The Data and Analysis


Spending and more spending, all part of a master plan, but what does this mean?


The video at right speaks to this, but can we not see the cliff up ahead?   Is our generation the blind, pass the debt forward to our kids?



Laffer:  Link


Today, even stimulus spending advocates have their Ph.D. defenders. But there's no arguing with the data in the nearby table, and the fact that greater stimulus spending was followed by lower growth rates. Stimulus advocates have a lot of explaining to do. Their massive spending programs have hurt the economy and left us with huge bills to pay. Not a very nice combination.


Sorry, Keynesians. There was no discernible two or three dollar multiplier effect from every dollar the government spent and borrowed. In reality, every dollar of public-sector spending on stimulus simply wiped out a dollar of private investment and output, resulting in an overall decline in GDP. This is an even more astonishing result because government spending is counted in official GDP numbers. In other words, the spending was more like a valium for lethargic economies than a stimulant.


The Keynesians love it, NYT’s love it - more stimulus- QE3.  


The Austrians are predicting a serious negative impact down the road.  Krugman and his man are however smiling.  More of the same is the doctors’ orders apparently.   For the rest of us we might just well face a period of stagflation, just when you thought that lesson was learned back then.   Jimmy Carter meet your clone:  Obama and his crew. 


So if these stimulating folks are wrong, then a deeper hole to climb out of, will be the outcome.   And they will then ask for another stimulus, for this shows they will never learn. 


Brace yourselves folks, we are in for a long correction here, especially without a new President any time soon.   I know that the doomsayers are often too dramatic and sometimes wrong, but it would appear this time we are seeking wrong ideas to fix a problem that is all about too much government intervention with the proposed fix of even more government.


Paradoxes continue.   What will historians write about the intelligence of our era?



How much is too much?