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Right Wing Ideology Fails in Economics As Well

obvious Child said:
Comptroller Dugan Says CRA not Responsible For Subprime Lending Abuses

FDIC: Speeches & Testimony - 12/17/2008

As I understand it, CRA loans in aggregate outstanding never came close to anywhere near 10% of the total housing market loans outstanding. Blaming the CRA is like blaming a $5k over budget expense account for why Enron went bust.
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But do any of our right wing whiz kids have the character to admit it?...I doubt it.

Talk smack, never admit defeat, move on.....rinse, lather, repeat
 
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Ahlevah said:
This is the same Keynesian gobbledigook
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Krugman's neo-Keynesianism marks a significant divergence from the pure Keynesian thesis. The incorporation of the IS/LM model (originally introduced by Hicks and developed further by Modigliani, though Hicks was opposed to the nature of its utilization by the neo-Keynesians), and the later incorporations of the Phillips curve and the Mundell-Fleming model created a reliance on neoclassical economics that rendered neo-Keynesianism far more orthodox than anything else. Even Krugman's own "new trade theory" is fundamentally based on upholding trade liberalization, just as Keynesianism in general is fundamentally based on upholding capitalism, contrary to the misinformeds belief of ignorant anti-socialists.

I've found that Internet rightists typically know very little of Keynesianism, as is the case of their knowledge of political economy in general. They simply have some vague notion that it involves state intervention and apply the label "Keynesianism" to any and all forms of such intervention they can identify because they regard the terms as synonymous. Their additional inaccurate use of the term "socialism" really inclines one to facepalm pretty ****ing hard. :)
 
No matter what you mix it with, poison is still poison.
 
obvious Child said:
Comptroller Dugan Says CRA not Responsible For Subprime Lending Abuses
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"Govmint wuvs me, dis I know, cause the govmint tells me so."

Different dogma, same blind obedience.


Agnapostate said:
Indeed. That's the basis behind the sheer absurdity of the term "anarcho"-capitalism.
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No, the basis for free market capitalism (whether pure or with minimal government) are stone-cold economic facts. You might not like them, but they still remain so.
 
Alex Libman said:
No, the basis for free market capitalism (whether pure or with minimal government) are stone-cold economic facts. You might not like them, but they still remain so.
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That would presume some manifestation of existence on the part of free markets, which we're still waiting for. Your reference to "purity" reveals your utopian reliance on the textbook economic spectrum, which is useful for modeling theoretical abstractions but has little practical application...as is the case with free markets.
 
Agnapostate said:
I've found that Internet rightists typically know very little of Keynesianism, as is the case of their knowledge of political economy in general. They simply have some vague notion that it involves state intervention and apply the label "Keynesianism" to any and all forms of such intervention they can identify because they regard the terms as synonymous.
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What I'm referring to is the idea that, in order to maintain full employment, government should maintain high levels of aggregate demand by making up for shortfalls in private-sector spending. It's the old supply-side, demand-side debate in which some people (like me) believe that demand should come from savings, not borrowing. Borrowing is fine if it's used for a productive purpose that provides a return greater than the cost--and if you can afford it. I just don't happen to think that Cash for Clunkers and programs designed to keep buyers in their homes at bubble prices qualify as productive uses of taxpayer funds.
 
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Agnapostate said:
That would presume some manifestation of existence on the part of free markets, which we're still waiting for.
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Violent people like you keep getting in the way. :(

In the meantime, all societies that exhibit the greatest economic freedom also gain the greatest economic benefits.


Agnapostate said:
Your reference to "purity" reveals your utopian reliance on the textbook economic spectrum, which is useful for modeling theoretical abstractions but has little practical application...as is the case with free markets.
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When you go into surgery, do you expect your surgeons to base their actions "purely" on empirical knowledge of medicine, or do you like some ritual animal sacrifices and voodoo added instead?
 
Ahlevah said:
What I'm referring to is the idea that, in order to maintain full employment, government should maintain high levels of aggregate demand by making up for shortfalls in private-sector spending. It's the old supply-side, demand-side debate in which some people (like me) believe that demand should come from savings, not borrowing. Borrowing is fine if it's used for a productive purpose that provides a return greater than the cost. I just don't happen to think that Cash for Clunkers and programs designed to keep buyers in their homes at bubble prices qualify as productive uses of taxpayer funds.
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I understood what you were referring to. I was simply distinguishing between Keynesianism and neo-Keynesianism and the standard rightist conflation of the two. Apart from the fact that we've already discussed the reasons why full employment cannot exist in our present labor market, is your objection based on the standard irrational and empty opposition to the role of the state as an integral stabilization agent or can you identify specific deficiencies in the programs that you've identified that render them unproductive?

Alex Libman said:
In the meantime, all societies that exhibit the greatest economic freedom also gain the greatest economic benefits.
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This was the only accurate portion of your post. It's a telling insight into the irrationality of capitalism's continued existence, considering anarchism's combination of greater economic freedom and benefits when implemented.
 
Alex Libman said:
Debunked by me elsewhere.
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Your "analysis" seems a bit...bare. I'd recommend consulting a legitimate and sound empirical source such as Headey et al.'s Is There a Trade-Off Between Economic Efficiency and a Generous Welfare State? A Comparison of Best Cases of `The Three Worlds of Welfare Capitalism’:

A crucial debate in policy-making as well as academic circles is whether there is a trade-off between economic efficiency and the size/generosity of the welfare state. One way to contribute to this debate is to compare the performance of best cases of different types of state. Arguably, in the decade 1985-94, the US, West Germany and the Netherlands were best cases - best economic performers - in what G. Esping-Andersen calls the three worlds of welfare capitalism. The US is a liberal welfare-capitalist state, West Germany a corporatist state, and the Netherlands is social democratic in its tax-transfer system, although not its labor market policies. These three countries had rates of economic growth per capita as high or higher than other rich countries of their type, and the lowest rates of unemployment. At a normative or ideological level the three types of state have the same goals but prioritise them differently. The liberal state prioritises economic growth and efficiency, avoids work disincentives, and targets welfare benefits only to those in greatest need. The corporatist state aims to give priority to social stability, especially household income stability, and social integration. The social democratic welfare state claims high priority for minimising poverty, inequality and unemployment. Using ten years of panel data for each country, we assess indicators of their short (one year), medium (five year) and longer term (ten year) performance in achieving economic and welfare goals. Overall, in this time period, the Netherlands achieved the best performance on the welfare goals to which it gave priority, and equalled the other two states on most of the goals to which they gave priority. This result supports the view that there is no necessary trade-off between economic efficiency and a generous welfare state.
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Keep in mind that as unemployment constitutes a form of static inefficiency, so does the reduction of it constitute another reduction of inefficiency on the part of the social democratic capitalist state. On another note, I lol'd at the OP's username, given Spooner's anti-capitalism.
 
dragondad said:
My job is not to educate you.
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So you want to debate in a manner where people don't have to back up their claims? I see.
The real reason for the economic woes of the present is because of the Venusians.
Educate yourself about that.
 
Heterodox economics is based on predictions of the failure of actually existing capitalism, so it's hardly a miraculous sign that Schiff was able to make accurate predictions...alongside his inaccurate ones. That said, the recession is of course also compatible with Marxist crisis theory, which accounts for the recent renewed popularity of Marx's Capital.
 
Agnapostate said:
Heterodox economics is based on predictions of the failure of actually existing capitalism, so it's hardly a miraculous sign that Schiff was able to make accurate predictions...alongside his inaccurate ones. That said, the recession is of course also compatible with Marxist crisis theory, which accounts for the recent renewed popularity of Marx's Capital.
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Dragondad merely asked for a rightist economist that saw the crash coming, and I showed him one
 
Agnapostate said:
Heterodox economics is based on predictions of the failure of actually existing capitalism, so it's hardly a miraculous sign that Schiff was able to make accurate predictions...alongside his inaccurate ones. That said, the recession is of course also compatible with Marxist crisis theory, which accounts for the recent renewed popularity of Marx's Capital.
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The present recession is a failure of government, willful or otherwise.

About 95% of wealth that is created by the human economy, year after year, including the eventual economic recovery from this recession, in spite of all harm that is caused by government intervention - that is a triumph of capitalism!
 
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Alex Libman said:
"Govmint wuvs me, dis I know, cause the govmint tells me so."

Different dogma, same blind obedience.
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Care to discuss the materiality levels?

I'd love to see an argument how a literal drop in the bucket caused this mess. If ever CRA loan went bad at the same time, there's no way it could cause this.

$5k Enron Expense account anyone?
 
I didn't say it caused it, I said it and similar laws contributed to it. The greatest cause was the artificial economic signals sent by the expansionary monetary policy and other Keynesian bull.

Enron's corruption is rooted in its entanglement with government.
 
Alex Libman said:
I didn't say it caused it, I said it and similar laws contributed to it. The greatest cause was the artificial economic signals sent by the expansionary monetary policy and other Keynesian bull.
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That doesn't make much sense. If that was the cause, we would have seen this during prior expansionary policies.

It's more of complete and utter abandonment of conservative best banking practices more than anything else and Fanny/Freddie buying any mortgage coupled with bad incentive programs at AIG's London FSP division as well as the repeal of the GSA.

Enron's corruption is rooted in its entanglement with government.
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How you figure that?
 
Alex Libman said:
I didn't say it caused it, I said it and similar laws contributed to it. The greatest cause was the artificial economic signals sent by the expansionary monetary policy and other Keynesian bull.
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Lower than usual interest rates do not provide loans to people without a legitimate credit history or the ability to obtain vast quantities of it without a sound income source. Do you honestly believe the people who took these loans "indifference curve" equaled their budgetary constraint as rates lowered? Accordingly, do you honestly believe banks were suddenly more inclined to loan to less than credit worthy applicants because of lower short term rates?

Come on.... There is much more to it than a dry "expansionary monetary policy".

It is commonly referred to as fraud.
 
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Several things contributed. Expansionary Monetary policy, especially low interest rates drove up borrowing. Fannie Mae, Freddie Mac, and the CRA all contributed to the subprime mortgages. Government trying to put more regulation on the lenders is like the government breaking your leg, giving you a crutch, and telling you that without them, you wouldn't be able to walk.
 
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Goldenboy219 said:
Lower than usual interest rates do not provide loans to people without a legitimate credit history or the ability to obtain vast quantities of it without a sound income source. Do you honestly believe the people who took these loans "indifference curve" equaled their budgetary constraint as rates lowered? Accordingly, do you honestly believe banks were suddenly more inclined to loan to less than credit worthy applicants because of lower short term rates?

Come on.... There is much more to it than a dry "expansionary monetary policy".

It is commonly referred to as fraud.
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I don't know man, if you ever listen to Clark Howard he has been talking about the liars loans that mortgage companies and banks were offering where you could really state whatever income you wanted to and could get a loan.

"These loan programs are designed for borrowers who have a hard time producing income and asset verifying documents, such as prior tax returns, or who have untraditional sources of income, such as tips, or a personal business. These loans are called liar loans because the SISA or NINA features open the door for abuse when borrowers or their mortgage brokers or loan officers overstate income and/or assets in order to qualify the borrower for a larger mortgage.

Low-documentation mortgages usually fall into the Alt-A category of mortgage lending. Alt-A lending depends heavily on a borrower's credit score (FICO score) and the mortgage's loan-to-value ratio (LTV) as tools to determine the borrower's ability to repay the mortgage."

Liar Loan
 
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