Group items tagged

stimulus spending, as prescribed by mainstream economic theory, to create jobs and promote growth."

Obama intends to ignore the path for getting the economy back to full employment that most economists advocate.

interest rates did fall, it is difficult to believe that it would have much impact on either investment or consumption

theory as to how budget cuts could boost growth

lower deficits in the present and/or near future will reduce fears that government spending will be crowding out private economic activity. This would lead to lower interest rates. Lower interest rates will provide a boost to investment and consumption. Also, lower interest rates in the United States will make dollar assets less attractive to investors. This will cause the dollar to decline against other currencies, improving our trade balance.

no part of this story makes sense in the current economic environment. US interest rates are already at ridiculously low levels,

vast amounts of excess capacity.

doesn't matter at the White House any more.

Consumers remain heavily indebted due to the collapse of house prices.

The dollar continues to be a safe haven in uncertain times.

keep the dollar from falling too much against their currencies no matter how low interest rates fall.

unlikely that cutbacks in government spending will do much to lower the dollar and reduce the trade deficit.

Obama is apparently not listening to economists anymore, so he wouldn't care, in any case.

politicians who think that biology has no place in teaching the origins of species, we now have politicians who think that economics has no place in designing economic policy.

tens of millions of lives stand to be ruined.

Keynes's basic insights have been supported by a vast amount of economic research over the last seven decades. And we have solid evidence showing (pdf) that the limited stimulus pushed through by Obama in 2009 worked pretty much as predicted in generating growth and jobs.

policy will be determined by people with no knowledge of economics whatsoever.

evidence,