Anticipating the excuse

Paul Krugman finally produces what was always a totally predictable excuse for the failure of the Obama stimulus package:

It’s crucial to keep state and local government in mind when you hear people ranting about runaway government spending under President Obama. Yes, the federal government is spending more, although not as much as you might think. But state and local governments are cutting back. And if you add them together, it turns out that the only big spending increases have been in safety-net programs like unemployment insurance, which have soared in cost thanks to the severity of the slump. That is, for all the talk of a failed stimulus, if you look at government spending as a whole you see hardly any stimulus at all. And with federal spending now trailing off, while big state and local cutbacks continue, we’re going into reverse.

Krugman’s excuse for the failure of the Bush (2008) and Obama (2009) stimuli isn’t even new. Consider the following passage from a brilliant book written by an astonishingly handsome author more than one year ago:

Ironically, there is no shortage of historical examples to support the idea that even those who nominally subscribe to an empirical approach don’t hesitate to abandon their empiricism when the data doesn’t support their theories. Consider, for example, how two decades of failing mainstream economic policies in Japan have no more caused mainstream economists to conclude that their theories are incorrect than 70 years of economic failure in the Soviet Union caused socialist economists to abandon Marxism. Some excuse is always found to explain away the theory’s failure and rationalize its continued application; if the fiscal stimulus was not too small or too late, then the interest rate hikes were too large or too early. If the federal government’s expansionary efforts were unsuccessful during the New Deal, then it must have been due to their being overwhelmed by the contractionary policies of the state and local governments.
– The Return of the Great Depression, 134

There’s really no reason to read Paul Krugman’s columns when you can read this blog and anticipate what he’s going to be writing one year later. Because Neo-Keynesians never learn from the inevitable failures of their economic models. In the Telegraph today, Ambrose Evans-Pritchard writes: “In Japan itself core CPI deflation has reached -1.5pc, the lowest since the great fiasco began 20 years ago. 10-year yields fell briefly below 1pc last week. Premier Naoto Kan has begun to talk of yet another stimulus package. “The time has come to examine whether it is necessary for us take some kind of action,” he said.”

WND column

Social Conservatives on Steroids

It is a basic principle of socionomics that economic boom times are strongly correlated with social liberalism, while economic contractions tend to be accompanied by social conservatism. This has been observed over thousands of years; the Lex Oppia of 215 B.C. was the most famous of the sumptuary laws that were passed by the Roman republic in response to the recession that took place during the second Punic war. Twenty years later, with Carthage defeated and the launch of a huge investment boom based on conquest and colonization, the Lex Oppia was repealed after the women of Rome rioted for days over the right to display their wealth in the same manner as non-Roman women.

Past as prologue

The New York Times embraces the myth of “the new normal” in an attempt to evade the obvious:

The new normal challenges the optimism that’s been at the root of American success for decades, if not centuries. And if it is here, the new normal could force Democrats and Republicans to rethink their traditional approach to unemployment and other social problems.

Some unusual suspects, like Glenn Hubbard, dean of the Columbia Graduate School of Business and an economic adviser to George W. Bush, are talking about a new, expanded role for the government in addressing the problem. In particular, Mr. Hubbard favors investing more in education to retrain workers whose jobs are never coming back. “If there is a new normal, it’s more about the labor market than G.D.P.,” he said. “We have to help people face a new world.”

For his part, Mr. Gross, also a free-market advocate, believes that it’s time for the government to spend tens of billions on new infrastructure projects to put people to work and stimulate demand.

First, if you believe it is time for the government to spend billions of dollars to put people to work and stimulate demand, you are not a free market advocate. Second, how is spending government money to “stimulate” the economy anything but a traditional approach to unemployment? The problem is debt and adding more public debt to the equation is only going to make matters worse. You would think this would be obvious, given that both Hoover and FDR tried spending billions of dollars to put people to work and what they got was the Great Depression. It is intriguing, but not surprising, to see all of the politicians and media figures so intent on taking the very actions that will cause the outcome they hope to avoid. What is remarkable is that they are doing this with the benefit of hindsight.

Get over yourself already

First, “psychiatric therapy” is complete, utter, and total BS. It’s not therapy of any kind, it’s nothing more than paying someone to listen to you talk about your favorite subject under the guise of a pseudo-scientific veneer. A pastor (religion) or a pill (science) would do anyone more good. Some of us see this right away, it takes others 40 years of incessant “therapy” from a multitude of “therapists” to realize it. Second, it’s obvious that what is wrong with the author is nothing more than an extreme case of conventional female narcissism. That being said, reading this endless solipsism of the self-centered mind does nicely illustrate how a focus on yourself is ultimately crippling and provides women with a warning of the peril presented by constant snowflaking.

The truth of the matter was that in more than 40 years of therapy (the only person I knew who may have been at it longer than me was Woody Allen, who once offered me his own analyst), I never developed a set of criteria by which to assess the skill of a given therapist, the way you would assess a dentist or a plumber. Other than a presentable degree of intelligence and an office that didn’t set off aesthetic alarms — I tended to prefer genteelly shabby interiors to overly well-appointed ones, although I was wary of therapists who exhibited a Collyer Brothers-like inability to throw anything away — I wasn’t sure what made for a good one. I never felt entitled to look at them as members of a service profession, which is what, underneath all the crisscrossing of need and wishfulness, they essentially were…. Just as some people believe in the idea of soul mates, I held fast to the conviction that my perfect therapeutic match was out there. If only I looked hard enough I would find this person, and then the demons that haunted me — my love/hate relationship with my difficult mother (who has been dead now for four years), my self-torturing and intransigently avoidant attitude toward my work, my abiding sense of aloneness and seeming inability to sustain a romantic relationship and, above all, my lapses into severe depression — would become, with my therapist’s help, easier to manage.

The byline says: “Daphne Merkin is a contributing writer. She is working on a book based on an article she wrote for the magazine about her struggle with chronic depression.” Of course she is. It’s eminently clear that she couldn’t possibly write about anything other than her own precious little snowflake self.

Quote of the Day: “Neurotics are a rabble, good only to support us financially and to allow us to learn from their cases: psychoanalysis as a therapy may be worthless.”
– Sandor Ferenczi, President of the International Psychoanalytical AssociationSigmund Freud

However, I’m not saying that all therapists are con artists. The ones who actually help people are those who provide a service politely telling people to stop acting like self-destructive morons. But that’s not “therapy”, that’s just being paid to cushion the obvious blow.

On conservative bikini “scandals”

The Other McCain points and laughs at liberals attempting to create scandals out of very little fabric:

Conservatives are not only smarter and more patriotic than liberals, we’re also better-looking. It’s high time we stopped letting liberals get inside our heads and tell us that it’s some kind of “hypocrisy” for conservatives even to acknowledge the existence of sex.

It is true. Even when liberal girls start out pretty, they rapidly end up making hags of themselves. There’s something about being angry and self-righteous all the time that seems to warp a woman’s face as well as her soul. Meanwhile, Cassy Fiano explains the liberal thinking, such as it is, behind these “scandals”.

They like to paint conservatives as frigid, dried up, ugly old prudes, and of course, that couldn’t be further from the truth. And they hope that showing pictures of a conservative — or their family members — in bikinis will mean that other conservatives will be outrageously outraged. They’re always shocked when bikini photos do not, in fact, derail conservative candidates’ campaigns.

It seems that more than a few left-liberals have failed to understand that the American Taliban metaphor was, in fact, a metaphor. So, chalk me up a supporter of pretty conservative women in bikinis. However, I find libertarian women to be the most attractive. They’re smarter, more interesting, and much more fun than their pretty conservative counterparts.

Blowing more futility

For once, I agree with Megan McArdle:

If you want to know why us libertarian types are skeptical of the government’s ability to prevent housing market bubbles, well, I give you Exhibit 9,824: the government’s new $1000 down housing program. No, really. The government has apparently decided, in its infinite wisdom, that what the American economy really needs is more homebuyers with no equity.

While McArdle wouldn’t know what a real libertarian was if Murray Rothbard’s zombie bit her on her bony ass – she actually voted for Soebarkah – she is correct to point out the madness of this homebuying incentive program. It does not help the economy to encourage more poor people to buy homes they cannot afford to buy and take out mortgages on which they will almost surely default.

Glenn Reynold’s succinct summary is more astute: “These people are idiots. Idiots who’ve been entrusted with nuclear weapons, and their economic equivalents.” Of course, this insane program might not exist if “libertarians” like Megan McArdle hadn’t voted the people who created it into office.

Men work more

Although I very much doubt this “news” is going to suddenly bring about an end to feminist whining, much less feminism itself:

The long night of modern feminism might be about to end. A glimmer of light is flickering in the encircling gloom. A study published this week by Dr Catherine Hakim of the London School of Economics has found that men do slightly more work than the women they live with when employment and domestic work are measured together.

This is the first time I can remember in 40 years that an authoritative study on a key issue of so-called gender politics has come out with a self-evident truth that runs directly contrary to orthodox feminist ideology. The fact that it has been written and published by a woman makes it even more delightful.

Clearly Dr. Hakim doesn’t understand how social studies involving gender work. If the data shows that men work more in total, then quite clearly paid work outside the home shouldn’t count. The rule is always that whatever permits women to pose as the victims of patriarchal male oppression must be the relevant metric. If a man travels via ox-drawn cart on a business trip to train coal miners in Minsk the proper way to break rocks with a pick while the woman stays home watching their 23 year-old daughter, the correct interpretation is that he has enjoyed a paid European vacation while she has slaved away caring for the children at home.

If, on the other hand, a woman flies to Miami to lie on a beach with her old friends from college while the man stays home to care for their five children under the age of two, the correct interpretation is that he’s been having a grand old time sitting at home drinking beer and watching television while the poor woman is absolutely worn out from an exhausting week of being dragged to all sorts of social activities in which she most certainly did not want to participate. (Roissy, of course, would put a different spin on why she’s so worn out, but that’s beside the point here.)

The lesson is this: solipsism is best avoided, because it makes you look insanely stupid to anyone who isn’t equally solipsistic. But that somehow never stops the feminists.

The limited debate

The NYT doesn’t know what a real deflationista is:

The split between the chief economists, whose work helps inform trading strategies recommended to investors by their firms, echoes a broader and sometimes fiercer debate among academic economists and commentators about the threat posed by deflation and what the government’s response should be.

According to the deflationistas, as they are nicknamed, a new round of stimulus spending by Washington is urgently required to stave off a Depression-like cycle of falling prices and wages that is difficult to reverse once it is set in motion.

Inflationistas, by contrast, worry more about the effect that additional government borrowing could have on the recovery. With the budget deficit expected to hover around $1 trillion a year for the next decade, they say, interest rates could eventually surge, making borrowing — and goods — more expensive. A double dip, they say, is highly unlikely.

This isn’t a genuine inflation vs deflation debate, it’s merely an intra-Keynesian one that completely misses the points made by the hyperinflationists and the true deflationists alike. A true deflationista is someone like Bob Prechter, who has long predicted that neither fiscal nor monetary policy can possibly prevent deflation brought about by the collapse of credit. The real debate – although it is more a question than a proper debate – is whether the central banks can print money faster than credit collapses in a fractional-reserve, debt-money system.

Given that there is $53 trillion in total credit market debt compared to $8.6 trillion in M2 and the mainstream deflationary fears have been caused by total credit merely remaining flat for the last two years thanks to the heroic debt-creation measures of the Soebarkah administration and the Federal Reserve increasing M2 at an annual rate of 5 percent, the outcome increasingly appears to favor the real deflationist camp.

Corrupt like a senator

Washington beats the market:

A 2004 study of the results of stock trading by United States Senators during the 1990s found that that Senators on average beat the market by 12% a year. In sharp contrast, U.S. households on average underperformed the market by 1.4% a year and even corporate insiders on average beat the market by only about 6% a year during that period. A reasonable inference is that some Senators had access to – and were using – material nonpublic information about the companies in whose stock they trade.

I suppose they’re just all super-skilled econ-savvy investors, but their performance during the ongoing financial crisis argues convincingly against that.