Penn Jillette's counterintuitive commentary

[WinstonCountyWildman]

I have yet to hear any economist argue that government spending is not only essential at this point, but also the only recourse left.

GDP = consumer spending + investment + exports + government spending.

So consumers aren't spending because jobs are hemorrhaging, investment isn't happening because the fed has already lowered rates to zero and the market is tanking, and we're a net importer.

Has anyone even offered an alternative stimulus plan besides

1. Tax cuts
2. ????
3. Profit!

Or should we just let this situation play itself out? If so, why won't they argue for that explicitly?

I can offer one

For a little less than all the stimulus packages etc we can give every single adult american 200,000 dollars

make this mandatory to receive said monies. Use the monies for....

1 must pay off mortgage. If no mortgage or no home ownership must buy a home
2 pay off car loan, if no car loan and car is over ten years old must buy car
3 pay off all medical debts
4 blow the rest on regular consumer items like tv,game systems etc. American made only.
5 no saving it. must blow hell out of all of it

Simple but much more effective than the clusterf*** we are using now

 

[mhaze]

Originally Posted by Beerina
The government is the only entity that can restrict freedom.

A common error, but an error nonetheless.

I was once held hostage at gunpoint. I'm pretty sure that guy wasn't working for the government.

My boss restricts my freedom in a big way. ....

Beerina is essentially correct.

If you enter into a contract for employment, you have of your own volition accepteid the group of constraints therein, some of which you might of course grumble about.

Part of one's contract with government is permitting gov. to carry guns and exercise force, the reason for that is that one is subcontracting to that extent for protection, which includes to some extent protection against others exercising force.

But government unilaterally enrolls a new citizen in its contract at birth with no termination clause excepting death, with the exception of some nations which allow exit and revokation of citizenship.

The several objections raised to Beerina's comment all fit within this framework as far as restrictions of freedom within the world of man.

Excludes restriction of freedom due to close proximity of grizzly bear.

Includes restriction of freedom due to government banning handguns and subsequently, the actual threat and danger of the grizzly bear, which is different than it's proximity.

 

[qwints]

But the idea that people are free to work or not work is just empirically wrong. Poverty IS compulsion.

 

[Unabogie]

I can offer one

For a little less than all the stimulus packages etc we can give every single adult american 200,000 dollars

make this mandatory to receive said monies. Use the monies for....

1 must pay off mortgage. If no mortgage or no home ownership must buy a home
2 pay off car loan, if no car loan and car is over ten years old must buy car
3 pay off all medical debts
4 blow the rest on regular consumer items like tv,game systems etc. American made only.
5 no saving it. must blow hell out of all of it

Simple but much more effective than the clusterf*** we are using now

You know, I've heard this one before, and I appreciate your suggesting it because at least we're agreeing on a set of facts and we can then argue over the solution.

I don't see any economists suggesting this, and I think I can see some obvious problems with it.

1. Cries of Socialism. The right wing would scream to the heavens in a bunch of poor people were given that much cash. Can you see congress passing such a bill?
2. What do you get for it? Big TVs and XBoxes? At least with a public works projects, we're going to get high speed rail and a new electrical grid. Stuff that will grow our economy for decades. Think of the internet and how much money we make off of having it. More like that, please. True, I think they focused too little on both of those and it should have been a lot more money for those to make sure they are completed.
3. Who enforces the spending rules? How big a bureaucracy would you need to enforce it? At least with a stimulus, you fund existing bureaucracies and then they are easily audited.
4. If everyone has this shiny new money to buy houses or cars with, doesn't that cause inflation?

I also thought that the government should save the car companies by simply ordering a new fleet of fuel efficient vehicles (which they did) but rather than hybrids, they should be all electrics like the Volt. And order millions of them. Or offer a one time, 100% tax credit for going all electric. For some reason, ideas like this never gain traction.

Still, we both understand the need for government spending, as opposed to inaction, which is what mhaze is suggesting.

 

[Meadmaker]

Originally Posted by Beerina [qimg]http://www.internationalskeptics.com/forums/helloworld2/buttons/viewpost.gif[/qimg]
The government is the only entity that can restrict freedom.


Beerina is essentially correct.

Beerina is dreadfully wrong.

Qwints points out the essential flaw.

Consider, for example, my case. I made a bargain with my employer that I would provide services, and he would provide a certain amount of money. Excellent. Two entities engaged in free negotiation. Total freedom. Last week, though, I got a letter from my employer saying he had changed his mind, and that he was taking cost cutting measures that would result in me getting approximately 13% less money than we had previously negotiated for.

Hmmmm..... well, no problem. I am totally free to break my agreement with that employer and find another that will accomodate the lifestyle to which I have been accustomed. Complete freedom. Except....I can't. 10% of the people (at the official unemployment rate, actually much larger) in Michigan are ttying to find such an arrangement, and failing. My employer knows that he can get exactly the same services he previously contracted for, but at lest cost. He knows he can get away with that, because he knows that I do not, in fact, have the freedom to go elsewhere.

I don't have a problem with that. I don't feel oppressed by evil capitalists. In fact, I am one. The truth is that if I could find someone to give me more money, I would drop my employer like a hot rock. I don't have any objection to him doing the same for me.

Fortunately, in this country, one of the things that allows this is that we have the "social safety net". An employer can use his power to influence what sort of house I live in, and what sort of car I drive, but he cannot actually make me starve, and his ability to impact my health is limited. Therefore, in things that really matter, he can't exercise much control over me. However, his inability to exercise such control is precisely the result of restrictions on laissez-faire capitalism. A "social safety net" is not part of that system. By having it, we ensure that people will not tolerate, indeed are not allowed to tolerate, such things as unsafe workplaces, or backbreaking and spirit numbing labor that is still inadequate to live a healthy, respectable, life. I like it that way.

Lots of countries don't have that. They are lousy places to live.

What does this have to do with the current situation? We find ourselves in a situation where laissez-faire capitalism would dictate that failing companies, like GM and Bank of America, would go out of business. Government would do nothing, and they would stop. At that point, there would be massive unemployment because, like it or not, the workers at those companies do not have the freedom to simply start working somewhere else. There are no laws that prevent them from doing so, but they can't. The resulting diminution of economic status for all of those workers, and those who are affected by the "ripple effects", represent a real loss of freedom for the affected workers.

So, government may be able to increase freedom for more people by interfering in the marketplace.

Should they do so? I'm undecided myself. I am generally opposed to such actions, because the taxes necessary to fund such things also represent a real loss of freedom, and the borrowing which is being used instead of taxes represents a real loss of freedom to people who didn't even choose to take the actions. (i.e. our children will have less freedom due to our borrowing.) I'm just saying that you cannot claim that unrestricted laissez-faire capitalism maximizes freedom, nor can you try to apply that philosophy to the practical example of today's government policy.

 

[gdnp]

I can offer one

For a little less than all the stimulus packages etc we can give every single adult american 200,000 dollars

make this mandatory to receive said monies. Use the monies for....

1 must pay off mortgage. If no mortgage or no home ownership must buy a home
2 pay off car loan, if no car loan and car is over ten years old must buy car
3 pay off all medical debts
4 blow the rest on regular consumer items like tv,game systems etc. American made only.
5 no saving it. must blow hell out of all of it

Simple but much more effective than the clusterf*** we are using now

Let's see, lets generously assume 2 trillion in stimulus funds, and assume that all this money has been or will be simply pissed up against the wall: the government will never receive anything of benefit for it. Now let us divide by $200,000, your amount per adult.

By my math, you are estimating the adult population of the US to be 10 million people. I suspect this may be a bit low, perhaps by an order of magnitude or more. In fact, Wikipedia quotes the adult population as 228 million and change as of 2008.

How much would it cost to give 228 million people $200,000 each? Hmm, that would be 45.6 billion dollars. Which if I am not mistaken is slightly more than current plans for stimulus spending.

So let's try again.

2 trillion divided by 228 million comes out to $8771 per person. Certainly not a trivial amount, but not enough to pay off your mortgage.
Not enough to buy a new car, or even a recent model used car.
Not enough to pay off medical debts for anyone who has suffered a major uninsured illness.
Which leaves us with American made consumer items. If you can find any. My Dell computer was made in Malaysia. Playstation and Wii are Japanese, which leaves Xbox, which somehow I doubt is made in America. Can you point me to a US HDTV factory?

Any other great suggestions?

 

[Meadmaker]

I don't see any economists suggesting this, and I think I can see some obvious problems with it.

Over in the economics forum, I created a thread calling for something called the Stupid Economic Stimulus Plan, that was different, but just as stupid, as the Winston Facetious Stimulus Plan. (Mine demanded immediate consumer spending by replacing part of your paycheck with gift cards.) Like Winston's plan, the plan had obvious problems.

And that's the point. Winston (WCW? Wildman? No way I'm typing out that long moniker every time.) threw out the gobbledygook of the economic stimulus plans, with all the multipliers and Keynesian theoretical mumbo jumbo and projected balance of GDP and economic modelling, and reduced it to a much simpler plan. In doing so, he made a plan where the flaws were obvious, instead of hidden behind a smokescreen of intellectualism.

However, he's right. If the current plan would work, so would his plan. Strip away the fancy schmancy pseudoscience (most economics is, in my not very humble opinion, pseudoscience), and you end up with Winston's plan.

(ETA: Although, gdnp corrected the math.)

 

[Unabogie]

Over in the economics forum, I created a thread calling for something called the Stupid Economic Stimulus Plan, that was different, but just as stupid, as the Winston Facetious Stimulus Plan. (Mine demanded immediate consumer spending by replacing part of your paycheck with gift cards.) Like Winston's plan, the plan had obvious problems.

And that's the point. Winston (WCW? Wildman? No way I'm typing out that long moniker every time.) threw out the gobbledygook of the economic stimulus plans, with all the multipliers and Keynesian theoretical mumbo jumbo and projected balance of GDP and economic modelling, and reduced it to a much simpler plan. In doing so, he made a plan where the flaws were obvious, instead of hidden behind a smokescreen of intellectualism.

However, he's right. If the current plan would work, so would his plan. Strip away the fancy schmancy pseudoscience (most economics is, in my not very humble opinion, pseudoscience), and you end up with Winston's plan.

(ETA: Although, gdnp corrected the math.)

Except you're not acknowledging the benefits of both stimulus and infrastructure.

GDP can be goosed by the government, and if they goose it by investing in things that bring back a return on investment for everyone, it's a good investment.

1. The internet
2. The highway system
3. The railroads (soon to be high speed)
4. The new electrical grid which can give us true wind and solar power

Those are all good things, and can only be done (or in practice can only be done) by government.

 

[Meadmaker]

Except you're not acknowledging the benefits of both stimulus and infrastructure.

That's a good point. Part of the Obama plan actually includes creating real stuff. To the extent that the real stuff that gets built is actually worthwhile, the stimulus plan has benefits beyond the mumbo-jumbo. So, the bridge building and such has real benefits, but the manipulation of who owes what to whom is basically the same as the Winston plan.

(And I'm not so sure about that wind and solar power part, but that's for the science forum. Wishful thinking and deficit spending won't create watts of power.)

 

[mhaze]

Beerina is dreadfully wrong.

Qwints points out the essential flaw.
....

0h, no doubt your case is stronger when the goalposts are shifted far from Beerina's statement.

 

[applecorped]

It's a classic argument from authority situation.

In terms of magic, tricks, and misdirection, Penn is a perfectly valid authority. As far as politics go, his opinion carries about as much weight as mine does.

Don't underestimate yourself. You carry plenty of weight.

 

[applecorped]

Let's face reality here, folks.

No thanks. I prefer illusion to despair.

 

[applecorped]

Bunch of nonsense from a blowhard is what it sounded like. Come back when you have facts, figures, and arguments instead of hyperbole and catchy phrases.

This is addressed to Obama, right?

 

[Hittman]

He seems awfully smart, but my intuition tells me that this whole thing ends very badly. Like Jillette, I hope Obama knows something I don't,

The problem is we're not casual observers. We're sitting in the passenger seat, helpless, whie he accerates towards the brick wall. And he and his wealthy friends have one thing we don't – ejection seats.

Finally, let's not forget the systemic discrimination against racial and religious minorities that laissez-faire capitalism was unable to solve.

You have that backwards. Capitalism was working on that problem quite nicely until the government interfered. A businessman who discriminates in favor of green is going to succeed over one who discriminates in favor of skin color.

http://www.capmag.com/article.asp?ID=4457

For a little less than all the stimulus packages etc we can give every single adult american 200,000 dollars

I guess it depends on how you count it – I've seen numbers from $120k to $240k. I rather like the idea of just handing out the money, but I wouldn't make any rules about how to spend it. (Not that this would ever happen.)

Some of us would use it to pay off our mortgages and CC bills, which would give the banks cash and help the economy.

Some would buy big ticket items, like cars and boats, which would help the economy.

Some would spend it on travel, which would help the economy.

Some would start their own businesses, which would help the economy.

Some would spend most of it on lotto tickets, which would help the government.

Overall, the effect would be spread out all across our economy, and just about every sector would benefit.

My boss restricts my freedom in a big way. Oh, sure, I could just stop working for him. It's a bargain I made. I will do certain things, like not telling him that he is a total moron, in exchange for some money. I have complete freedom in this matter. I can simply choose to make a different bargain with someone else. Right?

Right. You entered into the contract freely, and can leave it freely. No one has removed any of your freedom by force – you have willingly removed some of it because it's to your advantage.

In the not very recent past, one of the things that was part of that bargain was that I would not admit to homosexuality. If I said, "By the way, I'm gay," he could fire me. Today, he can't do that. Laissez-faire capitalism would say he ought to have that right, but in our system of government, today, he can't. I like our system better.

So you'd prefer to work for a bigot than someone who respects your abilities and talents?

And the flip side of that is that it is very, very difficult for your employer to fire an incompetent worker who happens to be gay (or any other minority), out of fear of government reprisals. He either has to go through an extensive plan to do it, reducing but not eliminating his risk of being sued, or put up with the incompetent, depriving a more worthy worker of a job, and himself of the profits that more worthy worker would generate.

 

[mhaze]

....Still, we both understand the need for government spending, as opposed to inaction, which is what mhaze is suggesting.

Really believe that?

And you are going to fix the problem of too much spending with more spending?

2009 the pension plans and commercial real estate flop, and the Chinese pull out of dollars. (Say to the order of 1.2T, 1.3T, and 0.8T ). SS trust fund goes negative in 2011 for good, it teetered negative in feb. but that was a short month.

And those four problems not yet emergent, you fix them, too....with more spending? To get to where? Where we were in 2007? We cannot buy a time machine to put us back there by printing money. That is what the numbers say.

So...how'ya like that Hope and Change?

 

[Meadmaker]

0h, no doubt your case is stronger when the goalposts are shifted far from Beerina's statement.

Beerina's statement is that government is the only entity that can restrict freedom. That's wrong.

An earlier statement said that laissez-faire capitalism was the only system that ought to be considered, because every other system restricted freedom. (That's a paraphrase from memory, not an exact quote.) That's wrong.

There's no goalpost shifting going on here. Other entities can restrict freedom, and laissez-faire capitalism does not maximize freedom.

 

[mhaze]

Beerina's statement is that government is the only entity that can restrict freedom. That's wrong.

An earlier statement said that laissez-faire capitalism was the only system that ought to be considered, because every other system restricted freedom. (That's a paraphrase from memory, not an exact quote.) That's wrong.

There's no goalpost shifting going on here. Other entities can restrict freedom, and laissez-faire capitalism does not maximize freedom.

I disagree on several grounds,but don't care to derail this thread with it-just wanted to point out that your response was not specific to gov:freedom.

 

[Meadmaker]

So you'd prefer to work for a bigot than someone who respects your abilities and talents?

I would prefer to work for a very rich half-wit who overestimates the value of my labor, and I really don't care what he thinks about my sexual preference. (Full disclosure statement: I'm not actually gay. It was just an example. If anyone needs a specific thing that actually applies to me, substitute overweight, or Jewish. Not that most people on JREF care, I just didn't want to confuse anyone who might have seen apparent contradictions in other threads.)

Unfortunately, the point is that I don't have complete freedom to sell my abilities and talents anywhere, because the marketplace is not infinite. If there are only two employers in town, and both hate homosexuals, and I'm homosexual, then my freedom is restricted, and not by government.


If government demands that he hires qualified homosexuals, my freedom is enhanced, by government action.

And the flip side of that is that it is very, very difficult for your employer to fire an incompetent worker who happens to be gay (or any other minority), out of fear of government reprisals.

So, a balance must be struck, and at any given point in time, it's almost always wrong. Sometimes employers have too much freedom. Sometimes, too little.

 

[Unabogie]

That's a good point. Part of the Obama plan actually includes creating real stuff. To the extent that the real stuff that gets built is actually worthwhile, the stimulus plan has benefits beyond the mumbo-jumbo. So, the bridge building and such has real benefits, but the manipulation of who owes what to whom is basically the same as the Winston plan.

(And I'm not so sure about that wind and solar power part, but that's for the science forum. Wishful thinking and deficit spending won't create watts of power.)

Specifically, I'm referring to this, just for clarity:

A high-voltage, direct current (HVDC) electric power transmission system uses direct current for the bulk transmission of electrical power, in contrast with the more common alternating current systems. For long-distance distribution, HVDC systems are less expensive and suffer lower electrical losses. For shorter distances, the higher cost of DC conversion equipment compared to an AC system may be warranted where other benefits of direct current links are useful.

[..]

A number of studies have highlighted the potential benefits of very wide area super grids based on HVDC since they can mitigate the effects of intermittency by averaging and smoothing the outputs of large numbers of geographically dispersed wind farms or solar farms.[18] Czisch's study concludes that a grid covering the fringes of Europe could bring 100% renewable power (70% wind, 30% biomass) at close to today's prices. There has been debate over the technical feasibility of this proposal[19] and the political risks involved in energy transmission across a large number of international borders.

 

[Tsukasa Buddha]

The government is the only entity that can restrict freedom. They're the only ones who can send police to round you up if you refuse to "buy" their product. That's why I have to laugh at the concept of "political science" -- it's the only "science" that finds it ethical to experiment on unwilling test subjects.

In any case, historically, the big problems are always traceable to people with guns forcing their will on people. "Sugar trusts" and whatnot (I can hear the meme defense mechanisms prepping to regurgitate stuff like this) are, historically, incredibly minor as far as detracting from "quality of life". You have to think to yourself, a trust is bad...compared to what?

Oh, government-phobes are funny.

Tell me, what ridiculous definition of "freedom" are you using?