Re: but still?!

[Michael Perelman <michael@xxxxxxxxxxxxxxxxx>]

Rakesh, what you say about Keynesianism is correct.  Keynes himself expressed
indifference about the source of spending, but I suspect that he was engaging in a
rhetorical flourish.  Also, the Repugs are far from indifferent in the sort of
spending that they will countenance.

Regarding your last question, Ross Perot won the election in 1992 and has not yet
been dislodged.  As Max has shown, the Dems have managed to equate fiscal
stringency with saving social security.

On one point, I differ.  I doubt that anybody abandoned Gore because of his pure
fiscal stringency.

Rakesh Bhandari wrote:

> I know this will read as nit picking but when Mat writes:
>
>  Bush pushes tax cuts (for wrong
> > reasons and targeted to wrong sectors, but still)
>
> i don't there should be any "but still".
>
> for it implies that  Bush's hyper commercial keynesianism is *functionally*
> equivalent to say a galbraithian liberal expansionism--to use Lekachman's
> terms-- and thus to be preferred over the democrats' orthodoxy. it's this kind
> of argument i believe that led some here to abandon the democrats only to allow
> bush to win by casting a symbolic vote for nader (note: i am not arguing
> against abandoning electoral politics or parliamentary socialism as herman
> gorter and anton pannekoek described it).
>
> at any rate, this "but still" attitude towards the republicans strikes me as
> politically pernicious.
>
> first, it reveals the positivist muck of keynesianism. Two different political
> programs are indistinguishable towards the goal of full employment. One would
> have to prefer military keynesianism over orthodoxy. Where do values other than
> full employment come into the analysis? Are they just an after thought once the
> positivist keynesian scientist has done his technical analysis?
>
> second, mat is making too much of the stimulative effects of bush's tax cuts.
> if you believe the fundamental keynesian psychological law, there should hardly
> be any multiplier from this obscenely regressive tax cut. there should in fact
> be massive leakage; it would have been better to keep the money in the govt's
> hands and pushed the democrats to cheat on their pledge to use the surplus only
> for debt paydown.one could trusted the democrats to break their promises
> of fiscal rectitude, and spending had indeed increased in relative terms in the
> last couple years of bubba's rule.
>
> Plus, even if bush allows for deficit financed govt expenditures, it will be
> for  an expansion of a capital intensive military at the expense of social
> programs which should greatly boost the mpc...so one should expect a small
> multiplier  from the kind of spending which bush is planning.
>
> there should be no "just still" about bush in my opinion. it opens--nay has
> opened--the door to reaction.
>
> lastly, i think the real question remains why both parties are so commited to
> keeping a lid on spending, i.e., why are they acting like govt expenditures are
> no better than a destruction of capital. Why doesn't bush just allow the
> surplus to be spent and then borrow more for spending on say rumsfeld's pet
> projects? why are the democrats so scared of using the surplus for anything but
> debt paydown. why does the mixed economy seem to have reached its limits, no
> matter the party in charge?
>
> Rakesh
>
>

--

Michael Perelman
Economics Department
California State University
Chico, CA 95929

Tel. 530-898-5321
E-Mail michael@xxxxxxxxxxxxxxxxx