Larry Summers criticizes stimulus plan and is seeing worst Marcoeconomic policies in 40 years

[GP270watch]

 When is the last time we had a global pandemic and land war in Europe, I think people often lose sight of the bigger picture.

[H. Ross Peron]

     Wow, Summers was really vindicated here. Atlas once again proving that it is basically incapable of serious analysis and just assumes a priori that what the Democrats are doing is the correct course of action.

Even if the stimulus was the main cause of inflation (which is unlikely as opposed to being a factor), it would not be the worst macroeconomic policy in 40 years. 2009 undershooting on the stimulus and spending cuts thereafter were worse in terms of economic impact on people.

[Badger]

No no, you see, the best thing to do during rampant inflation is to spend trillions of dollars really suddenly.

It's thought the best thing to do for inflation was to blow a massive hole in the budget by giving tax cuts to huge companies for no reason.

Doing so increased aggregate supply which reduced inflation which is what happened the last time we were in this mess if that’s what you are referencing.

If you are referencing the 2017 tax cut then lol at blaming that for the current crises

Economy slowing down with poor job growth? The solution is obviously for tax cuts aimed at my well-to-do family!

Inflation heating up and prices rising? The solution is obvious to cut taxes for my well-to-do family!

Republicans are so clever. Is there nothing an upper income tax cut won't solve?

[Pres Mike]

Yellen was just wrong about concrete events in the material world! She can claim that she was right about "economic fundamentals" if she wants, of course, because they are high-level abstractions and easily abused for the sake of bullsh!ting non-technical audiences.

But Yellen isn't even pretending to advance a technical argument in this article. She simply admits that the administration has been wrong in its insistence that a concrete problem, one that Americans have been experiencing for months, is not a severe problem.

That is closer to where the general interest lies, i.e. with the intuitions that high-profile economists have and choose to convey based on both technical expertise and proximity to power. Yes, they are technical experts, but so are thousands of less prominent economists.

A Larry Summers or a Janet Yellen attracts attention not because they are experts but because they are economist-politicians. We pay attention because they hold or have held prominent places in court, and because we imagine that what they say in public corresponds with what they whisper in the ears of the powerful.

Well, if things had continued to go as smoothly as they were going in 2021 then the concrete problem would, in fact, have ended up not being a severe problem.

The issue at hand is that unforeseeable events in the real world -- namely, China going insane and Russia starting a war with Europe -- have exacerbated the problem and prolonged it to the point where it now has become a severe problem, not just because of its impact, but because it's going to be much more difficult to unravel.

If we returned to the pre-COVID economy tomorrow then most of the inflation would disappear rather quickly.  But we have all these supply chain issues and labor shortages driving up prices, plus the oil crisis caused by the European embargo on Russian oil imports, plus a looming potential wheat crisis, again caused by the war.

I would also add corporate greed taking advantage of supply chain issues.

Look at cars. Some dealers have no markups. Some put 5k "market adjustment" fees. That is just taking advantage of people. I had a car salesmen straight out tell me that they put these extra fees because "they can".

Look at the price of wood at Home Depot. The issues with the timber industry have been (mostly) solved yet prices are at record highs. Because Home Depot can keep prices high. Where else is the average American going to buy lumber?

I would also add good ole American stupidity. Why does everyone want to buy a house now?

[OSR stands with Israel]

Maybe people like Larry Summers should have been listened to more in 2021 and we would not be facing the cost of living crises we are now. The ARP had disastrous effects and permanently raised prices in the long run

[○∙◄☻¥tπ[╪AV┼cVê└]

Maybe people like Larry Summers should have been listened to more in 2021 and we would not be facing the cost of living crises we are now. The ARP had disastrous effects and permanently raised prices in the long run

Summers said we need to boost military spending, which obviously would boost inflation.

[Amenhotep Bakari-Sellers]

No it's not Stimulus checks it's called Student Loan forgiveness they didn't give us blanket discharges but we are still in 20 yr forgiveness I haven't received a blanket discharge and still not paying back my student loans it's called 25 yr forgiveness.

Stop blaming stimulus checks for reason for INFLATION

[Antonio the Sixth]

The idea that the average American would have been better off with no stimulus is at best dubious, at worst the quintessential example of confusing abstract economic models for reality. Even if you want to blame it for inflation (and I'd need to see empirical evidence of that, not just theories), given that its benefits were concentrated on the working class it's quite likely that the bottom quartiles were made better off overall, even if the top ones were made worse off.

[Obama24]

The idea that the average American would have been better off with no stimulus is at best dubious, at worst the quintessential example of confusing abstract economic models for reality. Even if you want to blame it for inflation (and I'd need to see empirical evidence of that, not just theories), given that its benefits were concentrated on the working class it's quite likely that the bottom quartiles were made better off overall, even if the top ones were made worse off.

Think without the stimulus you'd have seen a lot more suicides, being blunt. For a lot of people at the bottom, as you note, it was their ONLY lifeline. I was laid off during the pandemic and the stimulus / UI was the only thing that kept me from starving. I know many others who were in the same position.

[Agafin]

Guys that’s been wrong about everything is wrong some more

Is this the most recommended post in atlas history? That'd be ironic since it was ultimately wrong.

[MasterJedi]

Maybe people like Larry Summers should have been listened to more in 2021 and we would not be facing the cost of living crises we are now. The ARP had disastrous effects and permanently raised prices in the long run

lol

[Open Source Intelligence]

The world is completely changing...and no one outside of the Beltway and economic elites are paying any attention to it.

I read Michael Every a good bit, he's a global strategist for Rabobank based out of Singapore. We're all becoming protectionist mercantilists now, and this all has martial (national security, war) applications. This is from today's Global Daily update.

In 2019, [former] Senator Joe Biden tweeted: “Trump doesn’t get the basics. He thinks tariffs are being paid by China. Any freshman econ student could tell you that the American people are paying his tariffs. The cashiers at Target see what’s going on – they know more about economics than Trump.”

Yesterday, President Biden removed no legacy Trump tariffs and added 102.5% on EVs, 50% on solar cells, syringes, and needles; 25% on lithium-ion batteries for EVs and battery parts; 25% on certain critical minerals, steel and aluminium products, respirators, face masks, and (deep) ship-to-ship cranes; from 2025, 50% on semiconductors; and from 2026, 25% on other lithium-ion
batteries, natural graphite, permanent magnets, and rubber medical/surgical gloves. China has stated that it “opposes the unilateral imposition of tariffs which violate WTO rules, and will take all necessary actions to protect its legitimate rights.” In other words, we can expect retaliation in kind.

Our confidence in politicians doing what they say is not as high as it was. However, politicians’
confidence in free trade is not as high as it was – and rightly so.

Economically, there is much less difference between Biden and Trump than either Democrats or Republicans care to admit. Biden prefers to focus on the American worker, Trump calls it America First - the end result is the same. Biden has signalled pulling out of the WTO, that would be a Trump campaign idea circa 2016 everyone would have lambasted him for that he's not a serious candidate.

What Trump and Biden are pushing is to increase U.S. jobs by 5% while the prices consumers pay increase 10% to pull numbers out of my backside.

The goal is to harm China as even Brad Setser says China's Electric Vehicle production proves mercantilism works. Europe are either going to have to copy us or will completely die economically.

[dead0man]

ran into this tweet from Biden in 2019https://twitter.com/JoeBiden/status/1138506137697959939WTF happened bro?  Did you remember who pays your bills and decide to forget basic economics and screw over everyone to the benefit of a fraction of us?

[Open Source Intelligence]

Maybe people like Larry Summers should have been listened to more in 2021 and we would not be facing the cost of living crises we are now. The ARP had disastrous effects and permanently raised prices in the long run

Summers said we need to boost military spending, which obviously would boost inflation.

Military spending is going up anyway to deal with global issues. And aid to Ukraine, Israel, Taiwan should definitely be considered military spending, its just not spending for our military.

[dead0man]

Maybe people like Larry Summers should have been listened to more in 2021 and we would not be facing the cost of living crises we are now. The ARP had disastrous effects and permanently raised prices in the long run

Summers said we need to boost military spending, which obviously would boost inflation.

Military spending is going up anyway to deal with global issues. And aid to Ukraine, Israel, Taiwan should definitely be considered military spending, its just not spending for our military.

I'd wager that military spending, as a percentage of all govt money spent, is going down, just like it has nearly every year since 1991.

[Open Source Intelligence]

Maybe people like Larry Summers should have been listened to more in 2021 and we would not be facing the cost of living crises we are now. The ARP had disastrous effects and permanently raised prices in the long run

Summers said we need to boost military spending, which obviously would boost inflation.

Military spending is going up anyway to deal with global issues. And aid to Ukraine, Israel, Taiwan should definitely be considered military spending, its just not spending for our military.

I'd wager that military spending, as a percentage of all govt money spent, is going down, just like it has nearly every year since 1991.

Well we're now spending more for interest on the debt than we are defense.

[Vice President Christian Man]

Guys that’s been wrong about everything is wrong some more

Is this the most recommended post in atlas history? That'd be ironic since it was ultimately wrong.

Scotts “Im still calling it Atlas” was with over 200 recs.

[Amenhotep Bakari-Sellers]

As I said in a previous thread that if they don't give us stimulus checks since Spk Johnson hasn't passed one check and it's likely Jeffries will they will give it to oil Corporation in the form of tax cuts. What does Trump want to do not give us a stimulus check give more tax cuts

[OSR stands with Israel]

Guys that’s been wrong about everything is wrong some more

Is this the most recommended post in atlas history? That'd be ironic since it was ultimately wrong.

The fact it has even more recs now than it did before I bumped this thread is lol worthy. He was proven completely right here but it’s easier to yell how evil neoliberalism is than realize that passing over a trillion dollar stimulus at a time when the economy was growing very fast is extremely inflationary.

The situation in March of 2021 was not comparable to Feb 2009 at all yet everyone treated it as it was and did a much bigger stimulus than Feb 2009 which was ridiculous.

[MasterJedi]

Guys that’s been wrong about everything is wrong some more

Is this the most recommended post in atlas history? That'd be ironic since it was ultimately wrong.

The fact it has even more recs now than it did before I bumped this thread is lol worthy. He was proven completely right here but it’s easier to yell how evil neoliberalism is than realize that passing over a trillion dollar stimulus at a time when the economy was growing very fast is extremely inflationary.

The situation in March of 2021 was not comparable to Feb 2009 at all yet everyone treated it as it was and did a much bigger stimulus than Feb 2009 which was ridiculous.

Ok beep boop

[Agafin]

Guys that’s been wrong about everything is wrong some more

Is this the most recommended post in atlas history? That'd be ironic since it was ultimately wrong.

Scotts “Im still calling it Atlas” was with over 200 recs.

Wow that's a lot. Can you link it?

[GP270watch]

Guys that’s been wrong about everything is wrong some more

Is this the most recommended post in atlas history? That'd be ironic since it was ultimately wrong.

The fact it has even more recs now than it did before I bumped this thread is lol worthy. He was proven completely right here but it’s easier to yell how evil neoliberalism is than realize that passing over a trillion dollar stimulus at a time when the economy was growing very fast is extremely inflationary.

The situation in March of 2021 was not comparable to Feb 2009 at all yet everyone treated it as it was and did a much bigger stimulus than Feb 2009 which was ridiculous.

 He wasn't proven right at all and was predicting much worse inflation. What we got for having a global pandemic and Russian invasion of Ukraine disrupting energy to most of Europe is remarkably manageable, more so than anybody predicated, thanks in part to the policies of Joe Biden.

 The remedies Larry Summers was touting were also wrong:

 Larry Summers Was Wrong About Inflation

Yellen criticizes Summers on inflation: He’s ‘been wrong in the past’

“He’s a person who’s been wrong in the past,” Yellen said of Summers during a House Ways and Means Committee hearing. “He said that it would absolutely take a recession to bring inflation down, and that turned out to be a serious misjudgment.”

[dead0man]

Ok beep boop

this is a redav insult, no content no originality

[○∙◄☻¥tπ[╪AV┼cVê└]

Maybe people like Larry Summers should have been listened to more in 2021 and we would not be facing the cost of living crises we are now. The ARP had disastrous effects and permanently raised prices in the long run

Summers said we need to boost military spending, which obviously would boost inflation.

Military spending is going up anyway to deal with global issues. And aid to Ukraine, Israel, Taiwan should definitely be considered military spending, its just not spending for our military.

I'd wager that military spending, as a percentage of all govt money spent, is going down, just like it has nearly every year since 1991.

Well we're now spending more for interest on the debt than we are defense.

A lot of that is because of military spending.

[Open Source Intelligence]

Guys that’s been wrong about everything is wrong some more

Is this the most recommended post in atlas history? That'd be ironic since it was ultimately wrong.

The fact it has even more recs now than it did before I bumped this thread is lol worthy. He was proven completely right here but it’s easier to yell how evil neoliberalism is than realize that passing over a trillion dollar stimulus at a time when the economy was growing very fast is extremely inflationary.

The situation in March of 2021 was not comparable to Feb 2009 at all yet everyone treated it as it was and did a much bigger stimulus than Feb 2009 which was ridiculous.

 He wasn't proven right at all and was predicting much worse inflation. What we got for having a global pandemic and Russian invasion of Ukraine disrupting energy to most of Europe is remarkably manageable, more so than anybody predicated, thanks in part to the policies of Joe Biden.

 The remedies Larry Summers was touting were also wrong:

 Larry Summers Was Wrong About Inflation

Yellen criticizes Summers on inflation: He’s ‘been wrong in the past’

“He’s a person who’s been wrong in the past,” Yellen said of Summers during a House Ways and Means Committee hearing. “He said that it would absolutely take a recession to bring inflation down, and that turned out to be a serious misjudgment.”

Yellen has hardly had a good performance her term as Secretary of the Treasury. Suggest you find a better source to criticize Summers with.