Comments on: Keynes’s Ghost

By: Rick

Rick — Fri, 23 Oct 2009 18:10:05 +0000

Even if the multiplier effect were true, it ignores the greatly increased administrative and bureaucratic cost associated with having the government involved in the system, a much great greater impact than in Keynes day. A dollar seized is not a dollar spent back into the system from which it was seized. The government operating and carrying cost is already causing this system to operate at a loss. If we take as an example the 14.26 trillion dollar GDP and apply Hauser’s Rule that tax revenues run about 19.5% of GDP (consistent for the last 60 years), then net revenues would be about 2.8 trillion for the year. We are projected to run 1.5 trillion over that in operating costs this year. All we should have to do to cover that would be to spend an extra trillion dollars that we don’t have and it will magically be covered and our GDP will rise in response. Wonder why it didn’t work last year?

By: Obama Adviser Concedes “Stimulus” about Out of Gas | The Freeman | Ideas On Liberty

Fri, 23 Oct 2009 12:53:59 +0000

[...] Timely Classic “Keynes’s Ghost” by James C. W. [...]

By: MrYules

MrYules — Mon, 03 Aug 2009 21:50:52 +0000

It seems to me (untrained in economics) that the argument that $1.00 of “government” expenditure has $1.50 in impact has a fatal flaw on the face of it. If it were true even that $1.00 of “government” expenditure had $1.01 in impact that would imply an event comparable to a perpetual motion machine, in the field of money. There would be more monetary “energy” produced by such a magical process than was injected into it. Such a process fails in physics and chemistry, and I suspect, in economics as well.