(02-22-2012 03:19 PM)Max Power Wrote:  

(02-22-2012 02:35 PM)BlazerFan11 Wrote:  Explain how the CBO was wrong it it said the stimulus package would end up having a negative effect on GDP.

The (very) long term negative effects of the stimulus are due to the fact it's paid for by borrowing, and so therefore we have to pay interest on it for years in perpetuity, and bondholder. Basically, the stimulus raised GDP by 3% through this year and starting in 2015 it will start lowering it by 0.2% each year. If the stimulus is paid for by currency devaluation or direct taxation though it would have very clear positive effects.

And how would more gov't spending be paid for? More debt. Surely you don't think the entire national debt can be paid off with tax hikes (?). And by openly pining for currency devaluation, you can no longer keep up the masquerade of being a crusader for the poor.

Max Power Wrote:

(02-22-2012 02:35 PM)BlazerFan11 Wrote:  Yep, it was those damn conservative economic policies that led Greece to where they are today. If only they'd had more spending and entitlements...

It's the damn conservative Euro policy which took away the tool of currency devaluation that led to the crisis. And it's the damn conservative policy of austerity that's making it worse, shrinking their GDP by 7% and causing massive unemployment. Tough to pay off that debt when tax revenues dry up.

You must be the first person in the world to call the EU policies "conservative." BTW, currency devaluation sure worked wonders for Belarus last year.

Quote:Belarus is headed for an economic “meltdown” and the ruble will need to depreciate another 51 percent, VTB Capital said, as locals lay siege to shops and protest price increases after the central bank devalued the currency.

The Belarusian central bank let the managed ruble weaken by 36 percent versus the dollar on May 24 as demand for dollars and euros from importers and households threatened to derail an economy already laboring under a current-account deficit equal to 16 percent of gross domestic product.

http://www.bloomberg.com/news/2011-05-25...-says.html