in what markets?

The point of the hypothetical was to determine whether you think those tradeoffs have any weight when you think of government spending and its effects on the economy.

Well, it was such a simple minded question that we really had no way to determine whether or not this is true. Why don't you give me a more complex example? Multiple ways the government spends money? If not, I could suggest one. Defense spending, as I mentioned above to Guard Duck. How about that one?

So far, you seem to be saying no - when you think its important to spend money, you don't seem to care what it is spent on.

Again, not true, which makes the rest of this comment woefully inaccurate, as I have explained repeatedly above. Ironic that once I started demonstrating an above average intelligence regarding economics that the personal comments started to flow rather liberally:)

At this point, why don't you simply state what your position is on government spending, how important you think it is to the economy, and the evidence that you have to support your theory. I'm looking for historical evidence here to back up claims. Let's see if you can, for a change, not turn it around on me, and simply make some points.

GuardDuck said...

Well, for one thing, it's a pretty big customer of the private sector. If the defense department, for example, stops spending money, we'd have some serious problems. This is why there some issues with growth right now. The government is spending less money so there is less business in some sectors.

The defense dept. spends money because they need to buy bullets and guns and fighter planes. Not because we need to support the military industrial complex.

You keep saying that haps example with the pencils is shallow - but yet you continue to use a similar reasoning. What's the difference between saying the reason there are issues with growth is because the gov't is spending less money on pencils or is spending less money on bullets?

Mark Ward said...

because they need to buy bullets and guns and fighter planes.

The Defense Department does a lot more than that. For example, they are one of the leading researchers in breast cancer research.

http://cdmrp.army.mil/bcrp/

This is but one example of the many programs on which the DD spends money. Think about all the companies (big, medium and small) that benefit from this spending. What happens when that spending is cut?

This also demonstrates (again) why the example of pencils is ridiculous as it is nowhere near as complex and diversified as defense department spending. So, no, I'm not using similar reasoning. I'm trying to get you guys to look at the issue of government spending in a more complex way.

juris imprudent said...

Well, it was such a simple minded question that we really had no way to determine whether or not this is true.

Are you so lacking in self awareness to miss the utter absurdity of this statement? Is this what you really meant to say - because if so, all it communicates is that not only are you an idiot but you are PROUD of it.

Mark Ward said...

If you have an evaluative analysis you'd like to offer, juris, I'm all ears. It was indeed a simple minded question for the reasons I have listed above. What's the economic state of the government in considering spending 1 trillion dollars on pencils? What are the numbers for debt and deficit? How would our spending that amount affect our trading partners around the world?

Of course, I am being kind in asking all of these questions because no one would ever spend that amount of money on pencils or any one item for that matter so it truly is a silly conversation which is why I asked for his thoughts on something more complex like defense spending (currently at 700 billion dollars for 2012).

GuardDuck said...

The Defense Department does a lot more than that. For example, they are one of the leading researchers in breast cancer research.

Which has less than nothing to do with the topic.


Think about all the companies (big, medium and small) that benefit from this spending. What happens when that spending is cut?

There you go again. Reading the question. Answering the question. And totally missing the point.


Let me rephrase that for you to see if a light bulb pops on.

Think about all the companies (big, medium and small) that benefit from this buying of pencils. What happens when that spending is cut?


So, no, I'm not using similar reasoning. I'm trying to get you guys to look at the issue of government spending in a more complex way.

But you are looking at the purpose of government spending in a very simplified way - and you are constantly doing it - while refusing to see that you are doing it.


It doesn't matter what the gov't spends money on. Pencils, bullets, cancer research. You have only justified that spending - let me repeat that - the ONLY justification YOU have presented for any gov't spending is that the lack of that spending can hurt the economy in those industries.

So let me rephrase one of your questions again and see if just maybe something might click.


1. Think about all the cancer research companies that benefit from this spending. What happens when that spending is cut?

2. Think about all the pencil making companies that benefit from this spending. What happens when that spending is cut?

3. Think about all the widget making companies that benefit from this spending. What happens when that spending is cut?

Tell me what the constant theme is here. What is your point if it isn't that the gov't has to spend money on .....something..... in order to help the economy.

Haplo9 said...

I think I'll pass on responding to every one of your whines about false narratives and
"right wing blog arrogance", whatever that is, except to point out that, yet again, you really don't like it when someone ascribes a position to you that you do not believe you hold - yet you have no problem doing that to any of us. Why is that Mark? Mind reading for me and not for thee, eh?

Regarding the complaints about overly simplistic examples, sorry bub. The simplicity of a hypothetical has no bearing whatsoever towards its usefulness in helping to evaluate a system. (In this case, your belief system.) In the world of engineering, it is perfectly natural to test a system that way. (And no, I don't use the word "test" to mean "something Mark must pass in order to show he's not an idiot" - I mean it such that "to evaluate the fitness or consistency of something.") Again, this is a natural concept in engineering fields, so maybe it wasn't fair of me to think you would understand what I meant.

>Does that mean that you think sometimes there are positive tradeoffs?

Why, yes indeedy. It's not that government spending has no benefits, its that those benefits are rarely economic benefits. They are collective action benefits - you know, spending on things that wouldn't otherwise be done by a market. National defense for example, or infrastructure. Big caveat - sometimes those things can provide economic benefits - but it is not a guarantee. Just building a road because you want to employ some people isn't of any economic value if the road has no utility. You're just buying pencils then.

>Again, not true, which makes the rest of this comment woefully inaccurate, as I have explained repeatedly above.

No, you haven't actually. You've stated that certain macroeconomic conditions should be met before you think it's a good idea for the government to spend money. You haven't stated a principle by which you would put limitations on what the money should be spent on. Are you not able to tell the difference?

>And it's only one item and I would certainly never support sinking all that money in one good in our economy.

(Er, ok, but then why did you say you would support it under certain conditions in one of your earlier comments?) Anyway, the obvious question here is why? Why wouldn't you support sinking all that money into one good? What principle tells you that that isn't a good idea? I've not seen you articulate one. Again - you've only articulated the conditions under which you would advocate spending money, not what you would be willing to spend it on.

Haplo9 said...

Finally, complexity. One valuable way to evaluate seemingly complex systems is to isolate smaller, simpler parts of those systems and try to understand how they work. If you understand how those smaller parts work, then you may find that the seemingly complex system is just a bunch of those smaller pieces operating in parallel, giving the appearance of complexity where there really isn't. In this case, the pencils hypothetical is identical to most any form of government spending - the government gets some money, and then decides what to spend it on. It may decide to spend on something that is obviously boneheaded and wasteful (like pencils) or it may spend it on something that is super valuable economically, and everything in between. But how do you, or the government, tell one type of spending from another? Identifying efficient uses for capital is hard - so hard, in fact, that the private sector is not terribly good at it, and the private sector tends to have a lot more of a vested interest in economic success than the government does. The key conceit of Keynes is that the government is somehow able to figure out what is a good allocation of resources. It isn't. You're far more likely to end up with this:

http://articles.cnn.com/2009-04-23/politics/murtha.airport_1_stimulus-funds-faa-spokeswoman-laura-brown-airport?_s=PM:POLITICS

rather than, say, the next iPhone.

Mark Ward said...

Which has less than nothing to do with the topic.

Of course it does. I would hope that you would agree that there is a big difference between pencils and breast cancer research.

see if a light bulb pops on.

Continuing with the RWBA (right wing blog arrogance), are we? Ah, well...

You can't ignore the fact that pencils have a different meaning than breast cancer research. Or bullets, for that matter.

the ONLY justification YOU have presented for any gov't spending is that the lack of that spending can hurt the economy in those industries.

No, that's simply the outcome that I have illustrated here with this post. There are plenty of others where you have to examine the nature of what money is being spent on as something like breast cancer research saves lives where pencils may not.

As to your questions, something different happens with each one. Again, you have to look at the nature of each market and industry, examine the related markets and what the fallout might be where spending to be cut, and ultimately look at how that affects our country as a whole. If the government stops spending money on pencils, it may indeed be tough on the lead and lumber industry. But if they stop spending money on bullets, the ammo industry would be affected along with our troops on the field who are defending us. Or it might impede domestic law enforcement.

Mark Ward said...

your whines about false narratives

Let's be very clear about something, Hap. You (and some of the others) do this.

The tactic being used today is familiar to those who have followed the activities of Karl Rove: Go directly after the other side’s strengths. Do not accept the truth or the obvious. Instead, make claims that cloud the issue. Some will believe you. Others will be confused. Your opponent’s strong point will be neutralized.

Our recent discussion is a prime example of this as many of your comments are quite illustrative of this tactic. I'm not sure whether you do this on purpose or not but you really need to cease and desist. If you are doing this on purpose, it's obviously pointless to continue with such a tactic now that you have been outed.

this is a natural concept in engineering fields, so maybe it wasn't fair of me to think you would understand what I meant.

Seriously, really? You don't see the arrogance here?

And, as I mentioned above to GD, you're still ignoring the discussion about the fundamental nature of of pencils which is a very simplistic example.

its that those benefits are rarely economic benefits.

Your ideological slip is showing, Hap. But this is my whole point. I don't have ideology getting in my way like you do. There are times when government spending is good for the economy and times when it is bad, to put it in a rudimentary way. And, whether you want to admit it or not, the government (at all levels) is part of our economy. This intransigence is holding you back.

Mark Ward said...

You haven't stated a principle by which you would put limitations on what the money should be spent on. Are you not able to tell the difference?

Well, that's why we have elections, Hap. Obviously, this is a huge point of contention depending upon where you are at politically so there isn't a right or wrong answer to this one. In addition, the world is in a constant state of change so limitations one day could be release the flood gates the next which is why that there should never be any ground in stone principle. This is also why I would be interested in what your views are on defense spending given the context of our discussion.

Why wouldn't you support sinking all that money into one good? What principle tells you that that isn't a good idea?

I've illustrated this above in my answer to GD. Again, it has to do with a qualitative analysis. Pencils are a lot less important than, say, small pox vaccinations after a biological attack, for example, no? Here we are talking about much more than just the economy of some industries. And, again, this changes as he world changes.

the pencils hypothetical is identical to most any form of government spending - the government gets some money, and then decides what to spend it on.

No, it's not. Here's your ideology getting in the way again. You've created a straw man argument (pencils) and made it true for all government spending. Spend some time actually researching the expenditures of government. Make an attempt to go into it with an open mind and not do the usual whining about statism and size of government. I think you'll find there's more benefit there than you think. In short, try not to be biased.

Identifying efficient uses for capital is hard - so hard, in fact, that the private sector is not terribly good at it, and the private sector tends to have a lot more of a vested interest in economic success than the government does. The key conceit of Keynes is that the government is somehow able to figure out what is a good allocation of resources. It isn't.

Again, you're biased, although at least you admit that the private sector isn't very good at it either. I would submit that the government does have an interest in success (economic or otherwise) because, unlike the private sector, WE can vote them out of office.

I'd agree that Keynes was certainly conceited. I don't think that the government is always able to figure out the best allocation of resources. But the opposite isn't true either.

GuardDuck said...

I give up.


Mark, you aren't even trying to listen to what's being said to you.

Mark Ward said...

Mark, you aren't even trying to listen to what's being said to you.

Yeah, that's a crock of shit. Here's how you wanted me to answer your questions.

Think about all the companies (big, medium and small) that benefit from this buying of pencils. What happens when that spending is cut?

There is less growth because the government is bad and distorts the market with its spending.

1. Think about all the cancer research companies that benefit from this spending. What happens when that spending is cut?

There is less growth because the government is bad and distorts the market with its spending.

2. Think about all the pencil making companies that benefit from this spending. What happens when that spending is cut?

There is less growth because the government is bad and distorts the market with its spending.

3. Think about all the widget making companies that benefit from this spending. What happens when that spending is cut?

There is less growth because the government is bad and distorts the market with its spending.

Hallelujah! I've seen the light and have now converted to the Church of Single Minded Ideology and the Willfully Ignorant.

That about what you were hoping for, GD?

GuardDuck said...

Uhhh, not even close. Try again.

Of course if you were to actually try to be reflective you could open your fucking ears and listen.



(Hmmm - when the person you are talking to says you aren't hearing the point he is making, the normal response is for clarifying - not smart assed douche baggery. I guess you do things differently around here huh?)

juris imprudent said...

Go directly after the other side’s strengths.

In your case your great strength is bullheaded belief without the slightest ability to construct a logical argument supported by evidence. However, we don't attempt to outpreach you - I wouldn't even try. I do on occasion say something as stupid as you do routinely. The difference is I recognize it when I do and try to not do it again.

juris imprudent said...

Go directly after the other side’s strengths.

In your case your great strength is bullheaded belief without the slightest ability to construct a logical argument supported by evidence. However, we don't attempt to outpreach you - I wouldn't even try. I do on occasion say something as stupid as you do routinely. The difference is I recognize it when I do and try to not do it again.

6Kings said...

This thread has made it very clear that M really likes being ignorant. His ideological edifice built upon rhetoric and complex sounding jargon can't take much more rational thought or it will crumble like a house of cards.

Eric said...

Truly, a bizarre thread indeed. Mark, I don't understand how you put up with this antagonism. It's very unfounded. It's clear that you have made every effort for "out of the box" thinking" only to be met by continued false accusations and ad hominem attacks. I sincerely hope that you don't take their drivel to heart. Accurate is the characterization of Karl Rove-like tactics. I don't see many supporters of Mark that post here. Have they been chased off in some sort of coup in comments? Another tactic for those with weak arguments.

Haplo9 said...

>Again, it has to do with a qualitative analysis. Pencils are a lot less important than, say, small pox vaccinations after a biological attack, for example, no?

And how do you tell the difference, in terms of economic value, between one and the other? What qualitative analysis besides "one sounds better than the other" are you making here?

>I would submit that the government does have an interest in success

Let me fix this for you - "I would submit that the government does have an interest in getting reelected"

You need to think about whether the desire to get reelected really translates into the desire to make something be successful, economically or otherwise. They are very much not the same thing.

>I don't have ideology getting in my way like you do.

Bahahaha. But we know better. Mark, just fyi:

Right wing blog arrogance
false narrative
the Rove
intent to weasel

I know its fun to throw these pejoratives around, and I certainly don't mind wrestling in the mud either, but you should know - much like you automatically disbelieve me when I point out that you are willing to lie in service of your ideology, or that you throw up smoke and wave your hands when you are either purposefully missing a point or simply incapable of grasping it, I too have no interest in your judgement of my intentions. I'd have to have some respect for your opinion or your ability to construct a rational argument, which, if it wasn't clear, I don't. You are useful because you represent a lot of leftist thought IMO, so arguing against you is valuable, if ultimately futile. But you are welcome to keep tilting at windmills.

Mark Ward said...

the normal response is for clarifying - not smart assed douche baggery. I guess you do things differently around here huh?

Well, I tried that the last time we had a discussion, GD, and you were an ass hat.

To Eric-Welcome! I enjoyed your posts in the climate change thread. As with your comments there, your comments here are spot on! I suspect that you are correct that their goal (and by they, I mean juris, 6Kings, Hap and Guard Duck) is to "own" the comments section of this site in order to make themselves feel better about their rapidly decomposing ideology. They routinely bully people off of here, calling them a "Yippee Dog Posse," ironically, as they are exactly the same. Likely, they don't have many people left who will listen to them so in some ways, I feel like it's my duty and honor to give them a forum and make an attempt to break through. Hope you stick around!

Mark Ward said...

What qualitative analysis besides "one sounds better than the other" are you making here?

Based on their clear benefit to the economy. As I have mentioned many times, the fact is that consumer spending is 70 percent of our economy. If there are less consumers (meaning they died from small pox), our economy would take a hit not to mention the dearth of workers who wouldn't be able to make the necessary products that we need to run our society. Really, Hap, this is simple stuff. I'm surprised you aren't following the logic in it.

(side note: I just realized I sounded very cold in that statement by not pointing out the obvious devastating emotional loss that would occur with so many deaths. But you did ask from an economic standpoint, not one of pathos)

You need to think about whether the desire to get reelected really translates into the desire to make something be successful, economically or otherwise. They are very much not the same thing.

I would agree and, ironically, you have pointed out why I vote for Democrats as opposed to Republicans. Often times, they push policies that aren't popular (Civil Rights Act, Health Care Law) but are the best thing to do. Obviously, there are plenty of Dems that do things just to get reelected but the entirety of the GOP (save for Ron Paul and maybe a few others) know their support mechanism and push policy just to stay in power.

the Rove..I know its fun to throw these pejoratives around,

Let's put them out in 6 simple steps...a handy checklist, if you will, so from now on we can see how you fall in pattern with this in our discussions.

1. Go directly after the other side’s strengths.

2. Do not accept the truth or the obvious.

3. Instead, make claims that cloud the issue.

4. Some will believe you.

5. Others will be confused.

6. Your opponent’s strong point will be neutralized.

This is exactly how you and the others operate. You've done it a million times. It's how you are trained because that's what your pundits do. Guys like Bill Whittle are absolute pros at this. Honestly, I have to give folks like him credit. It works...well, it is for now anyway. The outcome of this year's election will be a good test as to what its life expectancy will be in the coming years.

Here's how it went in this thread. You read accurately that I have strength on the subject matter of this post. You did not accept the truth or the obvious about the government's integral part of our economy. You made claims that clouded the issue...ironically, and not surprisingly, since you accused me of it-hand waving! Examples:

you have above average ability to put buzzwords and jargon together to make yourself sound intelligent to those who don't try to unpack the verbal diarrhea...

I admit - its kind of fun to watch Mr. wannabe sober objective analysis furiously wave his arms and fart out smoke.

Oh no, that might call for the fainting couch again!

The simplicity of a hypothetical has no bearing whatsoever towards its usefulness in helping to evaluate a system. (In this case, your belief system.)


Sadly, however, points 4-6 never have come to fruition because no one (save for a few of us) is reading these comments which means nothing has really been neutralized.

As I mentioned above, so far point #6 doesn't seem to be working very well in general for you guys which, I suspect, is the reason for the quick jump to personal attacks. You know, you could just admit that there are flaws in your ideology. There are certainly flaws in liberal ideology.

Haplo9 said...

>Based on their clear benefit to the economy.

Um.. Ok? In other words, because you say so? Seriously - how is that not saying "because it sounds better"? Like GD said - this whole thread seems to have gone right over your head, as you seem to be unable to grasp that a. a dollar spent on one thing is not equivilent to a dollar spent on something else in terms of economic benefit and b. there is no good way to objectively measure whether spending money on something is beneficial economically. In other words, you're saying its beneficial because you say its beneficial.

> If there are less consumers (meaning they died from small pox), our economy would take a hit not to mention the dearth of workers who wouldn't be able to make the necessary products that we need to run our society.

Again, you are avoiding tradeoffs - either you don't like to have to think about them or you wish they didn't exist. To use an extreme hypothetical to illustrate the point - if you have to take 10 trillion dollars from all taxpayers to prevent 3 people from dying of smallpox, then the tradeoff isn't worth it. A persons life isn't worth an infinite amount of resources, especially once you realize that those same resources could save/improve a lot more lives when used in other ways. Really, Mark, this is simple stuff. I'm surprised you aren't following the logic of it.

>Often times, they push policies that aren't popular (Civil Rights Act, Health Care Law) but are the best thing to do.

And, as is so often the case, you are unable to accept that other people might have different opinions about what is the best thing to do. (Er, and in the case of Civil rights, it was not the Democratic party that pushed that one, which you probably already know.) This is really just you being a blue cheerleader though, in being naive enough to believe that your team is somehow more fundamentally noble than those other guys. I'm afraid I don't share your rosy view - I've seen nothing to indicate that either R's or D's are different than the rest of humanity - they look out for themselves first.

As to your checklist, you may not be surprised that I think it applies far better to you than it does to me. (Except for the first, which I only think applies to people in certain positions, like maybe military tacticians, politicians, and CEO's.) This is why it's (both of us, really) tilting at windmills. You really think I sit around and think about what your strengths are? How about I read a post from you and think, "I disagree"? Too simplistic, no doubt.

>You read accurately that I have strength on the subject matter of this post.

And just one last attempt at you getting some perspective on yourself. I know I've mentioned this many times, but have you ever taken a step back and wondered why it is that whenever you do your "this is what you're really thinking, conservative" routine, you always claim some variant of "my positions are strong and unassailable, deep down you guys know that and are deathly afraid of that"? Doesn't that seem a little bit convenient? You sure you aren't trying to project your own insecurities onto us? After all - the only time I have ever felt like you probably know what you're talking about is when you talk about teaching, which, coincidentally, is something you have actual experience with. But hey, you seem to be sure you know whats going on in my mind better than I do, so apparently I am scared of your positions without even knowing it. It's probably due to some combination of fear, hate, anger wanting to win the argument, or racism. I'm sure you can tell me which.

Mark Ward said...

In other words, you're saying its beneficial because you say its beneficial.

No, because it is a fact that 70 percent of our economy is consumer spending. I wish it weren't, actually, but it is.

Again, you are avoiding tradeoffs - either you don't like to have to think about them or you wish they didn't exist.

Let's see, you've done numbers 1-3 again. You just can't help yourself, can you?:)

if you have to take 10 trillion dollars from all taxpayers to prevent 3 people from dying of smallpox, then the tradeoff isn't worth it. A persons life isn't worth an infinite amount of resources, especially once you realize that those same resources could save/improve a lot more lives when used in other ways.

I would agree but now you've pulled #3 again along with completely distorting what I said.

(Er, and in the case of Civil rights, it was not the Democratic party that pushed that one, which you probably already know.)

Perhaps you missed this discussion where Larry and I think it was Guard Duck made the same claim and then admitted I was correct. If you think otherwise, do some research and present your findings.

But hey, you seem to be sure you know whats going on in my mind better than I do

Not at all. I'm only judging you based on what you write here. You are judging me, however, on some sort of fictional character that you created...one that wants to take "10 trillion dollars from all taxpayers to prevent 3 people from dying of smallpox, then the tradeoff isn't worth it."

You don't accept the obvious, Hap, so you make outrageous claims to cloud the issue. Meanwhile (as if by magic), the original points have all been forgotten...points which illustrate the flaws in your ideology about government.

I'm stunned. I can't hardly believe it!

Haplo9 said...

>Let's see, you've done numbers 1-3 again.

Still certain of those strengths of yours that I'm terribly afraid of, eh?

>No, because it is a fact that 70 percent of our economy is consumer spending.

Sigh. Which has absolutely nothing to do with whether spending by the government is economically valuable or not. You really have no clue what any of us were talking about, do you.

>You are judging me, however, on some sort of fictional character that you created...

You have no idea how ironic it is for you to say that, do you? :)

>Perhaps you missed this discussion where Larry and I think it was Guard Duck made the same claim and then admitted I was correct.

Well, I've certainly heard the story of how it was the R's that pushed civil rights and then all turned Democrat, while all the opposition to Civil rights went R, but I'd think Robert Byrd would have made it clear that its not quite as simple as that - don't you think?

>so you make outrageous claims to cloud the issue.

Hardly my fault that you can't tell the difference between a claim and a hypothetical used to illustrate a point.

This thread makes me want to coin a new saying - maybe "incoherence is the main tool of incompetence.", but it could probably have a better ring.

Anyway - this is my last response since we are way past getting anything useful out of this thread. I had hoped that a simple, straightforward hypothetical could get you to focus on a single subject and the discussion could be productive, but it was not to be.

Mark Ward said...

Still certain of those strengths of yours that I'm terribly afraid of, eh?

Well, I am certain of my strengths but I'm more certain of reality...something with which you have a problem.

You really have no clue what any of us were talking about, do you.

Of course I do. We're talking about government spending (almost always bad in your eyes, right?). If there is a biological attack of some sort and we need the government needs to spend money on a vaccine, this benefits the economy simply because less consumers means less growth.

Well, I've certainly heard the story

The first volley for the Civil Rights Act was President Kennedy's speech on June 11, 1963. The president turned to his brother to draft the legislation. It was strengthened in the House Judiciary Committee by Emmanuel Celler and ultimately passed by Lyndon Johnson. There was also key support in the Senate by the Majority Leader, Mike Mansfield.

All of the names I have mentioned were Democrats.

Now, it certainly was opposed by Southern Democrats and few Southern Republicans but the bill originated and was driven by Democrats from the North. No R's pushed for civil rights. They supported it, of course, if they were from the North but they didn't push nor drive it.

Eric said...

since we are way past getting anything useful out of this thread.

That is entirely your fault, Haplo9. This discussion began as an examination of what factors influence GDP growth in our economy. Your first comment was not useful at all and, as Mark correctly noted, severely lacking in depth and critical thought. Mark tried to steer the conversation back to something intelligent and you threw a fit and proceeded to attack him personally.

It's obvious that you don't like government spending. Why do you have to allow that emotion cloud your judgement? Q1 2012 GDP was sluggish because governments at all levels (federal, state, local) have cut spending. They are like any other significant part of the economy in that their spending decisions do have an effect on growth. This is a fact of life and it's not going to go away.

juris imprudent said...

We're talking about government spending (almost always bad in your eyes, right?).

This is why you are an asshole M [btw, I know that I'm an asshole when it comes to politics at least]. You throw in the parenthetical jibe rather than leaving it at a simple, correct statement.

The discussion is about govt spending. The stupid part is someone who says it is almost always bad (which he didn't - that is your projection) and someone who says it is almost always good (which is the inference about your position).

Govt spending can be good or it can be bad - that depends on a lot of things. But you always insist on reducing to a caricature -- your caricature -- the position of people that don't agree with you. It is extremely annoying and utterly counterproductive to discussion. If it makes you feel better - then be honest about what you do and why you do it.