Presidential election, 2016

[Warren Dew]

(11-14-2016, 12:34 AM)pbrower2a Wrote:

(11-14-2016, 12:14 AM)Galen Wrote:

(11-13-2016, 11:45 PM)Warren Dew Wrote:

But even if you don't believe in keynesian deficits, massive government spending on infrastructure is not the way to go.

This is pretty much what happened in the Great Depression.  Obozo did much the same thing that Hoover and FDR did and got the same results.  Not surprising when you think about it and this is perfectly in line with Hayek's business cycle theory.  If Trump is smart he will do what Harding did and I expect that he will get similar results which were a short nasty recession followed by real growth in the economy.

Let people keep and spend their money and the aggregate demand problem, along with some others, will fix themselves.

There's a big problem with the Harding-Coolidge 'miracle' of maintaining Gilded-Age norms of politics and economics. It was the Hoover crash.

The Hoover crash was a result of Hoover's permitting bank failures actually to destroy money.  I think even Hayek would agree that actively and aggressively contracting the money supply is not a good course of action.  Possibly he would have supported it had it been part of a strategy to eliminate fractional reserve banking on a permanent basis, but that was neither what Hoover was doing nor trying to do.