What's the best model for economic growth right now?
The China model? The Japan/Korea model? Or the post-Communist Poland/Czechia model? Or something else?
I think it is the model of the basic income. Supplemented with work. This sort of thing stands the strongest.
>>1364457
Well if you want to industrialize...
Its state capitalism all the way.
Ur madre, senpai
Why not be real? More automation = the people just get money and a workload that is real in 200000000000000000 years. At least.
>>1364457
>japan
>growth
>right now
????
Germany are doing stupidly well too
>muh growth
It's not everything in this world, you know. Stability has a value too.
I am not pointing to these people, but to the space. Right now a minority collects what a majority generates. If this is changed, anyone for a view this would not mean enormous interstellar growth? This is just most powerful and agreeable to all. It is not that a group would be left behind so that there would be reason for disagreement.
And this is not typically left.
>>1364457
>implying you can control exogenous phenomena such as the total factor productivity
If the majority becomes as rich as the rich, it will lead to solutions like certain products must be available to all. It does not cost anything extra to produce certain kinds of cars.
Take Ferrari: this is a type of car that actually isn't really a car. It does not drive as other cars. Actually you must always have a mechanic if you have a Ferrari.
So this would mean no more Ferrari or extremely improved cars from this brand. No Really improved.
And houses: how would it be with building materials and room if you'd look at what can be produced a lot. In a system that focusses on it having all desired qualities and being available. And space is an issue.
But say building materials. Wouldn't this be only technical to produce as desired?
And space? There are vast lands in the world that are broad, lengthy and empty. And seem to go on and on and on.
And less motivation because of less dependency on work. Or motivation. Some common thought is that it could cost too much of this. But why would it? This can be researched. Though personally I wouldn't trust any research. About this it must be verifiable that the results are correct.
As far as I see this motivation thing will even be far better. Because this is the working of this sort of system. It unleashed enormous powers.
>>1364561
It unleashe-S-. A typo.
I said verifiable, so to anyone. At best. If possible. Like no one would trust his neighbour or anyone else with an enormous part of his fortune.
>What's the best model for economic growth right now?
Whoever has the highest growth rate right now, obviously.
>>1364501
>What is R&D and scientific management.
>>1364581
It's not that simple. One reason being that it could be short term or unsustainable growth.
>>1364457
If you're the leader of a bumfuck poor state, then the Beijing consensus is the way to go at the moment, but the effectiveness of this would be heavily dependent on economic capacity and semi-capable governance
>>1364457
Soviet Stalinist economy was never surpassed, you know.
The only problem is that IMF gonna have kittens, if you attempt to repeat it.
>>1364649
>The only problem is that IMF gonna have kittens, if you attempt to repeat it.
What do you mean by kittens?
>>1364649
>Soviet Stalinist economy was never surpassed, you know.
How was this never surpassed? As far as I know this was one of the worst economies thinkable. Not what it said it was and totally unmerciful.
>>1364465
>>1364649
>Soviet Stalinist economy was never surpassed, you know.
Free markets, free trade, limited to no government
>>1365127
>austrian school
>>1364465
These things that I posted here, no one really ever has anything better to do. But to make this happen. If it is this nice thing, it can actually succeed.
>>1365144
The only school of thought to have never been wrong yet
>>1364457
It depends on the country and its current level of development, its resources and the indicators one uses to measure economic growth (pure GDP versus overall welfare as in decline in scarcity, low levels of unemployment and high life expectation etc). In the (old) China model, we are now seeing the limitations of growth driven by cheap exports and foreign investment, as global demand has dropped, it now has a lot of overcapacity in various industrial sectors. Furthermore, it is now dealing with its neglect of the environment, which will take its toll on the health industry. Such a model should thus not be replicated.
>>1364617
Untrue, although China's policies were great at the time, it cannot be currently replicated. The developed nations' demand for cheap labor and products is declining. My first thoughts would be to develop the nations infrastructure to boost domestic trade, maintain a stable economic climate for investors, develop services sector.
>>1365149
Rothbard debunked the NIT/basic income idea decades ago. Each coming generation would have further incentive to take less stressful jobs leading to lower real wages and lower GDP in the long run. This would lead to people needing a higher amount of basic income and the cycle would continue until either the mountain of debt is too high to continue and the real private sector wages are unable to fund it
>>1365152
the OP is about models for economic growth. There is only a limited domestic market for firms to be able to grow, and to access foreign markets demands investments in infrastructure that private firms cannot individually afford. Furthermore, having limited or no government sounds like a lot of instability and also would mean mass exploitation of workers which probably erupt in (civil) war and thus hold off foreign investment
>>1365070
i think what he's saying is that stalinist industrialization was the best break-neck industrialization drive in modern history. The Soviet's total victory in WWII is proof of it.
>>1365175
Yes because look at all the civil wars and exploitation going on in Hong Kong!
fiscal haven is the most effective by far.Useless little villages like Lichestein have become the wealthiest countries in the world per capita due to this.
>caring about broad meaningless statistics
This is why you always be cucked by the government
>>1364457
Mixed markets, such as those found in Europe and America, with a balance between private industry and state intervention. We've tried both unhindered free markets and total state control, neither outperforms a balanced approach in the long run.
>>1365262
>We've tried both unhindered free markets
When?
>>1365262
The closest thing to a libertarian society that's ever existed was midieval iceland and reading about just makes you wonder how wonderful it would be if we applied it to today https://mises.org/library/medieval-iceland-and-absence-government
>>1365184
An oversized offshore banking sector leads to vulnerability though, much like being overdependent on a natural resource. Look what happened to Iceland and Cyprus.
I do agree that it's one of the best ways for a tiny country to outperform.
>>1365307
>Iceland and Cyprus
None are fiscal havens.FIscal havens usually create high paying jobs,and diversifies the economy in the long run.I mean Ireland is a nigh fiscal haven,and it made them wealthier than the UK for their first time in history.
>>1365283
Gilded Age? Free markets can build up a lot of wealth very quickly, but they also lead to terrible social inequality which in turn leads to social unrest. Turns out, even the rich are better off if some of their profits go to the masses.
>>1365334
>Gilded Age
As far as I know it was one of the periods of greatest economic growth in history.
>>1365127
monetarism is god tier, austrian school has too many memes
>>1365334
That was an amazing period of growth, and keep in mind that was after Lincoln wrecked the South's economy, started tariffs, created the income tax, and centralized the banking system even further. Imagine how amazing the growth would've been if the market actually was freer
>>1365362
>monetarism is god tier
It's too bad Greenspan single-handedly caused the housing crisis in 2008 ayy lmao
>>1364457
The E. Coli model.
>>1365301
Medieval Iceland was basically a bunch of tiny villages. Less than 50k people on the entire island, and most of them lived in autonomous hamlets. Reyjavik only had 600 people in 1800 and still barely 10k people at the beginning of the 20th century.
What worked for a medieval village that no one bothered to invade might not work for a modern state.
>>1365320
>None are fiscal havens
According to the Heritage foundation, Iceland is now roughly on the same level as Luxembourg in "economic freedom", even if it hasn't gone back to pre-crisis level.
Cyprus is not exactly a tax haven but:
https://en.wikipedia.org/wiki/Economy_of_Cyprus#Role_as_a_financial_hub
Also:
"The Cyprus legal system is founded on English law, and is therefore familiar to most international financiers. Cyprus's legislation was aligned with EU norms in the period leading up to EU accession in 2004. Restrictions on foreign direct investment were removed, permitting 100% foreign ownership in many cases. Foreign portfolio investment in the Cyprus Stock Exchange was also liberalized.[31] In 2002 a modern, business-friendly tax system was put in place with a 10% corporate tax rate, the lowest in the EU. Cyprus has concluded treaties on double taxation with more than 40 countries, and, as a member of the Eurozone, has no exchange restrictions. Non-residents and foreign investors may freely repatriate proceeds from investments in Cyprus."
In fact, given its location, shipping sector, fossil fuel sector and other factors, Cyprus is basically a failed Singapore.
>FIscal havens usually create high paying jobs,and diversifies the economy in the long run
And this didn't happen in Iceland and Cyprus?
>>1365159
Pretty much.
We are entering an age low growth and low demand.
Poor developing countries are fucked.
China (and the BRICS) pulled the manufacturing-led development ladder up with it.
>>1365180
Hong Kong is a result of being the only free market in China.
It feeds off of China's corruption. And now that China is liberalizing and modernizing, HK is slowly going down a long long hole.
>>1365423
>Luxembourg in "economic freedom"
Totally pointless.Chile is not a fiscal haven and is ranked 7.Australia is not a fiscal haven and is ranked 5.
>And this didn't happen in Iceland and Cyprus?
Iceland is pretty succesful and none are a fiscal haven m8
whatever gets the most technological progress and productive workers
>>1365441
And?It was still one of the most prosperous period in the US history,and recieved tons of migrants because it had beter wages than most of Europe.Putting as an example of failure is dumb as hell
>>1365149(Me)
It can be that it takes a generation for it to succeed. Though as far as I see there are reasons why this does not have to be a problem.
>>1365168
All in all is a system whereby there is this kind of equality in income this powerful that its failure can be doubted. If you look at examples this should be clear. Personally I want to say: it is 100% certain that this is the most powerful and successful kind of system. But that is not how it works immediately in saying this sort of thing.
Some other thing is how to start it. It must be built in a correct way.
>>1365441
Hey, you were the one who claimed the gilded age was "free marker" not me. I was telling you that if there was free banking, free trade, no income tax, and the North hadn't depleted the economy of the South then MAYBE you would be able to associate it with something close to a free market
>>1365483
>led to the reactionary fervor of the Progressive Age and eventually to the Great Depression.
How does this descredit the Gilded age?Either way the Great recession had a lot of causes,and the gilded age was just pure economic progress,with a population and economic boost
>>1365483
Cont*
Essentially GDP growth is not all there is to "progress".
Social stability is just as needed. Actually, even more so.
>>1365176
I don't know anything about how the economy worked exactly when Stalin ruled Russia. Basically I know that it was very painful to most people.
I am thinking of something that is right wing, and left wing based. And not just that. As well as other political positions.
>>1365473
>its failure can be doubted
https://en.wikipedia.org/wiki/New_Harmony,_Indiana
And this one had the support of a millionaire behind it to subsidized it
>>1365505
Even without reading it, I can say that this is in no way deciding.
>>1364617
The book I'm currently reading at the moment, called capitalism with Chinese characteristics published by Cambridge suggests that the Beijing model meme is just a meme and not such a huge success. One problem is that it discriminates against local private companies in favour of foreign companies. A lot of the success of local companies such as lenovo was due to the fact that they had an extremely free capital market on its doorstep - Hong Kong.
It's pretty amazing what some peasants do, one got his family to buy two fridges from HK, he tinkered with them, set up a company that was eventually able to outcompete an American company. The legal maximum number of employees was 7 but he managed to get thousands.
>>1365511
How was it unstable m8? Millions of migrants came to the US every year due its high wages,and scholarization skyrocketed
>>1365515
>is in no way deciding
What do you mean?It was a place with total equity,that failed horribly,despite a millionaire throwing millions of dolars onto it.
>>1365473
>it is 100% certain that this is the most powerful and successful system
It has literally never been tried before you have no basis to say this. We have seen other welfare states however to look at and show us that the real income of the poor in lowered every passing generation leading to a continuation of leeching. This is the unfortunate state of blacks in the US who refuse to get educated and take real jobs because they can combine their welfare and minimum wage jobs to live semi-comfortably anyway
>>1365511
I suddenly feel as if talking bad about Russia. And I don't mean to do this. The first thing about this is, I think, that as far as I know this is not their habit.
>>1365176
Being able to mass produce tanks isn't exactly welfare maximising. The south Korea model should be preferable with a market system in place but the government provides cheap loans to businessmen who have to complete internationally with the government supporting the winners. This was quite necessary as there was a capital market failure. Free markets don't work if there is no market at all.
Also with Stalinism there was a large trade off between current consumption and future consumption. He essentially impoverished one generation so that an other could be better off. Some compromise is needed.
Technocratic Franquism
>>1365544
The SK/Japan/Taiwan model is literally China's model + US aid and preferential trade deals.
Look it up.
>>1365561
>All those changes caused the future instability that nearly destroyed America.
No. The great depression were just banks giving too easy loans and people misinvesting. And this was mainly due the Fed created in 1913
>>1365558
That info graphic is dreadful.
It's almost as bad as the "anarchists increased production in catalonia" meme with no evidence behind it.
>>1364457
F R E E
T R A D E
>>1365578
https://en.m.wikipedia.org/wiki/East_Asian_model_of_capitalism
Probably the best model for development in homogenous nations
>>1365526
I think it is interesting to have look at. But I just know that the mistake was...er...(I'm not reading it, but thinking)...What is THE mistake in that sort of thing.....?
Well, first of all, it is not "done" to say it, but it could be something that is just untrustworthy altogether.
Further...I don't know I would have to read it.
>>1365581
No. The Fed was way too tight.
That alongside the FREE MARKET bubbles caused the GD.
>>1365585
Thanks Mr. Goldstein!
>>1365585
>no evidence behind it.
The 60's had an average growth of 7% for Spain,and all the data comes from official sources. Deal with it commie.
>>1365597
>The Fed was way too tight.
>That alongside the FREE MARKET bubbles caused the GD.
The debt bubble was caused by the Fed. People could take loans like crazy,and they just took said loans and putted them on the stock market. The Fed fucked up later after the bubble exploted, but that is another discussion
>>1365604
>let me just ignore 1939-1960 when everyone except Spain was booming
>>1365611
>The debt bubble was caused by the Fed. People could take loans like crazy,and they just took said loans and putted them on the stock market.
(Citation needed)
2008 != 1929
>>1365379
>government backing toxic assets
>monetarism
>>1365620
He kept the interest rate too low for too long you moron, he caused the mortgage market to become "toxic"
>>1365619
Keynesian retard detected
>>1365613
Yes,the rest of the world embargoed Spain,and it still grew faster than during the republican period. When sanctions were lifted Spain exploded economically and pushed over half of its population into the middle class in 10 years
>>1365526
Money in it = it will work no. If it is in order it will be visible before it starts that it will work.
>>1365632
https://en.m.wikipedia.org/wiki/Causes_of_the_Great_Depression
Find your argument with a citation here
How about this view:
The left is interested in improving the right.
>>1365650
>Keynesianopedia
Nice try Krugman
>>1365633
It grew faster than during the GD and civil war???? Wow!
>>1365619
https://fee.org/articles/the-great-depression-according-to-milton-friedman/
If you are interested,this is a dummary of one of Friedman's books. The Fed lowered the rates before the great depression
>>1365667
Spain wasnt affected very little due the great depression. The only period that grew as much as it did with Franco was with Miguel Primo de Rivera
>>1365628
Banks like Lehman Brothers collapsed because they invested in sub-prime mortgages repackaged as MBSs, CMOs and CDOs which hid the risks involved. Ordinarily these institutions would never do something that is the equivalent of putting all their money into high risk penny stocks, but regulators gave them the OK and government sponsored enterprises like Fannie May and Freddie Mac were also involved.
Low interest rates were a factor, but alone the housing bubble wouldn't have been as severe and rates slowly increased back to sensible levels for a few years beforehand.
>>1365669
You seem to think fed interest rates are actually powerful.
>>1365180
Kill yourself
>>1365690
They are literally the only factor in the quantity of money in the economy and the ratio of how people invest, save, or spend it
>>1365722
Lmao hell no wtf
>>1365731
This is not even a biased viewpoint, that is literally what the federal reserve does and how their monetary policy influences the economy kid
>>1365669
Friedman stated that the feds contractionary monetary policy caused a normal recession to turn into the great depression due to a decline in the monetary base. Lowering interest rates is generally a sign of an expansionary monetary policy, which ought to help in the case of a recession.
>>1365703
>>1365632
There is nothing wrong with Keynes, unless if it's blatant vulgar Keynesianism. To quote Nixon/Friedman "we are all Keynesians now".
Only Austriatards disagree.
>>1364457
Mixed market capitalism, like always.
China's rise is impressive, but filled with state-heavy debt and money shuffle magic.
Japan has negative interest rates and is on its way to irrelevance.
Germany is the answer. If they didn't have someone as imperious as Merkel and a few others, they could have actually made something of Europe.
>>1364501
>calling friedman a meme
This is correct.
>>1365793
>nothing wrong with Keynesianism
>>1365810
>thinking Bernanke gave a fuck about economic principles
He's just Alan Greenspan redux
>>1365810
Of course instead of building houses or something more socially desirable you have that dreadful strawman.
>>1365744
You actually think
>They are literally the only factor in the quantity of money in the economy and the ratio of how people invest, save, or spend it
Because if so, you are literally retarded.
>>1365796
The German model is built upon ordoliberalism which uses the state to build the conditions in which markets work like the hypothetical ones in models. Infact my own definition of free markets is free for the consumer, not the business owner and therefore markets are only free with anti-trust legislation and externality pricing etc. However ordoliberalism has its problems with regards to macroeconomics due to an obsession with supply and not enough emphasis on demand ( look at Europe for its problems ).
I'd call myself a proponent of free markets as they work well most of the time but I'm open to the state taking over when they don't work well ( I.e healthcare ). Some welfare is needed for capitalism to work best.
>>1365344
Not by any measurable standard except the nostalgia of neoliberals for a golden age that never existed. Those were "the bad old days" where extreme swings in the market was stifling growth due to uncertainty.
So much of the perceived "growth" that took place in this period was the natural effect of switching from an agrarian economy to an industrialized one, and when this happens growth is rapid even in countries that were ruled by autocratic governments with command economies, such as the Soviet Union.
>>1365796
>but filled with state-heavy debt and money shuffle magic
Is this a problem worth denigrating 40 years of 10% growth?
>>1365731
He is right. The government has a monopoly over currency, that is why it is called legal tender.
Factors like "le evil rich people hoarding" are superfluous. Every rich person wants to invest their money, even in periods of deflation it is only a matter of time before a good wholesome trader says "heavens above, this depression really has hit rock bottom, clearly God favors the South and it is my duty to buy up all these properties at firesale prices".
>>1365847
>using absolute amounts to compare time periods
Go kill yourself
>>1364457
>japan/korea model
just cuck my entire population up
>>1365853
His claim
>They are literally the only factor in the quantity of money in the economy and the ratio of how people invest, save, or spend it
is objectively wrong.
Explain fucking Japan.
>>1365823
>Of course instead of building houses or something more socially desirable you have that dreadful strawman.
Keynes said that digging and filling ditches,the economy could be restimulated
>>1365847
Fuck off with blaming neoliberalism.
Here's neoliberalism for you:
http://www.econlib.org/library/Columns/y2010/Sumnerneoliberalism.html
>The neoliberal revolution combines the free markets of classical liberalism with the income transfers of modern liberalism. Although this somewhat oversimplifies a complex reality, it broadly describes the policy changes that have transformed the world economy since 1975.
Scandinavia is an example of neoliberalism since the late 1980's. ( Maybe not Norway cause of all of that sweet oil ). it's the synthesis of classical liberalism and "modern liberalism ( US definition)".
Not some evil right wingers à la the republicans who have done more to discredit the concepts of free markets than anyone else with their rand and rothbard bullshit.
>>1365858
I know. I know, mathematical models are an anathema to neoliberals who base their own model on "muh freedums"
>>1365847
>Not taking inflation into account
Do you seriously believe this crap.The real purchasing power has barely grown since the 60's
>>1365871
>Not spotting sarcasm
Hold on I'll find the page in the general theory.
It's theoretically possible but not as good as something more productive.
>>1365872
You really shouldn't move goal posts, anon, all it does is discredit you
https://en.wikipedia.org/wiki/Neoliberalism
>Neoliberalism (or sometimes neo-liberalism)[1] is a term which has been used since 1938,[2] but became more prevalent in its current meaning in the 1970s and '80s by scholars in a wide variety of social sciences[3] and critics[4] primarily in reference to the resurgence of 19th century ideas associated with laissez-faire economic liberalism.[5]:7 Its advocates avoid the term "neoliberal"; they support extensive economic liberalization policies such as privatization, fiscal austerity, deregulation, free trade, and reductions in government spending in order to enhance the role of the private sector in the economy.[6][7][8][9][10][11][12] The implementation of neoliberal policies and the acceptance of neoliberal economic theories in the 1970s are seen by some academics as the root of financialization, with the financial crisis of 2007–08 as one of the ultimate results.[13][14][15][16][17]
>>1365176
>Soviets were unable to provide enough gear or food for their soldiers
>had to rely on billions worth of aid from the British and Americans
>USSR STRONG!
>>1365877
Look closer at the charts, dumb ass. Both of the ones I posted are adjusted for inflation.
>>1365847
If that graph was plotted on a logarithmic scale you would see that % growth was quite high.
If a 19th century factory worker saw annual earnings increase from $1500 to $3000 in 20 years, this is much higher growth than someone seeing incomes rise from $30000 to $40000 between 1980 and 2000, although arithmetically the growth is higher.
Competitive capitalism
Flat income, low government spending, free trade, deregulated private sector
>>1365901
Flat income tax*
>>1365883
Our two sources aren't mutually exclusive, at least at defining neoliberalism . Sweden and Denmark both privatised, cut public spending, deregulated, they already had free trade.
>>1365847
http://data.bls.gov/cgi-bin/cpicalc.pl?cost1=5000&year1=1913&year2=2016
If you plug 5000 dollars on 1913,see the results.
>>1365873
Are you seriously utilizing absolute growth instead of percent growth to compare time periods?
You're like one of those idiots that uses nominal wages to claim Americans are better paid now than 20 years ago.
>>1365884
How is that an argument that the Soviets didn't industrialize quickly?
>>1365914
The purchasing power of an individual dollar becomes less important when people have more dollars to spend.
Inflation in controlled amounts is normal and healthy: when your population increases, you need a larger supply of money
>>1365913
In no way are Sweden and Denmark following a neoliberal economic system.
They liberalized their economies in the 90's.
But they did not make their economies neoliberal.
Neoliberal = UK
>>1365932
>The purchasing power of an individual dollar becomes less important when people have more dollars to spend.
yeah, but if 5000 dolars(average wage in 1913), would be worth 120k$ today,and the average wage is 55k$,there is an obvious decrease in purchasing power
>>1365935
Denmark has a privatised fire service. That seems more neoliberal that the UK. Both have very unregulated labour and product markets. Both have no minimum wage I think. Sweden has no inheritance tax. The scandies are some of the most neoliberal economies on earth.
>>1365918
Growth was faster because of industrialization, for the same reason why China is technically growing faster than the U.S.: subsistence farmers moving into factories see their living conditions improve substantially more than when factory workers transition into service sector work.
It's by no means a vindication of Gilded Age policy: when you look at this chart you can see in no unclear terms just how volatile and unstable the market was, how growth was rapid but punctuated by truly crippling market crashes, because that's what happens when your markets are under-regulated.
>>1365963
You don't need extra regulations. You need a counter-cyclical monetary or fiscal policy.
>>1365963
Small crashes in the economy are prefferable,than substaining bubbles until they totally destroy the economy,when they pop,which is the result of some regulations
>>1365980
>counter-cyclical monetary or fiscal policy.
Which they thought would lead to unlimited growth in the early 1910's through the late 1920's and was tried again in the mid 1980's and crashed and died horribly in 2008. Even Alan Greenspan admitted that it wasn't enough
https://www.theguardian.com/business/2008/oct/24/economics-creditcrunch-federal-reserve-greenspan
>>1365951
Why don't you tell me where Denmark and Sweden rank in government spending as a percent of GDP and the Economic Freedom index?
Your evidence is to cite a few pieces of the economy that were liberalized, while ignoring the vast majority that was not.
>>1365995
>Small crashes
Look closer at that chart. Those weren't "small" crashes, those were gargantuan ones. Economic bubbles form even when the U.S government had adopted a hands-off policy towards the economy.
It's true that sometimes burdensome regulations can cause bubbles followed by crashes, but these are tame compared to the crashes that took place in the economic wild west. And there is certainly no historical precedent for "the big one" that neoliberals keep insisting is right around the corner
>>1366009
Crashes don't really matter. The worst crash ever was the result of government intervention. I'd rather have boom and bust than stagnation.
>>1366017
>Crashes don't really matter.
You say that like you've never seen your life-savings disappear overnight thanks to a run on the bank
>>1366009
Crashed are inevitable in any economic system but would be fixed by itself if the interest rate would be able to adjust naturally to market conditions and if there was not fractional reserve banking
>>1364467
This
The planned economy allows for the most steady and constant growth, as long as you focus your planning right
(What made the USSR shit the bed is they got so obsessed with heavy industry and the military that consumer goods were harder to come by. If they made more cars and less tanks, more toys and gadgets and fewer missile defense systems they'd probably still be around today and the slavs wouldn't be poor as fuck
>>1366024
I assume you're talking about
>The problems (and benefits) of the Gilded age directly led to the reactionary fervor of the Progressive Age and eventually to the Great Depression.
Which I agree but only to a point: the Progressive era died in the aftermath of WWI and was replaced by a series of Paleoconservative era, defined by the do-nothing-ism of Warren Harding, Calvin Coolidge, and Herbert Hoover
>>1366033
Yes, that's the standard neoliberal talking point that completely and utterly failed to anticipate the crash of 2008, as admitted by one of its staunchest defenders
http://www.washingtonpost.com/wp-dyn/content/article/2008/10/23/AR2008102300193.html
>>1366033
>would be fixed by itself if the interest rate would be able to adjust naturally to market conditions and if there was not fractional reserve banking
This is taking free-market fundamentalism to a whole new level.
Why wouldn't fractional reserve banking exist, short of banning it?
It depends what kind of growth you want
>In the moment, strongest growth, in the long run unsustainable though
Neoliberalism
>Steady growth with slight dips but a safety net
Keynesian social democracy
>Sustainable growth
Planned economy/Soviet style economy but better planned with hints of positivism (Which essentially already exist in Stalinism..
Equal growth:
Market Socialism, Yugoslavian socialism with a more stable macro economy and tax structure.
>>1366075
Are you actually retarded? The 2008 crash was caused by Keynesian/ slight Monetarist policies. The interest rate was kept too low for too long and the fact that the government helped guarantee loans to poor people they knew couldn't pay it back all helped contribute to the housing bubble which eventually popped. It had nothing to do with "greedy free market scrooge mcduck types" contrary to what the young turks might have told you
>>1366101
>Planned economies create sustainable growth
Mises debunked this in fucking 1920 with the economic calculation problem
>>1366109
>Are you actually retarded?
No, I'm just not clinging to the sinking ship that is neoliberalism.
> The 2008 crash was caused by Keynesian/ slight Monetarist policies.
Not according to Alan Greenspan
http://www.npr.org/templates/story/story.php?storyId=96070766
>Under questioning from Democrats on the panel, Greenspan conceded he might have been, as he put it, partially wrong in not moving to regulate trading of some derivatives that are among the root causes of the credit crisis. He also admitted his free market ideology may be flawed. This exchange with committee chairman, Democrat Henry Waxman of California, verged on the metaphysical.
>>1366111
>How does being in the government magically make you superior at planning the economy.
How do your problems magically go away by "doing nothing"? Do you just pretend that they don't exist?
>>1366143
>How do your problems magically go away by "doing nothing"?
The economy usually reorganizes itself.Most advanced economies are not planned.
>>1366143
not an argument
>>1366149
>The economy usually reorganizes itself
lol
Basic income for everyone. Extra income for part-time work. Significant extra income and voting rights for people who work full time.
>>1366101
Neoliberalism is not sustainable.
>The neoliberal revolution combines the free markets of classical liberalism with the income transfers of modern liberalism. Although this somewhat oversimplifies a complex reality, it broadly describes the policy changes that have transformed the world economy since 1975.
Fuck this stupid left wing "neoliberalism is bad meme"
>>1366157
>lol
Yes,the UK economy did it,the baltics economies did it,the Chilean economy did it and Spain is currently doing it,eventhough they could have done it faster if they went full Estonia.
>>1366132
>No, I'm just not clinging to the sinking ship that is neoliberalism.
It's hard to cling to something that doesn't exist, buddy.
>>1366173
>the Chilean economy did it and Spain is currently doing it
lol
Post-WW2 Japan and Germany.
Wealth, capital, labour depleted, government and infrastructure destroyed. Yet in a couple of decades, you've got #2 and #3 economies in the world.
>>1366191
Nice argument m8.Those economies have been diversified,and are growing after a recession,whie countries like France that have the biggest interventionism in Europe is stagnant.
>Argentina
You mean the country that had the highest inflation in the world after Venezuela, and the economy is basically bureaucrats?It is hard to make Argentina work with people like Kichner.Mexico has been doing fine in the last 20 years,and is becoming wealthier every year.
>>1366229
>and the economy is basically bureaucrats
What is every neoliberal economy ever for 200, thanks alex.
>>1365500
>I don't know anything about how the economy worked exactly
>I know that it was very painful
Typical commentary on the USSR.
>>1365922
The Soviets did industrialize quickly, but that wasn't the issue. The poster said that the Soviet's victory in WWII was due to their industrial abilities. That clearly isn't the case, since they were unable to sustain their war machine without foreign help.
>>1366238
Do you know what neoliberal is? Or you are just one of those lefties that just uses buzzwords to look himself look cool
>>1366268
>since they were unable to sustain their war machine without foreign help.
lmao. Source on this? I'd love to see how you came up with this one. "Yeah sure you had industry, but you didn't have REAL industry, maaan. Those tanks were imaginary."
The cult of the lend-lease act just get bigger and more audacious by the year it seems. Gotta protect the ego of America at all costs.
>>1365505
https://en.wikipedia.org/wiki/New_Harmony,_Indiana
This is something that stems from 1800. A completely different culture as now.
Do you know this specific article about it? Where does it say it failed?
This was all about the investor. Imagine those people from the 1800s. They think potatoe, not blablabla /fancy word/ social experiment reform.
This sort of thing must be based on the intelligent beneficiary.
This is not an example.
>>1366238
>Not knowing anything about neoliberalism
Fuck off left wing maymays
>>1366496
>A completely different culture as now.
Still proves that it is not sustainable
>Where does it fail?
It collapsed.Owen bought a city to build his Utopia,and it ended in hunger and violence
>This is not an example.
Still proves that equal pay doesnt make societies ssutainable
>>1366549
Still interesting. I think it is a good example of a known experiment.
It does not represent what I wrote. So this does not prove it. One thing is a correct ratio between basic income and income from work.
And that it is done by the majority in an intelligent way.
So now what would be a reason that it would fail?
>>1365533
>This is the unfortunate state of blacks in the US who refuse to get educated and take real jobs because they can combine their welfare and minimum wage jobs to live semi-comfortably anyway
How is it unfortunate if they live semi-comfortably? Isn't the real problem that their priorities are fucked (and they expend their extra money on dumb shit) rather than the economic model?
>>1366664
I think so. I think they are afloat. Because of some nativity problem.
>>1366070
Didn't planned economy complete wreck African economies? Granted, they were managed horribly and corruption was the word but still.
>>1366177
>It's hard to cling to something that doesn't exist, buddy.
Keep telling yourself that. It will help you cope with irrelevance.
>>1366150
I play tit for tat. I respond to a non-argument with a non-argument
>>1365533
>>it is 100% certain that this is the most powerful and successful system
Still even havn't half a reason why it wouldn't be the most successful and powerful system.
Or
What reason would you need?
>>1366765(Me)
Havn't SEEN --typo
>>1366664
In many areas mom and pop stores are rekt by big businesses like Walmart. These mom and pop or locla businesses employ people at decent wages.
Walmart rekts them then employs all the now unemployed folk. The wages are really low so low that the employees qualify for welfare. Thus Walmart pretty much pays much less in salary because the government effectively provides the rest asubsidizes it.
> Isn't the real problem that their priorities are fucked (and they expend their extra money on dumb shit) rather than the economic model?
It's a ton of issue that effect the lower class in America. The education system in poor districts is one way.
It is not something that needs money all the time. In this typical way. From this majority to arrange it.
I'm interested in actually starting it. Looking for other people about it. Though this is not an helter skelter thing. Basically this is an interesting conversation about this or not.
>>1365473
>It can be that it takes a generation for it to succeed. Though as far as I see there are reasons why this does not have to be a problem.
It still does not have to be a problem. But it could also be more than a generation before it can really start 100%.
The China/Japan/Korea model is not repeatable, they couldn't have boosted their economies without US support. This is the key element that most people ignore in favor of random cultural attributes such as Confucianism that 50 years ago were used to attack China and Korea as keeping their societies backwards.
No America means no East Asian economic miracle(s).
>>1366149
no, when left to its own devices the rate of growth on capital outstrips the rate of economic growth, leading to capital concentrating into fewer and fewer hands, which leads to income inequality and deflation, which leads to capital flight and labor migration to greener economic pastures.
The west has largely been able to avoid this fate through economic colonialism, but that stopped helping us in the early 20th century, and it's not going to help us in 2016, either.
And every advanced economy is a mixed system, some degree of state-managed capitalism.
>>1366765
I just fucking explained it to you kid. Each passing generation would have a lower real income and lower real GDP leading to a need to raise this basic income until a few generations later when the system is completely bankrupt or we have a recession from such low purchasing power, whichever comes first. Read some Rothbard if you want to learn more about it
>>1366874
Income inequality isn't bad.
Poor people are objectively doing better than ever in every way.
>>1366912
>Income inequality isn't bad.
But too much chokes the life out of an economy.
And unless you take active mitigation measures, it always increases over time.
monetary policy: maintain low levels of inflation, a political culture that ensures any debt incurred yields returns in the same ballpark as long term annualized returns on the stock market
social welfare should be quite extensive though job oriented, getting people off the streets and into work
utilities and roads handled by local government and business partnerships
a tax system where people and businesses pay for what they use from the country
everything else handled by a completely unfettered free market, regulations for public safety and things, but no arbitrary or discriminatory regulations and taxes
>>1366942
Overall income inequality hasn't done that yet. It could become bad if there is too much of a liquidity trap at the top. If we encourage the rich to invest that money it isn't necessarily bad.
Also there is no real evidence that global inequality has increased.
>>1366902
It is such a THING. So if it is irritating I think it is best not to go on about it. Basically I think it is an interesting thing to discuss.
But this collapse: it depends on surrounding countries (?) and a realistic ratio between this basic income and this other part. Based on work. And some other surrounding factors.
What would be the reason that it is so sure that the power would flow out over the years?
Something I know is e.g the Ottoman empire or the Roman empire or the Eastern part of the Roman empire. They lost their, this exact power to the fact that they themselves did not or could not take care of their business. And they had a lot of land. Conquered. Or wanted to do this: the eastern part of the Roman empire.
>>1366942
Income inequality can get pretty bad but that's only in states that where like that or been like that since it's inception. In developed states it won't get so bad that getting daily necessities is a struggle and luxury items are pretty much a distant dream.
>>1366985
The evidence is actually overwhelming, if you're willing to look for it. Even the IMF now thinks so
http://fortune.com/2016/06/03/imf-neoliberalism-failing/
>global
global income inequality is dropping because of the industrialization of the 3rd world. factory drones make substantially better living than subsistence farmers and that doesn't change even in command economies. In post-industrialization economies, however, a larger and larger percentage of capital is concentrating into fewer and fewer hands, and large amounts of previously middle class families are experiencing downward mobility into the ranks of working poor, while the only thing keeping the really poor fed is government assistance.
>>1367215(Me)
And very important: it must be given the time it needs. No matter how long it takes before it works 100%. Even if it would be 5 or more generations. This is possible if all agree to the growth that is possible at that time. First of all this is clearance of this atmosphere.
Obvious stalling or too much pressure on speed is something that can not. This is logical. All this should already be included fairly in the status of the whole thing.
Post-WW2 Japan and Germany.
Wealth, capital, labour depleted, government and infrastructure destroyed. Yet in a couple of decades, you've got #2 and #3 economies in the world.
>>1367258
Germany yes Japan not really since you can't replicate it.
>>1367266
Could you clarify what you mean by "you can't replicate it?"
>>1365127
>>1367258
State capitalism.
the EU. I feel it all went too fast. Like Kaboom, there is a othercountrykin in your livingroom. I have some doubt whether through the door or not.
There is no one that has anything better to do then this. So how could this actually start being a thing?
>>1366973
Good post
>>1367315
>that pic again
Finish the full fucking sentence in that shit. Mises explains that Praxeology is based on Deductive reasoning. If you're going to attack an ideal do it fucking right.
>>1365344
But the creation of the railroads was a major driver of economic growth during the Gilded Age, and that was certainly supported by the federal government; loans, land policy, etc. To say that was an unfettered free market is just wrong.
>>1367415
>Deductive reasoning
Doesn't stop it from being magical thinking which relies on its own rhetorical self-consistency as an excuse to actively insulate itself from methodologies known to produce concrete results.
Like factual evidence and historical precedent. It turns the "muh freedums" argument into a secular religion.
>>1367308
Foreign aid was barely relevant in SK development.
>>1365796
>China model bad because public debt
>Germany model good because getting free money and infrastructure from USA
Not only does public debt not matter for debt in your own currency but wow you fucking clown you need to invest to create growth and the money has to come from somewhere.
>>1365871
>>1365810
Keynes is right here. The strawman being made is that Bernanke and Krugman are doing this with already existing money, while the government creates money as it spends.
When you increase the money supply to meet demand that already exists but has no way to express itself you're then increasing supply because the limit on supply and in the long and short run more goods are produced and more wealth circulates.
>>1367415
Deduction based on radical apriorism, as is defended by austrians, is perfectly summed up by "it's magic, i ain't gotta explain shit" actually.
>>1367025
>http://fortune.com/2016/06/03/imf-neoliberalism-failing/
10 bucks says you've never read the actual paper. It doesn't think that neoliberalism is bad.
Larger and larger capital concentrating into larger hands is not bad. That's the point. We know that it does. The problem is we need to limit how the rich use that influence as opposed to slowing the economy.
If measures to decrease income inequality take hold, pretty much all economists think that it will lower the growth of median income.
>>1364478
Germany abuses the hell out of the EU for their own personal gain. Poor EU countries are allowed to continue because they keep the Euro value down. Mass immigration of people expand the labor, tax payer, and consumer base. Adding people is the easiest way to grow GDP.
Manufacturing that is outside Germany, but inside the EU barely exists. Just look at what happened to the English car industry.
>>1365872
Stop posting this you illiterate retard. Econlib is just trying to redefine terms, what you're describing is social democracy not neoliberalism. Since neoliberalism is an abject failure the last tactic left is to redefine it as something that worked.
For fucks sake.
>>1368077
To be fair, wealth by itself doesn't increase standard of living. The Vanderbilts still shit in pots in their expensive mansions in the 1860s. Probably had no toilet paper either. And they were some of the wealthiest Americans. Had no running water, electricity, or internet.
Yet even poor people in the USA have all that (mostly).
Arguably technology advances a civilization. Whether or not technological advances happen and/or are distributed to the populace doesn't matter through what economic model as long as it happens.
Which is why China is a success story and Somalia is not.
>>1368087
Historians and economists don't think neoliberalism as defined by the original manifesto is a failure at all.
>>1365176
Japan's industrialization was better.
They went from medieval economics to industrial power in less than a century. Russia was at least nominally modern when Stalin took over.
>>1365901
>>1368095
Zizek isn't an economist and hasn't performed empirical studies or peer review and shouldn't be taken as a source on this topic.
>>1367315
Saved.
>>1368082
>It doesn't think that neoliberalism is bad.
Nigger are you fucking serious?
>The benefits in terms of increased growth seem fairly difficult to establish when looking at a broad group of countries.
>The costs in terms of increased inequality are prominent. Such costs epitomize the trade-off between the growth and equity effects of some aspects of the neoliberal agenda.
>Increased inequality in turn hurts the level and sustainability of growth. Even if growth is the sole or main purpose of the neoliberal agenda, advocates of that agenda still need to pay attention to the distributional effects.
>On capital account liberalization, the IMF’s view has also changed—from one that considered capital controls as almost always counterproductive to greater acceptance of controls to deal with the volatility of capital flows. The IMF also recognizes that full capital flow liberalization is not always an appropriate end-goal, and that further liberalization is more beneficial and less risky if countries have reached certain thresholds of financial and institutional development.
That's right from the fucking IMF itself
http://www.imf.org/external/pubs/ft/fandd/2016/06/ostry.htm
I mean fucking seriously, did you think that I wasn't going to call your bluff? I swear you Neoliberals get more desperate and ridiculous every day.
>>1368091
I've seen the argument that wages should be based on productivity but to me that's both quasi-LTV trash and rewards the wrong thing. By no means are workers actually being more physically productive. They are working less hours and working conditions have improved.
The thing that is driving it is technology. I don't think we could ever keep up wages with technological growth and to me that's an unsustainable model.
>>1368096
Thanks, I know this though. The meaning of my post is that ideas that have already died keep resurfacing because people like that anon aren't keeping up.
I can't be bothered arguing about the specifics myself here because another anon is already doing a good job. The thing that most annoys me about these threads is that people who don't understand anything about economics just spout whatever ideological crap they think is plausible, like the idiot spouting natural rate of interest would have avoided crisis.
>>1368082
Income inequality shifts the median income down and is why crisis occurs, that is the moment private debt can't be serviced on the aggregate is reached faster.
Of course there are about 10 assumptions between your understanding and the facts so don't reply.
>>1368104
I've read that paper tons of times because its spammed all over the place lately.
Neoliberalism is defined originally as a fact based market economy that puts freedom of people and freedom of markets based on empirical evidence ahead of all.
This doesn't mean "wow never regulate". It means you fact check and make sure of what regulations are necessary. That paper even says Chile is a model of the world. Chile is a freer market than the US.
It in no ways says its bad.
You also are decontextualizing things. The second > in the block says that neoliberalism has to trade growth or inequality. Its a balance. Which is something we all agree on I think. But it also implies that higher growth and inequality are somewhat inversely proportional.
It also basically says that cash flows are more fine if you are trading with other developed countries. Which is fine when the world is industrializing.
You posted an article that says neoliberalism isn't perfect. Its not. Noone has ever said it is.
>>1368110
If, say, productivity doubles and hours worked remain about the same, production doubles. Moving wages in line with productivity (in this example, doubling them) would not be unsustainable, it would just keep the worker's share of income constant. A deviation in the variation of productivity in relation to the variation of wages means the workers get to consume a fewer share of social production, aka an increase in inequality. In fact, wages moving under productivity mathematically means that the share of workers tends to zero, even if in absolute terms they are not worse off.
>>1368135
The people who make the machines and run the markets do much more for that productivity than the average worker. There are no charts that show the productivity of each income group.
>>1368141
>The people who make the machines and run the markets do much more for that productivity than the average worker
The people who "make the machines" are workers. I don't know what "The people who run the markets" means.
>>1368082
>If measures to decrease income inequality take hold, pretty much all economists think that it will lower the growth of median income.
You realise that if you increase median income with a once off discontinuity like transfer payments then the rate of growth decreases because the denominator has just increased?
If the claim is rather that the increase in median income due to government transfers and compensations is lower because the portion that is due to wages grows slower then I'm going to need a source on this.
>>1368146
I meant engineers, designers, scientists, and bosses who ask for the machines to be made for make the machines and investors for who run the markets.
Those are completely separated from the average worker.
>>1368110
Optimally, it would be energy as a currency as that is what requires to do work, but then I think we'd just get a surplus of energy as everyone builds solar panels on their roof to make money.
Maybe an energy surplus world wouldn't be a bad thing though.
>>1368154
>I meant engineers, designers, scientists, and managers
Believe it or not all of these are workers if they aren't owners.
So everyone except the boss is a worker. Implying your CEO or board of executives and higher managers have degrees in engineering or chemical biology. KEK
>>1368150
This is long term. Forgive me if there's a bit of praxing it out for this moment.
There are tons of studies done by mainstream that show that many measures taken to redistribute wealth have longer term reductions in growth.
There are also studies done showing strong correlation between growth and median income.
In the long term, this would imply that very strong measures to increase income inequality (Basic income, strong negative income and sales tax, etc.) has at least a chance of lowering the median income.
I'm aware of no studies on the long term effects of these things because they are relatively modern concepts.
>>1368161
Energy as a currency to me cannot be easily regulated for business cycles.
>>1368154
Those are workers, anon. When people analyze the evolution of worker and capital shares of income, those people are included among the workers (obviously).
Except investors, but i don't know how productivity applies to them. They have a marginal influence in management.
>>1368166
>>1368170
I'm not implying that. I'm implying the company relegating funds is part of the group that makes it happen by funding.
And I was talking about the median and low class worker. Who make much less than these people do. Propping up the poor for work they didn't do to benefit the economy would be unsustainable.
Not to say the poor don't contribute. They do. Just not as much as the productivity graphs show.
Also investors are one of the chief components of growth. Companies make so much money because of not just wall street, but because you have the government or private people investing in them.
>>1368167
>There are tons of studies done by mainstream that show that many measures taken to redistribute wealth have longer term reductions in growth.
I would just like to see one so I can determine what the meaning of the finding is.
This is because it seems to directly contradict studies as follows that take into account trends across all the countries that matter.
Here is just one summary by the OECD of the research it conducts: https://www.oecd.org/social/Focus-Inequality-and-Growth-2014.pdf
>New OECD research shows that when income inequality rises,
economic growth falls.
>>1368167
>There are tons of studies done by mainstream that show that many measures taken to redistribute wealth have longer term reductions in growth.
It is really easy to achieve whatever conclusion you want using econometric studies, and major economic papers only accept studies in line with the neoclassical dogma.
The "asian miracle" started with massive agrarian reforms in favor of the people, greatly reducing inequality, just before the biggest economic growth in history.
>>1365362
“Milton Friedman's misfortune is that his economic policies have been tried.” - John K. Galbraith
>>1368184
This is not true. Neoclassical economics is mostly in the way out. Going to a school that mostly is neoclassical I find it cool because I see the disparity of what I read in the AER and what I get taught in class sometimes.
>>1368193
>Neoclassical economics is mostly in the way out
Since when?
>I see the disparity of what I read in the AER and what I get taught in class sometimes
Examples?
>>1368189
If this thread is still up later please share something. ^_^
>>1368131
Not that anon. Neoliberalism is bad because it's an ideology of domination when applied to countries that are developing.
Pay close attention now. This necessarily means that it's good for nations that are developed.
So when you take a defensive stance saying neoliberalism has problems and isn't perfect 'but no-one ever said that' you've already capitulated to the rebuffing of neoliberalism and are lying about what the consensus always was.
>>1366908
>Ask your economics professor.
>Is god real?
>Ask a theologian.
Expertise means nothing if the topic is political. Economics is not a positive science.
>>1368197
I'd. It seems much more new keynesian.
One of the biggest things I noticed is that at my school we casually disregard lots of things that the new keynesians seem to care a lot about. I've read many articles about crises and how they are worse in flexible economies. And I don't think my school disputes that, but we're always taught that this means that prices drop, people go to work, and this makes supply go up and it mostly irons out.
I see a lot of talk about how crises create new demand and therefore new supply can be made. This can keep the money supply above ground even after people have gone underwater. This smoothes things out and lets people operate more effeciently knowing that the dips aren't as bad.
>>1368224
Well. If China fails and collapses we can say that State Capitalism doesn't work.
If China instead overtakes the United States and becomes the world leading economy and basically dictate to us policy, then we can say it works.
>>1368184
the Millennium Development Goals, embracing many of the Kerala Model's features omitted the land reform that the Kerala Model implemented.
>>1368086
>Manufacturing that is outside Germany, but inside the EU barely exists.
Eh, not really. Poland's economic growth isn't exactly based on the tourist sector. It's largely manufacturing.
>>1368231
Ah, well, i've always considered new keynesians a subset of neoclassicals. Stickiness is not a major disagreement.
>>1366874
Singapore isn't collapsing as one of the most unequal countries in the world. The greatest period of growth in the history of America was during a deflation period. Estonia was the forst European country to escape the recession,just with pure austerity.
>>1368130
>and is why crisis occurs
This is bullshit.
>>1368234
>Every economic ideology is one of domination.
No it's not, jesus christ stop reaching with irrelevant points.
Every time the mainstream loses an argument it just shifts the goal posts.
>>1366330
Nah, he means that millions of tons of raw materials were shipped by the lend lease act. If the the soviet union's victory is based off industry it must be said that they would have been much less of a threat if the lend lease act didn't exist. Makes you wonder why america even sent goods to the USSR.
It really doesn't matter what kind of economic system you have on the macro level as long as people have enough purchasing power to buy goods; preferably plenty of goods and expensive goods.
The consumption of goods is the only thing that matters in an economy, because it is the consumer that creates jobs.
>>1368477
>The consumption of goods is the only thing that matters in an economy
>>1368481
Are you going to say anything substantive, or are you only going to meme?
