This is continued from part 1.
We are in a recession. This is a more serious recession in many ways than the last two. However it is far from the proportions of the Great Depression, and the constant comparisons are beginning to wear on me.
This fall I gave a couple of public talks on the economic situation. This was before it was announced that the recession began in December '07. I told my audiences that I did expect that a recession date would be announced soon and that the start date would be between December '07 and July '08. But I was also very quick to point out that although the job losses were already substantial, this was nowhere near the level of severity of the Great Depression. Furthermore, the lessons that we learned from the Great Depression would be key in preventing something like that from ever happening again. Of course, monetary policy is just about tapped out (barring some more drastic maneuvers) having already done what it can to prevent an even more serious failure of the financial market, so this brings us to fiscal policy.
Do we need $800 billion in spending to keep another Great Depression at bay?
Opinions among economists vary widely concerning the stimulus. There are those who support it because they believe it will work (the multiplier is significant) and are not philosophically against larger government. There are those who oppose it because they are philosophically against larger government and therefore the size of the multiplier does not matter (though many of them suspect that the multiplier is small and therefore use that as a supporting argument).
There are those who support tax cuts as stimulus because they support tax cuts all the time. There are those who oppose the tax cuts because they believe consumers will save rather than spend them.
You need a scorecard to sort it all out. We are not speaking with one voice.
This post is already getting too long to get into all of the problems with macro. Besides, Arnold Kling is all over that. While I don't necessarily agree with everything he says, I have enjoyed following his comments.
It will suffice to say that macro folks have some work to do. This is an exciting prospect because it was the inability of macro to answer many of these questions (and the debates that raged as a result) was what captured my attention and made me want to study this crazy stuff.
As for the stimulus package itself, I am a little disappointed. I have my doubts about the size of the multiplier, but am willing to listen to evidence. And while I'm cautious about increasing the size of government, I accept that there is a place for government in the economy. But while watching the cable talk shows last night, the real reason for my skepticism bubbled to the surface.
Everyone is saying how the stimulus is going to "create jobs". After all, job losses are the big story right now. But will this stimulus actually create jobs? Are we in a position to make this work? Before you scoff, consider this:
Good grief! Has it not occurred to people that building roads and bridges is different in 2009 than it was in 1932? Even minor projects need engineering support all the way from inception to completion. How much of the $800 billion will go for that? Do we have enough engineers to support that?
Then there is the fact that at the present time many of the layoffs I'm hearing about are temporary. Unlike the last two recessions where plant closings and outsourcing were major factors. I'm not hearing about plant closings and outsourcing this time. Extensions of unemployment benefits and education tax credits would seem to be a reasonable way to address this. I'm not sure a big construction push is the optimal way forward here.
Infrastructure and energy policy are laudable goals, but are they the way out of this recession? I don't believe so. My disappointment with the stimulus package and much of the debate around it in the media (as opposed to the professional debate among economists, which is of a higher quality) is that so many people think that building roads, bridges, and solar panels is the way to fight the recession. That just doesn't wash.
The tax cuts will be saved rather than spent. A lot of money will go to projects with questionable social value. But yes, taken as a whole, the package will probably cushion the downturn somewhat.
And so once again, I am frustrated by the fact that this stimulus is being identified so closely with job creation. I just don't think that in the final analysis there will be a lot of bang for the buck in terms of job creation, certainly not this year--which is when we really would need it.
Will it keep GDP from falling more than it would otherwise? Sure it will! Even a conservative estimate of the multiplier would concede that. This bill is around 5% of GDP. Even spread out over several years it will be felt. But is it the right spending at the right time? That is less clear.
I don't find anything in the bill that I believe is truly necessary to prevent a Great Depression scenario. But could you argue that this amount of spending (on something, anything) is needed to shore up GDP? You could argue it. You could even argue that because of policy lags we need it now just in case the bottom falls out next year. I'm skeptical but not dismissive. I do believe that a certain amount of fiscal stimulus is a good insurance policy at a time like this, but I also suppose that I wouldn't be happy with any outcome of this political process. So be it.
And that's the problem of fiscal policy in general. Politicians like to believe that they can write legislation and create jobs. It's not as simple as that. There are no free lunches... no matter which party is in the big chair.
We are in a recession. This is a more serious recession in many ways than the last two. However it is far from the proportions of the Great Depression, and the constant comparisons are beginning to wear on me.
This fall I gave a couple of public talks on the economic situation. This was before it was announced that the recession began in December '07. I told my audiences that I did expect that a recession date would be announced soon and that the start date would be between December '07 and July '08. But I was also very quick to point out that although the job losses were already substantial, this was nowhere near the level of severity of the Great Depression. Furthermore, the lessons that we learned from the Great Depression would be key in preventing something like that from ever happening again. Of course, monetary policy is just about tapped out (barring some more drastic maneuvers) having already done what it can to prevent an even more serious failure of the financial market, so this brings us to fiscal policy.
Do we need $800 billion in spending to keep another Great Depression at bay?
Opinions among economists vary widely concerning the stimulus. There are those who support it because they believe it will work (the multiplier is significant) and are not philosophically against larger government. There are those who oppose it because they are philosophically against larger government and therefore the size of the multiplier does not matter (though many of them suspect that the multiplier is small and therefore use that as a supporting argument).
There are those who support tax cuts as stimulus because they support tax cuts all the time. There are those who oppose the tax cuts because they believe consumers will save rather than spend them.
You need a scorecard to sort it all out. We are not speaking with one voice.
This post is already getting too long to get into all of the problems with macro. Besides, Arnold Kling is all over that. While I don't necessarily agree with everything he says, I have enjoyed following his comments.
It will suffice to say that macro folks have some work to do. This is an exciting prospect because it was the inability of macro to answer many of these questions (and the debates that raged as a result) was what captured my attention and made me want to study this crazy stuff.
As for the stimulus package itself, I am a little disappointed. I have my doubts about the size of the multiplier, but am willing to listen to evidence. And while I'm cautious about increasing the size of government, I accept that there is a place for government in the economy. But while watching the cable talk shows last night, the real reason for my skepticism bubbled to the surface.
Everyone is saying how the stimulus is going to "create jobs". After all, job losses are the big story right now. But will this stimulus actually create jobs? Are we in a position to make this work? Before you scoff, consider this:
The Federal Highway Administration has warned the state agency its payroll might be too depleted to handle the monstrous load of projects that a proposed $800 billion federal stimulus package could drop on Illinois' doorstep.
...
The Highway Administration is particularly concerned about professional positions such as engineers.
Good grief! Has it not occurred to people that building roads and bridges is different in 2009 than it was in 1932? Even minor projects need engineering support all the way from inception to completion. How much of the $800 billion will go for that? Do we have enough engineers to support that?
Then there is the fact that at the present time many of the layoffs I'm hearing about are temporary. Unlike the last two recessions where plant closings and outsourcing were major factors. I'm not hearing about plant closings and outsourcing this time. Extensions of unemployment benefits and education tax credits would seem to be a reasonable way to address this. I'm not sure a big construction push is the optimal way forward here.
Infrastructure and energy policy are laudable goals, but are they the way out of this recession? I don't believe so. My disappointment with the stimulus package and much of the debate around it in the media (as opposed to the professional debate among economists, which is of a higher quality) is that so many people think that building roads, bridges, and solar panels is the way to fight the recession. That just doesn't wash.
The tax cuts will be saved rather than spent. A lot of money will go to projects with questionable social value. But yes, taken as a whole, the package will probably cushion the downturn somewhat.
And so once again, I am frustrated by the fact that this stimulus is being identified so closely with job creation. I just don't think that in the final analysis there will be a lot of bang for the buck in terms of job creation, certainly not this year--which is when we really would need it.
Will it keep GDP from falling more than it would otherwise? Sure it will! Even a conservative estimate of the multiplier would concede that. This bill is around 5% of GDP. Even spread out over several years it will be felt. But is it the right spending at the right time? That is less clear.
I don't find anything in the bill that I believe is truly necessary to prevent a Great Depression scenario. But could you argue that this amount of spending (on something, anything) is needed to shore up GDP? You could argue it. You could even argue that because of policy lags we need it now just in case the bottom falls out next year. I'm skeptical but not dismissive. I do believe that a certain amount of fiscal stimulus is a good insurance policy at a time like this, but I also suppose that I wouldn't be happy with any outcome of this political process. So be it.
And that's the problem of fiscal policy in general. Politicians like to believe that they can write legislation and create jobs. It's not as simple as that. There are no free lunches... no matter which party is in the big chair.
"Modern" macro still can't answer these questions which inspired you to "study this stuff like crazy" -- a long time ago Friedrich Hayek explained why:
http://hayekcenter.org/?p=219
The macroeconomists have made a terrible mess of things. What amazes me is the continued lack of humility among all those economists whose "theory" and "evidence" did little help prevent all this from happening.
What are the "modern" macroeconomists going to tell my kids?
Sorry, we screwed up?
Actually I said "study this crazy stuff" rather than "study this stuff like crazy". Not sure which fits better. Both are true.
Anyway, one of the things that has always turned me off about Austrian economics is the disregard, even disdain, for measurement (i.e. econometrics). I happen to think that measurement is important, not because it gets you into the "Science Club," but because I believe (you may disagree) that measurement is the key to formulating and testing our theories about the way the world works.
You may say that the preceding sentence illustrates the way that I have been brainwashed by the Science Club. Fine. Since that is a fundamental impasse between Austrian and non-Austrian economists, I don't think we'll resolve it here.
The disdain for measurement pervades the piece you cite. For example:
"Now this is really what measurement amounts to: a classification of objects according to the manner in which they act on other objects. But to explain human action all that is relevant is how the things appear to human beings, to acting men. This depends on whether men regard two things as the same or different kinds of things, not what they really are, unknown to them. For our purposes the results of measurements (at least so far as these are not performed by the people whose actions we want to explain) are wholly uninteresting."
I am not a Hayek scholar, but I suspect that I have read more of his work than many economists of my generation. There is much in his writings with which I agree. But there is also a lot that just leaves me shaking my head, like the previous paragraph.
You assert that the Hayek piece you cited is an explanation of why modern macro failed. Actually, I think modern macro failed for another reason. One of the tragedies of the last couple of decades of macro is that the different schools of thought (Austrian included) simply stopped talking to each other. Some people took Ricardian equivalence too literally. Others overstate the ability of prices to adjust. But there's not a lot of cross-pollination (and therefore learning). I hope that changes, and I hope the Austrians are part of that. But I'm not holding my breath that much will change.
At present, I am a bit disenchanted with the whole state of affairs. But I think that will cause me to redouble my efforts to bring in a wider array of scholarship into my thinking--Hayek included. But I just can't go all the way.
Let's get a little context.
Hayek _founded_ a macroeconomics research institute, primarily concerned with "measuring" macroeconomic variables. The institute still exists. Hayek began his economic career working to assemble statistical data as a research assistant in New York. This was the 1920s, and the statistical techniques where new and primitive, but the philosophical sophistication was actually of a very high order, compared to today (Oscar Morgenstern worked for Hayek at the Institute, producing important work on "index numbers").
Hayek embraced the "measurement" and valid statistical techniques for getting the best measurements you can get, and he argued for socially constructing the most meaningful macroeconomic" variables one could get.
Hayek was straightforward. "Measurement" and statistics provided us with patterns that raised problems that sound could be explained via sound economics premised on valid "microfoundations" and "microeconomic" processes.
The notion that Hayek disdains "measurement" is a confusion -- and deep failure to understand what it is Hayek is attempting to communicate. Perhaps at age 78, when this essay was written, it's Hayek's fault. But only perhaps. I get a sense that you don't understand the nature of the argument. There is a deep background to it, in Hayek's landmark work _The Sensory Order_, and out of the philosophy of logic and science literature. A simpler version of the argument is found in Hayek's _The Counter-Revolution of Science_. An even simpler version is found in Carl Menger's _The Principles of Economics_. Economic categories of human choice are different from physical categories. This is a pretty basic premise of marginal economics.
But you do get to the core of it. The central fallacy just is this notion of "texting" when it comes to the complex sciences.
Imagine attempting to "test" Newtonian mechanics out in the realm of the 3 body problem (the book _Chaos_ presents a popular version of how long it took physical scientists themselves to give up the notion of precise numerical forecasting as the criterion of science.)
Imagine further if the question of biological adaptation and the origin of species had been tackled by macroeconomists with a Baconian vision of science that told them that measurement was the key to formulating and testing our theories about the way the world works.
There is no way that the Darwinian causal mechanism would ever have been conceived.
Ditto a micreconomically sound causal mechanism explaining the boom and bust cycle.
Enough.
You wrote:
"Anyway, one of the things that has always turned me off about Austrian economics is the disregard, even disdain, for measurement (i.e. econometrics). I happen to think that measurement is important, not because it gets you into the "Science Club," but because I believe (you may disagree) that measurement is the key to formulating and testing our theories about the way the world works.
You may say that the preceding sentence illustrates the way that I have been brainwashed by the Science Club. Fine. Since that is a fundamental impasse between Austrian and non-Austrian economists, I don't think we'll resolve it here."
This I agree with:
"Actually, I think modern macro failed for another reason. One of the tragedies of the last couple of decades of macro is that the different schools of thought (Austrian included) simply stopped talking to each other. Some people took Ricardian equivalence too literally. Others overstate the ability of prices to adjust. But there's not a lot of cross-pollination (and therefore learning). I hope that changes, and I hope the Austrians are part of that. But I'm not holding my breath that much will change.
At present, I am a bit disenchanted with the whole state of affairs. But I think that will cause me to redouble my efforts to bring in a wider array of scholarship into my thinking.."
For many years I ran a "Hayek" email list, with the express purpose of creating a cross-disciplinary, cross "school" conversation.
I brought in people like David Laidler and Steve Keen, and all sorts of people to discuss their work. There were something like 500 academics and journalists and students on the list.
Conversation is a really important thing.
What I'm doing right now it beating people on the head, insisting that people like Garrison and Hayek should be allowed back in the conversation.
Ever read the Snowden book on various schools of macroeconomic thought?
A great "conversational" book.
I also like the work of David Colander.
But such stuff is "fringe" material in your profession.
Perhaps I overstated. But I read your excerpts again and still get the same tone. Perhaps he takes that tone because he is preaching to his followers rather than trying to convert the unenlightened. And perhaps too that Hayek got it better than many other Austrians. (For example, I currently have checked out "Monetary Theory of the Trade Cycle" from the university library as part of an unrelated project. I find his statements about measurement there to be largely unobjectionable.)
But then again, I do stumble across Austrian writings that leave me shaking my head. Take, for example, this one which cites von Mises approvingly (http://www.mises.org/story/1877)
"As Ludwig von Mises explained, '(t)he money equivalents as used in acting and in economic calculation are money prices, i.e., exchange ratios between money and other goods and services. The prices are not measured in money; they consist in money. Prices are either prices of the past or expected prices of the future. A price is necessarily a historical fact either of the past of the future. There is nothing in prices which permits one to liken them to the measurement of physical and chemical phenomena.'"
The author then goes on to say:
"In a private market economy the aims of economic activity are highly diverse and represent individual and subjective valuations. For an economy that is to serve multiple private needs, the calculation of economic growth makes little sense, if any at all. One may add up nationwide the various monetary prices of the goods and services that were sold, but besides the aggregation of the monetary values of diverse items – what is the true and reliable informational value of this exercise?"
Read the whole thing for context. But really, that's a little extreme, no? That's one example, but I'm confident it is not an outlier.
There are some aspects of the Austrian theories that appeal, but noise like that above just gets in the way. I think any Ph.D. economist really does understand the limitations of national income accounting. I lecture on these limitations every semester. And yes, national income accounting has connections to the war-time planning bureaus. But I think it is counterproductive to essentially say that the whole enterprise is a stupid relic of central planning. And that is the message I get from that author.
To be honest, I find Hayek to be one of the least frustrating Austrian economists I have read. (Lawrence White would be be one of my favorite contemporary Austrians.) But am I wrong in thinking that many people who identify themselves as Austrian economists have wandered a bit, much like some of Keynes's followers (who were more Keynesian than he was)?
By the way, I read "Chaos" when it came out (I was in high school). Perhaps my perception is off, but I see the chaos theorists as more gracious towards Newtonian physics than some Austrian economists are towards non-Austrians. Is that an unfair characterization?
"Ever read the Snowden book on various schools of macroeconomic thought?"
Yes, of course. (The one that came out in the mid-'90s, I believe) It's been a while, but remember that I thoroughly enjoyed it. I'd consider reading it again as it really has been a while.
"I also like the work of David Colander."
So do I. (His macro research as well as the teaching articles)
"But such stuff is 'fringe' material in your profession."
If by "fringe" you mean that grad students are not encouraged to spend their time on it, then yes. But honestly, I know many economists who spend time thinking about things that they were never taught (or were discouraged from thinking about) in grad school. Maybe I just hang out with a better than average crowd. :)
It's smart not to confuse the work of Hayek for the work of some Mises influenced economists associated with the Mises Institute.
I can't get some of those folks to acknowledge that entrepreneurial learning in the context of changing prices and quantities is an empirical phenomena, so wedded are they to Mises bogus "Kantian" view of economics.
Note that a good deal of the non-linear phenomena discussed in _Chaos_ simply is a part of Newtonian mechanics.
The 3 body problem is a problem within Newtonian mechanics, and likewise, sensitivity to initial conditions is a problem within Newtonian mechanics. This shows that Newtonian mechanics is incompatible with the simple minded two variable predictive metaphysics of "Laplacian determinism", a surprising result for many who came to Newton with a prior philosophical understanding of the necessary nature of "science".
The science refuted the philosophical picture of "science" that some physicists brought to the table.
Hayek's simple claim is that a proper understanding of microecnomics refutes the picture of "science" that many macroeconomists and econometricians bring to the table. Hayek doesn't reject measurement, statitical analysis, or even macroeconmics, properly understood and properly undertaken.
But he's given good arguments that many economists are in the position of Laplacian determinists -- finding themselves contradicted by the very science they had assumed supported their philosophy of science.
Have you read Arnold Kling on what the macroeconometricians discovered about their "science" in the 1970s?
"It's smart not to confuse the work of Hayek for the work of some Mises influenced economists associated with the Mises Institute."
Fair enough. But there are enough citations and links back and forth that a non-Austrian needs a scorecard to keep straight who to really listen to about what and when.
"I can't get some of those folks to acknowledge that entrepreneurial learning in the context of changing prices and quantities is an empirical phenomena, so wedded are they to Mises bogus 'Kantian' view of economics."
And if YOU feel that way, think about how a non-Austrian economist sees the situation and how our criticisms might be taken by the Mises folks. Neoclassicals have not cornered the market on intransigence.
And when you say "properly understood and properly undertaken" those are pretty strong words. To say that you're doin' it wrong is easy. Your comment on Kling's post, similar to your comment here that started all this was that Hayek explained why macroeconometrics must fail. It's not science.
Ok, well, chaos theory provides a reason (sensitive dependence on initial conditions) why weather forecasters will never be able to perfectly predict hurricanes. "Modern" weather forecasting must fail. So it's not science?
True, the economy and the atmosphere are different things altogether (human action, etc.), but you opened the door on chaos theory. Be that as it may, every economist knows that our models are flawed; though I dare say that many do not properly understand why. If your goal is to encourage more introspection on the "why" I don't have a problem with that. I welcome it. In fact, I've been introspective about that my entire career. So yes, I think Kling's post the other day was very thought provoking. He is trying to answer the "why". I love to read and think about stuff like that.
But I need more than "it's all in Hayek" just like I need more than "it's all in Keynes." By the same token, I believe that while chaos theory is full of both Truth and Beauty, it's not very useful at predicting hurricanes.
Note well, you've never got "it's all in Hayek" from me.
You wrote:
>>But I need more than "it's all in Hayek"<<
Let's focus on a substantive issue, common to both non-linear physical phenomena and the complex ordering process of the market:
sensitivity to initial condition
This sensitivity to initial conditions make simple 2 body Newtonian prediction in impossible.
But it doesn't rule out pattern prediction.
But lets look closer.
WHY is there sensitivity to initial conditions in both cases?
The answers are DIFFERENT.
The problem in physics and chemistry isn't the fact that you are using a "rubber" ruler.
In economics that is the problem. To begin with, micro tells us that utility is not cardinal, it's ordinal.
When we move from micro to the market -- we find all relative values constantly changing in their relations, including the relation of money to all other priced entities.
What you do find in Hayek -- because the guy was a brain scientist and a philosophy of science and mind and social science -- is a fuller discussion of these facts and their implication for building a complex science from the ground up of a field with a special kind of "initial conditions" problem.
Most economists have tried to bluff these problems in various ways (Samuelson, many econemetricians) and they've failed in various ways (a massive literature on that).
So were are we?
We're doing "introspection".
Do we do that at random?
There's a lot to be gained thinking about why macroeconometrics returns the results it does. And there's lots to be gained by thinking about how microeconomics relates to aggregate thinking and money and the business cycle.
Economists are not professionally encouraged to do that kind of thinking. Grad students are actively discouraged from doing it -- and penalized if they do.
Can you name an economists who spend more time thinking about how microeconomics relates to aggregate thinking and money and the business cycle? Can you think of an economist who changed economic thinking more in the process? (Maybe you don't know this history -- growth theory comes out of this, the economics of knowledge comes out of this, Robert Lucas's equilibrium macroeconomics comes out of this,
and on and on.)
All I'm saying -- like Bruce Caldwell -- is that Hayek forced the profession to re-thinking some important things.
And -- like Caldwell -- I'm saying the rethinking process is significantly incomplete. The profession rethought things, but not well, and not enough.
What distracted the profession was variety on now long failed programs.
A big part of the profession is like a puppy that forgot what it was doing and is now doing again and again do what didn't return its promised results the last time, and the time before that, and the time before that ....
Look, you probably get more agreement from me than from a lot of folks you argue with, so let's just keep that in mind.
No one ever really says "it's all in _________", but there is a lot of sniping of that nature. Someone raises an issue. Another retorts, but (Hayek, Rothbard, Mises--pick one) said ___________. Therefore you're wrong. QED. (rinse, repeat)
The conversation has to be a two-way street. Mainstream economics HAS incorporated some of those ideas and rejects others for various reasons. But it's never enough. You, yourself, said that you can't get some of the Mises followers to acknowledge your points. Again, I say if YOU feel that way, just imagine what it looks like to a non-Austrian.
Personally, I think that one of the biggest challenges to economics is the aggregation problem. I have never been fully satisfied with the conclusions of representative agent models because of the aggregation problem. So that's one less thing you need to convince me of.
I think we do not do a good enough job of measuring the things that are really important. One less thing you need to convince me of.
I think that macro needs to do more to acknowledge relative price changes. One less thing you need to convince me of.
But these are not revelations I had last night after reading your comments. These are questions that made me choose to go to grad school in economics in the first place. I was a little disappointed that I didn't find the all the answers, but I haven't stopped thinking about it.
Is some of the problem due to the incentives inherent in the academic profession? Sadly, yes. What more do you want me to say?
And if you say that we need to rethink those things again, and better, I'm with you. I, for one, am open to listening. That is not a guarantee that I will agree. If that's not good enough, I don't know what more I can tell you.
Any economist who believes in thinking about the hard things -- and believes the profession needs room for talking about such stuff that is on my side.
Especially one who believes diverse conversation has a role in the advance of the science.
My original comment pointed to the opening for such a conversation (a traditionally hugely central conversation)and dismay at a profession that effectively has the door to such conversations boarded up and bolted shut.
Happily you are not among those who don't defend that institutional stance.
The funding to prevent states and school districts from sacking people due to money shortage would have quite simply created jobs (relative to the situation without said stimulus), period, end of story. Congress can just write a bill and create jobs occasionally.
Unfortunately, most of that was stripped by three Senate Republicans.
Raivo Pommer
raimo1@hot.ee
Bank LBBW Krise
Dies erfuhr die Deutsche Presse-Agentur dpa am Freitag aus Finanzkreisen. Im Vergleich zu 2007 hat sich die Summe damit mehr als vervierfacht - damals lag der Betrag bei 186 Millionen Euro. Vor einigen Wochen hatte es in Finanzkreisen geheißen, 2008 habe sich die Risikovorsorge auf mehr als 500 Millionen Euro erhöht.
Baden-Württembergs Sparkassen-Präsident Peter Schneider sagte den «Stuttgarter Nachrichten» (Samstag), diese Entwicklung sei kein Widerspruch zu den derzeit gut laufenden Geschäften: «Wir kommen an Kunden, die wir vorher nicht hatten und das zu Konditionen, die das Risiko abbilden», sagte Schneider, der auch Vorsitzender des Verwaltungsrates der LBBW ist, dem Blatt.
Grund für den rapiden Anstieg sind Informationen aus Finanzkreisen zufolge vor allem sinkende Bonitätsnoten für Unternehmen. Da die Finanzkrise zunehmend auf die Realwirtschaft übergreift, steigt die Gefahr, dass Kreditnehmer ihren Verpflichtungen nicht mehr nachkommen können.
Could bail out and stimulus dollars be finely tracked and control given to sortition juries. Those receiving stimulus dollars would
get Stimbucks in a special account. Their expenditures get tracked
and put in Stimbuck accounts for the recipients. Eventually, the
receipient, lets say an otherwise unemployed worker, working on
an energy project supported by the stimulus, spends money on a
fungible or minor manuractured good, say toilet paper. At that point, the Stimbucks get converted to real dollars and money goes to the economy.
Thus, no large bonuses, ("http://www.huffingtonpost.com/2008/07/02/nation-buys-porn-with-sti_n_110457.html")
no money to porn sites.
Stimulus checks helped on-line adult web sites grow their traffic
by twenty to thirty percent>. (Admittedly, other
economists analyzing this data show a much lower rate.) ("http://freakonomics.blogs.nytimes.com/2008/08/04/did-the-economic-stimulus-plan-overstimulate-some-a-guest-post/")
NO stimulus money to support foreign manufacturing for things
not critical, e. g. a plasma TV.