Post: #101

This is from Mankiw:

Quote:The Friedmans' political involvement came with its share of controversy. Most notably, in 1975 Milton spent six days giving lectures on public policy in Chile and had one brief meeting with right-wing dictator Augusto Pinochet. The result was a firestorm of protest. When Friedman won a Nobel Prize the next year, public objections came from all directions, including previous prize-winners David Baltimore and Linus Pauling.

Friedman was--and is--unrepentant. Of course, he did not endorse the dictatorship. But, he wrote, "I do not regard it evil for an economist to render technical economic advice to the Chilean government to help end the plague of inflation, any more than I would regard it as evil for a physician to give technical medical advice to the Chilean government to end a medical plague." He also notes that years later, when he offered similar economic advice to China, there were no similar protests, even though the left-wing Chinese dictators were no less oppressive than Pinochet.

The whole thing (http://gregmankiw.blogspot.com/2006/11/m...edman.html) is worth reading.

Post: #102

(02-03-2015 04:27 PM)Grange Wrote:  This is from Mankiw:

Quote:The Friedmans' political involvement came with its share of controversy. Most notably, in 1975 Milton spent six days giving lectures on public policy in Chile and had one brief meeting with right-wing dictator Augusto Pinochet. The result was a firestorm of protest. When Friedman won a Nobel Prize the next year, public objections came from all directions, including previous prize-winners David Baltimore and Linus Pauling.

Friedman was--and is--unrepentant. Of course, he did not endorse the dictatorship. But, he wrote, "I do not regard it evil for an economist to render technical economic advice to the Chilean government to help end the plague of inflation, any more than I would regard it as evil for a physician to give technical medical advice to the Chilean government to end a medical plague." He also notes that years later, when he offered similar economic advice to China, there were no similar protests, even though the left-wing Chinese dictators were no less oppressive than Pinochet.

The whole thing (http://gregmankiw.blogspot.com/2006/11/m...edman.html) is worth reading.

All the "FRIEDMAN HELPED OUT PINOCHET!" stuff strikes me as Soviet propaganda. Way overblown.

Post: #103

(02-03-2015 04:40 PM)TheWastelander Wrote:  

(02-03-2015 04:27 PM)Grange Wrote:  This is from Mankiw:

Quote:The Friedmans' political involvement came with its share of controversy. Most notably, in 1975 Milton spent six days giving lectures on public policy in Chile and had one brief meeting with right-wing dictator Augusto Pinochet. The result was a firestorm of protest. When Friedman won a Nobel Prize the next year, public objections came from all directions, including previous prize-winners David Baltimore and Linus Pauling.

Friedman was--and is--unrepentant. Of course, he did not endorse the dictatorship. But, he wrote, "I do not regard it evil for an economist to render technical economic advice to the Chilean government to help end the plague of inflation, any more than I would regard it as evil for a physician to give technical medical advice to the Chilean government to end a medical plague." He also notes that years later, when he offered similar economic advice to China, there were no similar protests, even though the left-wing Chinese dictators were no less oppressive than Pinochet.

The whole thing (http://gregmankiw.blogspot.com/2006/11/m...edman.html) is worth reading.

All the "FRIEDMAN HELPED OUT PINOCHET!" stuff strikes me as Soviet propaganda. Way overblown.

It's an old tactic. When you have no counterargument, attack the man instead of the argument. In the past it might have mattered if your attack on the man is baseless, but there's no truth, only feelings in postmodern argument.

Post: #104

As a radical-centrist and a New Keynesian economist I can't say I agree with everything Milton Friedman had to say but he's certainly a figure I respect; his opinions were different to those I hold but nevertheless he was an intellectual worthy of admiration.

Post: #105

(02-03-2015 06:48 PM)Porfirio Rubirosa Wrote:  As a radical-centrist and a New Keynesian economist I can't say I agree with everything Milton Friedman had to say but he's certainly a figure I respect; his opinions were different to those I hold but nevertheless he was an intellectual worthy of admiration.

Not sure if serious.

Post: #106

(02-03-2015 07:02 PM)vinman Wrote:  

(02-03-2015 06:48 PM)Porfirio Rubirosa Wrote:  As a radical-centrist and a New Keynesian economist I can't say I agree with everything Milton Friedman had to say but he's certainly a figure I respect; his opinions were different to those I hold but nevertheless he was an intellectual worthy of admiration.

Not sure if serious.

I am most-certainly serious. I am also a follower (to a certain extent) of neo-liberalism and supply-side economics. I'm sorry but I do not understand why you aren't sure if I'm serious.

Post: #107

(02-03-2015 07:02 PM)vinman Wrote:  

(02-03-2015 06:48 PM)Porfirio Rubirosa Wrote:  As a radical-centrist and a New Keynesian economist I can't say I agree with everything Milton Friedman had to say but he's certainly a figure I respect; his opinions were different to those I hold but nevertheless he was an intellectual worthy of admiration.

Not sure if serious.

In his defense, New Keynesianism is pretty centrist. Probably the most well known New Keynesian-not the best, just the most famous with the general public (low bar I know)-is Greg Mankiw, who was a CEA Chairman under Bush and advised Romney.

Post: #108

(02-03-2015 07:09 PM)Grange Wrote:  

(02-03-2015 07:02 PM)vinman Wrote:  

(02-03-2015 06:48 PM)Porfirio Rubirosa Wrote:  As a radical-centrist and a New Keynesian economist I can't say I agree with everything Milton Friedman had to say but he's certainly a figure I respect; his opinions were different to those I hold but nevertheless he was an intellectual worthy of admiration.

Not sure if serious.

In his defense, New Keynesianism is pretty centrist. Probably the most well known New Keynesian-not the best, just the most famous with the general public (low bar I know)-is Greg Mankiw, who was a CEA Chairman under Bush and advised Romney.

Generally, New Keynesians are thought of as more right-wing (on average) than the old Keynesians but you must remember even Lord Keynes was not a leftist and certainly did not think highly of Marxism.

Post: #109

(02-03-2015 07:30 PM)Porfirio Rubirosa Wrote:  

(02-03-2015 07:09 PM)Grange Wrote:  

(02-03-2015 07:02 PM)vinman Wrote:  

(02-03-2015 06:48 PM)Porfirio Rubirosa Wrote:  As a radical-centrist and a New Keynesian economist I can't say I agree with everything Milton Friedman had to say but he's certainly a figure I respect; his opinions were different to those I hold but nevertheless he was an intellectual worthy of admiration.

Not sure if serious.

In his defense, New Keynesianism is pretty centrist. Probably the most well known New Keynesian-not the best, just the most famous with the general public (low bar I know)-is Greg Mankiw, who was a CEA Chairman under Bush and advised Romney.

Generally, New Keynesians are thought of as more right-wing (on average) than the old Keynesians but you must remember even Lord Keynes was not a leftist and certainly did not think highly of Marxism.

I think we might be having a UK-US cultural gap type of thing here. The meme here is Keynesian -> left. Hell, Paul Krugman has morphed into the purest old school Keynesian around and he is practically on the payroll of the Democratic Party when he's not writing technical economics. There are exceptions of course. (The Republicans here mostly pay lip service to neoclassical economics.)

tl;dr: Your center is more left than ours.

Post: #110

(02-03-2015 07:09 PM)Grange Wrote:  

(02-03-2015 07:02 PM)vinman Wrote:  

(02-03-2015 06:48 PM)Porfirio Rubirosa Wrote:  As a radical-centrist and a New Keynesian economist I can't say I agree with everything Milton Friedman had to say but he's certainly a figure I respect; his opinions were different to those I hold but nevertheless he was an intellectual worthy of admiration.

Not sure if serious.

In his defense, New Keynesianism is pretty centrist. Probably the most well known New Keynesian-not the best, just the most famous with the general public (low bar I know)-is Greg Mankiw, who was a CEA Chairman under Bush and advised Romney.

Because I don't understand what's radical about being centrist. Unless there's something that I'm not getting?

Edit--

I thought you were kidding so I looked it up. And this is an actual thing.....
http://en.wikipedia.org/wiki/Radical_cen...olitics%29

Post: #111

It's hardly a meme. Keynesian theory (key word, "theory) has that reputation for a reason. It's been used numerous times to justify leftist government overreach in the name of "stimulus".

Post: #112

(02-03-2015 08:11 PM)Easy_C Wrote:  It's hardly a meme. Keynesian theory (key word, "theory) has that reputation for a reason. It's been used numerous times to justify leftist government overreach in the name of "stimulus".

Spot on. New, Old, Bi, Trans-Keynesian, whatever the fuck some of them call themselves now it doesn't matter. The fundamentals are the same, high levels of public expenditure and an intact welfare state.

Post: #113

(02-03-2015 08:11 PM)Easy_C Wrote:  It's hardly a meme. Keynesian theory (key word, "theory) has that reputation for a reason. It's been used numerous times to justify leftist government overreach in the name of "stimulus".

The use of stimulus packages is not exclusive to the left-wing. Only Austrian School economists reject the use of economics stimulus in its totality.

How exactly does the use of stimulatory policies (both fiscal and monetary) form part of government overreach?

Post: #114

(02-03-2015 09:04 PM)Porfirio Rubirosa Wrote:  

(02-03-2015 08:11 PM)Easy_C Wrote:  It's hardly a meme. Keynesian theory (key word, "theory) has that reputation for a reason. It's been used numerous times to justify leftist government overreach in the name of "stimulus".

How exactly does the use of stimulatory policies (both fiscal and monetary) form part of government overreach?

I happen to agree with some of the monetary stimulus policies so I will not comment on that.

In general, a stimulatory fiscal policy, regardless of what the consensus says, is a politically subjective term, in both the context of their intended use and their measured effect on the economy. The situations by which governments utilize stimulatory policies are clearly never the same across time and space, which only leaves them open to further subjective interpretation.

While I'm not in a position to speak on the economic or political matters that took place outside of the U.S-post Global Financial Crisis, I do know for a fact that many leftist economists and political operatives lobbied and vouched for massive fiscal stimulus policies as a umbrella policy to support their wide range of leftist policies, most of which could be considered government overreach. Neo-Keynesian economists Paul Krugman and Joe Stiglitz are the biggest offenders of this.

Aside from economist he said, she said, it doesn't take a rocket scientist to understand that massive amounts of the public expenditure could be considered government overreach in some way or another. We could argue all night long the nature of booms and busts and whether or not fiscal stimulus is necessary to keep the economy from bottoming out, but the simple fact remains that even in a perfect situation governments are going to waste millions or even billions of public dollars on projects or programs that will have little to do with curing the pains of economic downturns. These are millions of dollars TAKEN from mostly hard working individuals WORKING to EARN that money in the first place. How is that not overreach?

Post: #115

In order to believe government can be an effective agent from creating prosperity beyond the bare minimum of guaranteeing minimum negative rights (like freedom of speech, freedom of association, property, etc.), you have to have a view of human nature and society that is incompatible with the historical record and science. In my view.

That is why I could never be a Keynesian of any stripe. Only Austrian School for me, thank you.

Post: #116

Bump. Just started watching Friedman videos. Great speaker and smart guy.

What was his view on welfare for disabled people? Who is responsible for public works like roads and bridges? Does the private sector take care of everything or is there a middle way?

Post: #117

He was a nice guy. When I worked at a magazine, I wrote him a letter about what I should do after my internship. He actually wrote back.

I had lifted his address from our database. I later got in trouble for doing that. It was still nice because I was a nobody at the time.

Post: #118

(02-03-2015 09:04 PM)Porfirio Rubirosa Wrote:  

(02-03-2015 08:11 PM)Easy_C Wrote:  It's hardly a meme. Keynesian theory (key word, "theory) has that reputation for a reason. It's been used numerous times to justify leftist government overreach in the name of "stimulus".

The use of stimulus packages is not exclusive to the left-wing. Only Austrian School economists reject the use of economics stimulus in its totality.

How exactly does the use of stimulatory policies (both fiscal and monetary) form part of government overreach?

If you asked Nassim Taleb this question, his answer would be: because it's naive interventionism, in a corresponding domain as the idea of invading Iraq in order to topple an Evil Dictator™. It is to intervene and distort the normal operation of commerce without a real appreciation for what the unintended consequences will be.

We have a tendency, because of a good 2.5 thousand years or so of worshipping Aristotle's epiphenomenonology and ignoring the heuristic-based philosophies of people like Seneca or Thales of Miletus, to believe that we have greater control over complex systems than we actually do. Coupled with that is that we believe our effect on a complex system is vastly more predictable than it actually is.

In particular epiphenomenology -- the focus on past events, past phenomenon, to explain and predict the future -- has had an inherent blind spot in it, namely that by looking only to past events as a predictor of what calamities may occur in future, we tend to not contemplate even worse scenarios than have occurred in history. And thus are unprepared when those scenarios and unexpected consequences come to pass.

In military circles epiphenomenology's blind spot has a name, a phenomenon of its own: when a nation is preparing to fight the last war. I suspect it is the real reason the French were more or less overrun by Germany in World War II, because they were predicting that if it came to hostilities again with Germany, that it would be a re-run of World War One and trench warfare would dominate, thus they built the Maginot Line and made it the centre of their defence strategy. It is also the reason thinkers like William Lind keep saying the US Navy is outdated at best and irrelevant at worst, because it is essentially structured to face another Japanese fleet sailing on Pearl Harbour, and hasn't quite learned the lesson from the Falklands crisis where a about nine British ships were sent to the bottom of the South Atlantic by a bunch of Exocet missiles in quite an attractive cost/benefit analysis for Argentina.

When the government intervenes to stimulate an economy, it's basically doing the equivalent of pumping painkillers into an injured body. The error is that the government thinks the painkillers reducing the person's pain means the underlying injury has been cured. This is not the case, and indeed the underlying painkillers themselves go on (via inflation, eventually) to further injure the body -- what in medicine is called iatrogenics, harm caused by a medical intervention, and something the fools in medical academies have only recently started to understand and acknowledge despite being in business for a good two thousand years or more.

What makes this metaphor worse is that introducing the painkillers doesn't even assist the injury to heal, it just makes the injury last longer and keeps the body from healing. You will see this with treating children's fevers: while letting a kid's fever rise to above 40 degrees is bad news and needs intervention, throwing anti-fever medications like Paracetamol at a mild fever often doesn't help, because it brings the body temperature down ... ignoring that the reason the body's temperature rises is because that's the way the body works to kill off the organisms attacking it, in many cases the organisms can't survive that temperature. So bringing the temperature down via painkillers actually keeps the body from doing its own healing work. As with all antifragile systems, this has limits -- as said, if your kid's temperature starts soaring past 40 degrees, get to a doctor ASAP -- but the phenomenon is actually much the same in economic terms. When you pump money into the system, you are not allowing the system to break down and repair itself as it can and as it eventually must.

Taleb targets Krugman and Stiglitz in particular as offenders of the worst kind in this area. Krugman doesn't understand risk management, and Stiglitz has the worst form of 20/20 hindsight imaginable: he believes he predicted the 2008 credit crisis, but he identified one area of risk, not the crisis itself, when you look at his prognostications from before the subprime crisis hit.

God save us from people who mean well. -storm