Econ: "You can always build prosperity by increasing debt"

[CrackSmokeRepublican]

"You can always build prosperity by increasing debt"  

by Econ on 18.07.2010 [14:02 ]    

Stiglitz is the typical jew-imperialist with no morals. Jews typically run for the exits when trouble brews and attempt to find scapegoats for their evil machinations. Stiglitz is no exception.
Now he is trying to redeem himself when all his dumb economic ideas failed and when enacted in the Third-World and have proven disastrous as the quantitative results now show. For all the advice that Stiglitz gave, he can't point to a single country that the IMF/World Bank helped in which the standard of living today is actually higher than in the 1970's. This is the legacy of the jews, now desperate to extract themselves from the worthless economic advice they were peddling. In the US, their economic advice is now suspect as well. Americans have now been impoverished from boom and bust asset bubbles, 'globalization', out-sourcing of jobs, foreign aid to the parasites in the zionist enitity, foreign wars and too many useless military based around the globe.
Stiglitz is left of the write about the 'malcontents' and the '3-trillion' US economically self-defeating war in Iraq after the fact. No business case is even conducted on the futility of US efforts to prop a debt-ridden empire on life support. Even Argentina went bankrupt when it could no longer afford its massive debt and forced to default. To hide the insolvency of US banks that lent money to Argentina, the US was forced to launder Argentina money just to pay the interest on this debt to avoid exposing US banks.
It was the usual jew-nonsene that you could 'build prosperity by increasing debt' with the jew-bankers creating the usury and Ponzi debt scams to enrich themselves. The dumb and gullible Americans clearly bought into this concept.
For Stiglitz worked for the World Bank/ IMF instituting the 'Washington Consensus' and US dollar hegemony in which resource-rich Third World nations were robbed of their natural resources and pensions, forced to produce cash-crops that didn't benefit their citizens, buy worthless US military equipment to subdue their impoverished citizens and import subsidized US agricultural goods that often put Third-World farmers out of business.
In the usual manner, these Third-World nations were encouraged to take on high-interest IMF loans which were never designed to be paid back with a small gang of Third-World ruling elites siphoning off the money to foreign bank accounts and speculating in the worthless US stock markets.
Stiglitz advice to the Third Word is now coming back to haunt him. The same austerity measures he proscribed to the Third-Word regimes are the same measures he must now proscribe to the US: sell off government safety-net services(eliminate unemployment insurance, Medicare, Social Security, Government pensions) to private investors (in this case the Chinese I presume), devalue the currency to boost exports(what exports: worthless dollar?; Chinese currency is pegged to the dollar and is the biggest US creditor) , increase taxes(on the impoverished citizens, can raising taxes actually cover the massive US debt burden) and protect the banking elite(massive TARP bailouts, zero percent Funds rate to buy US treasuries and inflated money supply).
WE are now await the Nobel Prize winners to see if their dumb economic theory will work in the US. Like the evil jew Allan Greenscam, the bankers seem to be pushing more debt even when the patient has overdosed and dying a slow and painful death.

Economics in Free-fall.. A MUST READ!
by Paul Craig Roberts
July 15, 2010
http://www.warpproxy.com/browse.php?u=O ... hvbWUv&b=5

I admire Joseph E. Stiglitz, because he has a social conscience and a sense of justice, the absence of which turns economists into monsters. Despite his virtues and Nobel Prize, Stiglitz sometimes falls down as an economist. Readers of my new book, How The Economy Was Lost, will be aware that I take him to task for the Solow-Stiglitz production function, which seriously misleads economics about the scarcity of nature's capital.

Another of Stiglitz's shortcomings, one that he shares with most economists, is his habit of reifying the market economy. The market is a social organization. The results of market activity reflect the behavior of the human participants in the market. When economists reify the market, they attribute the behavior, ethics, and morality–or lack thereof–of humans to the market itself. Thus, Stiglitz describes human failures as "market failures," and he asks in his new book, Freefall, "why didn't the market exercise discipline on bad corporate governance and bad incentive structures?"

Photo: AFPSocial institutions are inanimate. They do not possess life and cannot impose good outcomes on human action.

Libertarians also reify markets, but instead of blaming markets for human failures, they imbue the market with human virtues and even with the super-human virtue of producing results that human intelligence cannot improve upon. Economists' "risk models" for which Nobel Prizes have been awarded and Federal Reserve chairman Alan Greenspan attributed the social institution with economic wisdom beyond man's.

It is likely that the practice of reifying the market economy developed as a form of shorthand. It was convenient to say that the market did this and that rather than to have to describe the human interactions that produced the results. The market was transformed from an abstraction into a life form and became the actor instead of the humans operating within the institution.

If the outcomes are good, libertarians attribute the good results to the market's virtues; if bad, libertarians blame human interference–government regulation. Economists of Stiglitz's persuasion see it in the opposite way. Good results are produced by regulation; bad results are the result of allowing the market to make decisions on its own.

This way of thinking, which reifies a social institution, is ingrained in economics. It is the source of enormous confusion and has resulted in a pointless long-running ideological battle that Stiglitz calls "a battle of ideas."

It is possible to clear away the confusion. First, understand that a free market is one in which prices are free to respond to supply and demand. Economists of all persuasions understand that to fix a price below the price at which supply and demand equate results in shortages. Economists have learned this from rent control. Fixing a price above the price at which supply and demand equate results in surpluses. Economists have learned this from agricultural subsidies. A free market does not mean a market in which human behavior is not regulated. A free market is one in which supply and demand are permitted to equate.

Second, understand that regulation regulates human behavior, not the market. It is the actors in the market who are charged with regulatory infractions, not the institution itself. Regulation is necessary because of human faults, such as greed, fraud, carelessness, not because of market faults. Regulation is necessary because of human failure, not because of market failure.

Third, understand that the problem of regulation is that it is done by flawed humans. Human flaws do not disappear by moving human action from the economy to government. Most likely the flaws worsen as government decisions are often unaccountable. Many economists assume that regulators act in the public interest. However, as George Stigler, another Nobel Prizewinner, pointed out several decades ago, regulators are invariably captured by the industries that they regulate.

There are endless examples of regulators–indeed, entire governments–captured by the private interests that they are supposed to regulate. For example, in a recent subscriber's edition of CounterPunch (June 16-30), Jeffrey St. Clair describes in detail the incestuous relationship between the government's Minerals Management Service and the oil industry. An agency charged with regulating the impact of oil drilling on the environment became "a bureaucratic facilitator of big oil." Thus, the environmental catastrophe in the Gulf of Mexico and looming catastrophes along Alaska's fragile coastline.

Indeed, economists themselves and academics are often captured by private interest groups and turned into shills. In How The Economy Was Lost, I accuse economists of shilling for transnational corporations when they falsely describe jobs offshoring as the beneficial workings of free trade. Like the Israel Lobby, corporations have found that money will purchase professors, academic departments and think tanks, as well as journalists.

Offshoring transforms American workers' wages into performance bonuses for executives, capital gains for shareholders, and honoraria and research grants for economists who shill for the practice.

The problem that the US economy faces is far more serious than the financial crisis resulting from financial deregulation. The reason that traditional monetary and fiscal policies cannot produce an economic recovery is that so much of the US economy has been moved offshore. As the jobs have departed, there is no work to which low interest rates and massive government spending can recall workers. This is the real freefall.

http://www.iraq-war.ru/article/229659