U.S. Politics: Russian Around

[drawkcabi]

Please continue.

[LongRider]

Clever thread title, I like it.

[Mr. Chatywin et al.]

After listening to a montage of Congressional Republicans talk about healthcare, I'm left wondering if the party of Jesus hates the poor......

 

 

........oh wait, the last 30+ years tell me that of course they do.

[OldGimletEye]

And now we’re at the part where conservative sorts of people say, “Golly, Trump isn’t going to be able to close the trade deficit much” and the reality based community says, “well no crap”.

https://www.washingtonpost.com/news/wonk/wp/2017/03/07/trump-rails-against-the-trade-deficit-but-economists-say-theres-no-easy-way-for-him-to-make-it-go-away/

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The Trump administration has railed against the trade deficit as evidence that America no longer wins. President Trump and his trade advisers have described the metric, the sum of what the U.S. exports minus what it imports, as the result of failed trade deals and promised to shrink it.

 

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The U.S. economy is performing better than many other economies around the world, said Eswar Prasad, a senior professor of trade policy at Cornell University. That means that U.S. consumers have the ability to buy goods from abroad but consumers abroad are unlikely to buy much from the United States, a dynamic that increases the trade deficit.

Once, again, conservative sorts of people were at the accounting identity:

EX – IM = S – I

First to be a net exporter, the US has to save more than it consumes. And then you actually have to have the worldwide demand for those exports, if were going to maintain full employment, which there isn’t right now (demand for large exports). Plus there, you know, us being a reserve currency and the demand for US financial assets play a part too here.

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In addition, the prospect of the Federal Reserve hiking interest rates, perhaps as soon as mid-March, is likely to attract more global investment to the United States, Prasad said. That would drive up the value of the dollar, which would make imports seem relatively cheap for U.S. consumers.

Conservative sorts of people, meet the interest parity condition (and by the way, I'm of the opinion the FED shouldn't raise the rates in March, though conservative sorts of people disagree).

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“Left to itself, the trade deficit would probably rise, simply because the U.S. economy is doing a lot better than most of its trading partners,” Prasad said.

Conservative sorts of people, if we increase national savings right now, there isn’t the external demand to drain it away, keeping us at full employment.

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Trump's own policies, such as a tax cut for individuals and corporations, could also encourage the trade deficit to rise, said Stan Veuger, a resident scholar at the American Enterprise Institute. Such policies would probably boost growth and attract foreign investment into the United States — factors that would push up the value of the dollar and boost the trade deficit.

Conservative sorts of people, once again meet the interest parity condition. If Trump’s awesomey awesome bestest ever, this time it’s gonnna work, just wait you’ll see, supply side policies raises the return of capital, that will likely create financial flows into the United States. Plus, too, you know bigly tax cuts for the rich will raise the interest rate.

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In fact, economists say that one of the only ways the Trump administration could reliably reduce the trade deficit is by derailing trade itself. If the Trump administration enacts tariffs and other tough barriers to trade, that could potentially spark a trade war and cause imports and exports to fall. But in the process, the administration could also trigger a slowdown in the economy.

Given slack demand conditions, conservative sorts of people, Trump could cancel our trade agreements and that might give a quick boost to the economy. But, in the long, it’s not good

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At a conference Monday morning in Washington, Peter Navarro, the director of Trump’s National Trade Council, reiterated the administration’s focus on the trade deficit. The Trump administration policy is one of “free and fair and truly reciprocal trade that begins and ends with the belief that bilateral trade deficits do indeed matter,” he said.

“Trade deficits not only matter when it comes to jobs and growth and national security, they matter a great deal,” Navarro said.

I see three broad sorts of problems that can occur with free trade:

1. Wealth redistribution issues.

2. Labor market adjustment problems.

3. When foreign savings is high and there isn’t enough private high yield investment projects in the domestic economy to sustain a high enough rate of interest, which makes the FED’s job of sustaining full employment more difficult because your closer to the ZLB.

All of these can be handled, if we choose to. But, you know, Trump is choosing to give tax cuts to the rich.

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So imports reduce a country’s GDP in an accounting sense, but that doesn’t mean they necessarily cause GDP to be smaller, as economists from the University of Wisconsin at Madison and Tufts University have argued.

Once, again,

Y = C + I + G + EX – IM

is an accounting condition, conservative sorts of people, not a behavioral relationship.

[OldGimletEye]

Just now, The Great Unwashed said:

Paul Ryan: Lowering costs is more important than millions of people losing insurance.

Yes, the conservative "plan" to lowering cost is by just making sure many people don't have access to health care at all.

And then they say to themselves,"we're such geniuses and that's why were conservatives and Republicans!!!!".

How about expanding coverage and lowering cost?  Now that would be impressive, and it's doable.

And Chaffetz gets my vote, for "Conservative Idiot of The Week" though, it was a tough choice cause there was so much to choose from.

[all swedes are racist]

Suggested thread edit: "Freedoms just another word for can't afford to choose"

[OldGimletEye]

Just now, supernintendo chalmers said:

Suggested thread edit: "Freedoms just another word for can't afford to choose"

Conservatives never consider the possibility that having a little less dependence on your libertarian high feudal overlords might be freedom enhancing for many folks.

[Mlle. Zabzie]

48 minutes ago, Tywin et al. said:

After listening to a montage of Congressional Republicans talk about healthcare, I'm left wondering if the party of Jesus hates the poor......

 

 

........oh wait, the last 30+ years tell me that of course they do.

Well, you know, it's really more the party of Calvin.  And that makes more sense.

OGE - I think it may well be rational to raise rates now.  At least from where I'm sitting, credit markets are starting to get a bit frothy on the borrower side and it might be a good thing to tamp down some of that exuberance.  Also, though an inflationary period might make it easier for existing borrowers to pay off debt, it simply creates a different set of winners and losers.  The economy feels a bit bubbly right now, and I assume that we are due for a market correction of some kind in the next 18 months.  

[OldGimletEye]

Just now, Mlle. Zabzie said:

OGE - I think it may well be rational to raise rates now.  At least from where I'm sitting, credit markets are starting to get a bit frothy on the borrower side and it might be a good thing to tamp down some of that exuberance.  Also, though an inflationary period might make it easier for existing borrowers to pay off debt, it simply creates a different set of winners and losers.  The economy feels a bit bubbly right now, and I assume that we are due for a market correction of some kind in the next 18 months.  

Okay, I take it your not a fan of EMH. Well,as it so happens, neither am I.

But anyway, the people that win from tight labor markets are working people. I don't really give a hoot about the creditor class. The FED has been under its inflation target for a while. There is no reason it shouldn't run above it's 2% inflation target for a while. I'd say there is still bit of an output gap. And it would seem wage gains are bit slow, so I'm not too sure about the economy being bubbly.

And there are better ways to handle financial instability problems than raising the rates, by doing stuff, like not destroying Dodd-Frank.

[Mlle. Zabzie]

3 minutes ago, OldGimletEye said:

Okay, I take it your not a fan of EMH. Well,as it so happens, neither am I.

But anyway, the people that win from tight labor markets are working people. I don't really give a hoot about the creditor class. The FED has been under its inflation target for a while. There is no reason it shouldn't run above it's 2% inflation target for a while. I'd say there is still bit of an output gap. And it would seem wage gains are bit slow, so I'm not too sure about the economy being bubbly.

And there are better ways to handle financial instability problems than raising the rates, by doing stuff, like not destroying Dodd-Frank.

Yes, but we deal with what tools are available, and sadly, the Fed is the tool that is available currently.  And perhaps I mispoke.  Markets are bubbly.  There will be a market correction in the next 18 months (I've already seen the articles talking about why THIS bull market is more sustainable than other bull markets - sure sign).  Though markets do not reflect the over all economy, there will be macro impacts, and I fear that current executive policies will only exacerbate those impacts. I'd rather have an gentler rate driven correction now.   

[Ormond]

38 minutes ago, Mlle. Zabzie said:

Well, you know, it's really more the party of Calvin.  And that makes more sense.

 

And that itself may be a misunderstanding of John Calvin. The "Calvinism" that is often thought to underlie laissez faire capitalism is not what Calvin himself would have supported, at least according to the following:

http://spindleworks.com/library/vanpopta/calvin.htm

A quote from the above:

Quote

Calvin believed that the blessings of God must be applied to the common good of the church. In his writings he often points to the role that the rich had in society. In his commentaries on II Corinthians he writes

Thus the Lord recommends to us a proportion of this nature, that we may, in so far as every one's resources admit, afford help to the indigent, that there may not be some in affluence, and others in indigence. (295)

Here is one of Calvin's profound insights on the role of the Christian man. When modern critics of Calvin declare him to be the father of laissez-faire capitalism (Visser't Hooft 8) they fail to understand the import of (or have not read Calvin on) this issue. The Marxists may claim as their slogan, "to each according to his needs, from each according to his capacities," but Calvin understood that this was a biblical teaching. Visser't Hooft lays the charge that it is in the perversion of later Calvinism that Calvin's teachings of social reform were abandoned and that the Calvinist churches did not for long maintain the courage and vitality necessary for the accomplishment of the prophetic mission entrusted to them - a mission which, for Calvin, had been an essential duty of the church.

 

[Mlle. Zabzie]

1 minute ago, Ormond said:

And that itself may be a misunderstanding of John Calvin. The "Calvinism" that is often thought to underlie laissez faire capitalism is not what Calvin himself would have supported, at least according to the following:

http://spindleworks.com/library/vanpopta/calvin.htm

A quote from the above:

 

Ormond - was more thinking of the interpretation by less brilliant men of his theory of the elect and the effect it had on views on charity (and acceptance thereof).

[Maithanet]

48 minutes ago, Mlle. Zabzie said:

Well, you know, it's really more the party of Calvin.  And that makes more sense.

I just assumed you meant that Republicans are playing Calvinball at this point.

[James Arryn]

21 minutes ago, Ormond said:

And that itself may be a misunderstanding of John Calvin. The "Calvinism" that is often thought to underlie laissez faire capitalism is not what Calvin himself would have supported, at least according to the following:

http://spindleworks.com/library/vanpopta/calvin.htm

A quote from the above:

 

I'm uncertain if Calvin is referring to redistribution or charity, though. If the latter, you'd be hard pressed to find any group outside of 'Objectivists' who didn't make a lot of noise supporting the idea of charity. In fact l-f capitalists almost universally cite voluntary benevolence as the proper means to redress social inequity. 

[Ormond]

2 minutes ago, Mlle. Zabzie said:

Ormond - was more thinking of the interpretation by less brilliant men of his theory of the elect and the effect it had on views on charity (and acceptance thereof).

If there's one thing the present political climate shows, it's that in addition to us always having the poor with us, we will also always have those who twist the ideas of others, whether they be Jesus, Calvin, Buddha, or Marx, to justify blaming the poor for their own condition and thereby refusing to help them.

[Cas Stark]

39 minutes ago, OldGimletEye said:

Okay, I take it your not a fan of EMH. Well,as it so happens, neither am I.

But anyway, the people that win from tight labor markets are working people. I don't really give a hoot about the creditor class. The FED has been under its inflation target for a while. There is no reason it shouldn't run above it's 2% inflation target for a while. I'd say there is still bit of an output gap. And it would seem wage gains are bit slow, so I'm not too sure about the economy being bubbly.

And there are better ways to handle financial instability problems than raising the rates, by doing stuff, like not destroying Dodd-Frank.

True, but the people who lose from inflation are also working people, so it's an awfully small tight rope to walk your monetary policy on and more often than not, it blows up in the faces of the bankers.  I think the economy is quite bubbly in some places, and we are due for a correction.  But then I thought the Feds should never have kept the rates this low for this long, because this again, mostly hurts people who are on fixed incomes where making some bit of money from savings would be a huge help.  We're in a tough spot for the long term because none of the underlying problems with our economy and how public companies are valued has been addressed.  

[Martell Spy]

Quote

 

Does Trump remind you of anyone from recent history, or does he seem sui generis as a possible tyrant?

Viktor Yanukovych, the former president of Ukraine who was a client of Russia. Yanukovych’s main idea in power was to turn the Ukrainian state into a money-making machine for the Yanukovych family. I think whatever ideological coloration we think actually applies to Trump, we can be pretty confident that he sees the American state as a mechanism to make sure that people called Trump are rich forever.

 

What the 20th Century Tells Us About Trump

Timothy Snyder on the president’s endgame and how effectively Americans are resisting so far.

http://www.slate.com/articles/news_and_politics/interrogation/2017/03/timothy_snyder_on_what_the_20th_century_tells_us_about_trump_s_endgame.html

[OldGimletEye]

18 minutes ago, Cas Stark said:

True, but the people who lose from inflation are also working people, so it's an awfully small tight rope to walk your monetary policy on and more often than not, it blows up in the faces of the bankers.  I think the economy is quite bubbly in some places, and we are due for a correction.  But then I thought the Feds should never have kept the rates this low for this long, because this again, mostly hurts people who are on fixed incomes where making some bit of money from savings would be a huge help.  We're in a tough spot for the long term because none of the underlying problems with our economy and how public companies are valued has been addressed.  

No working people do not lose from inflation if their wages are increasing and they are employed. And the way the their wages increase is by the FED meeting its inflation target and keeping labor markets tight and eliminating output gaps.

Guess some people never have heard of liquidity traps.

The FED kept rates for too low for too long.

What a flamin bullshit argument. Under this bullshit, more people would have been unemployed and there would be more downward pressure on wage growth.

And it is one of the biggest pieces of trash to come out of Republican Party. Good thing the Republican Party's advice was ignored on this matter.

 If the FED had raised rates earlier, it would have created more unemployment and put downward pressure on wages. With out fiscal support, there was nothing else left to do.

As far as the poor old people on fixed incomes go. You know, it's not like we were running inflation beyond the normal 2% target that those people have expected for a long time. And many of those poor old fixed income people are wealthy bond holders. 

[Martell Spy]

Why Is McConnell Rushing Through a Trumpcare Bill Everybody Hates?

http://nymag.com/daily/intelligencer/2017/03/why-is-mcconnell-rushing-through-a-bill-everybody-hates.html

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From that standpoint, the winning play for the GOP might be to try to repeal and replace Obamacare but fail. If they are seen trying and failing to repeal the law, it might upset the base, but most Republican lawmakers will have their opposition to Obamacare on the record. And if it is to fail, it should fail quickly, so they can move on to cutting taxes.

This may all be wrong. It is never safe to assume rational thought on the part of public actors, especially in the reality-distortion field of Trump’s Washington. Maybe ultra-conservatives think they are using their leverage to push the bill to the right. Or maybe McConnell believes he can whip his caucus into line. Whatever the explanation, the strategy behind the bill is almost as incompetent as the bill itself.

 

 

[Cas Stark]

18 minutes ago, OldGimletEye said:

No working people do not lose from inflation if their wages are increasing and they are employed. And the way the their wages increase is by the FED meeting its inflation target and keeping labor markets tight and eliminating output gaps.

Guess some people never have heard of liquidity traps.

The FED kept rates for too low for too long.

What a flamin bullshit argument. Under this bullshit, more people would have been unemployed and there would be more downward pressure on wage growth.

And it is one of the biggest pieces of trash to come out of Republican Party. Good thing the Republican Party's advice was ignored on this matter.

 If the FED had raised rates earlier, it would have created more unemployment and put downward pressure on wages. With out fiscal support, there was nothing else left to do.

As far as the poor old people on fixed incomes go. You know, it's not like we were running inflation beyond the normal 2% target that those people have expected for a long time. And many of those poor old fixed income people are wealthy bond holders. 

LOL.  Okay, this strikes me as an awfully hostile answer for no reason I can think of, so I will bow out of the economic discussion with the statement that we can agree to disagree on some of this.