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#255482 - 04/17/13 01:06 PM America isn't broke and your austerity study sucks
Jeffery J. Haas Offline
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Registered: 08/03/04
Posts: 10508
Loc: Downey, California
Quote:
Influential research by U.S. economists Carmen Reinhart and Ken Rogoff, touted by policymakers pushing government austerity in the United States and Europe, is riddled with errors, a bombshell new academic study claims.


http://www.huffingtonpost.com/2013/04/16/reinhart-rogoff-austerity-research-errors_n_3094015.html

Quote:

Now three scholars at the University of Massachusetts have done so in "Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff" and they find that the Reinhart/Rogoff result is based on opportunistic exclusion of Commonwealth data in the late-1940s, a debatable premise about how to weight the data, and most of all a sloppy Excel coding error.


http://www.slate.com/blogs/moneybox/2013...bad_coding.html

Quote:

Now researchers at U Mass at Amherst have refuted the study — they find that not only was the data tainted by bad statistics, it also had an Excel error . Apparently when averaging a few GDP numbers in an excel sheet, they did not drag down the cell ranges down properly, excluding Belgium.


http://news.slashdot.org/story/13/04/17/..._medium=twitter


Quote:
Reinhart and Rogoff said Wednesday that Herndon, Ash, and Pollin are correct in spotting the error, adding that they made a "regrettable slip" with a calculation in one of the report's data tables but believe that it doesn't change the central message of the paper.
ROTFMOL tinfoilhat

http://www.cnbc.com/id/100648042




http://www.washingtonpost.com/blogs/wonk...eadsheet-error/

Reinhart and Rogoff's work has been influential in the austerity debate in recent years, as some governments that saw growth slow and debt rise responded with spending reductions and higher taxes, which in some cases, such as the United Kingdom, have hurt demand.

http://www.reuters.com/article/2013/04/17/global-economy-debt-idUSL2N0D404P20130417

I think we have reentered the era of gurus and ga-ga, where people are cited as being influential without proper experiential or moral vetting. America, and indeed perhaps the entire Western world, seems to have descended into a type of rock star worship which would embarrass any rational thinker that values the lessons of history.

Indeed, this is not surprising when one considers that the entire planet has apparently fallen under the thrall of a revisionist tsunami.

History? We got your steenking heestory. devil


Edited by Jeffery J. Haas (04/17/13 03:14 PM)
_________________________
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to what we have plus a little more Keynes. Why?"

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#255491 - 04/17/13 03:13 PM Re: America isnot broke and your austerity study suck [Re: Jeffery J. Haas]
Chuck Howard Offline
old hand

Registered: 09/17/01
Posts: 6723
Loc: Philly 'burbs
Quote:
Reinhart and Rogoff said Wednesday that Herndon, Ash, and Pollin are correct in spotting the error, adding that they made a "regrettable slip" with a calculation in one of the report's data tables but believe that it doesn't change the central message of the paper.


And just what is that central message? Let me guess. How about this: we should just continue to squeeze more dollars from what's left of the middle class as well as from the poors and the olds so we can funnel more dollars to the 1%. That is the goal of austerity. That is the only goal of austerity.


Edited by Chuck Howard (04/17/13 03:21 PM)

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#255515 - 04/17/13 09:15 PM Re: America isn't broke and your austerity study sucks [Re: Jeffery J. Haas]
issodhos Offline
Pooh-Bah

Registered: 09/29/05
Posts: 12581
It certainly does not hurt to double check claims made by proponents of New Keynesianism (Bernanke, Krugmanm, and Stiglitz to name a few). Guess if a boo boo is made, it might as well be a macro boo boo:-)
Yours,
Issodhos
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#255517 - 04/17/13 10:17 PM Re: America isn't broke and your austerity study sucks [Re: Jeffery J. Haas]
Ardy Offline
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Registered: 12/22/05
Posts: 11656
Loc: San Jose, Ca USA
The fact is that most macro economic theories are pretty mostly impossible to prove based on such "facts."

Either economic kensiam or Austrian economics collapses when driven to illogical extremes.

That said, the dire predictions of those who oppose Bernake's policies seem not to have been born out by the facts. Overall economic performance of economies in the post keynsian world seems to be quite good, and actually less prone to dramatic economic swings than was the case in the pre-keynsian world. This despite the serial abuse of keynes expressed views that economic policy should not only stimulate durning economic weakness, but also constrain during boom periods. (it is called counter cyclical intervention)

Of course, I would be happy as always to engage in a fact based debate with anyone who proposes that economic calamities were rare during the period before Keynes.... any takers? I thought not.


Edited by Ardy (04/17/13 10:48 PM)
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#255526 - 04/18/13 07:18 AM Re: America isn't broke and your austerity study sucks [Re: Jeffery J. Haas]
NW Ponderer Offline
Moderator
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Registered: 09/09/11
Posts: 11849
Here's a little tidbit factoid: almost all economies "recover" at some point, regardless of what a government might do. It can be demonstrated that Keynsian policies tend to shorten that process, while Austrian/austerity measures tend to lengthen/weaken that process. You are of course right, Ardy, that governments tend to ignore the countercycle when times are good (George W. Bush), thus deepening the inevitable slides that come. Washington State estabished a "rainy day" fund, which significantly countered the early effects of the Bush-induced recession, before that was overwhelmed by the depth of it. All boats founder on an extreme neap tide.*

*I made an error in thinking that neap was the opposite of flood tide, rather than spring tide. Extreme low tides generally occur during spring, not neap, tides. Oops. But I still like the term, neap, and I could excuse it,.. no, really, I can't.


Edited by NW Ponderer (04/18/13 07:27 AM)
Edit Reason: scientific error
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A well reasoned argument is like a diamond: impervious to corruption and crystal clear - and infinitely rarer.

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#255559 - 04/18/13 06:40 PM Re: America isn't broke and your austerity study sucks [Re: NW Ponderer]
Ardy Offline
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Registered: 12/22/05
Posts: 11656
Loc: San Jose, Ca USA
Originally Posted By: NW Ponderer
You are of course right, Ardy, that governments tend to ignore the countercycle when times are good (George W. Bush), thus deepening the inevitable slides that come.


Yes, well let's take a fantastical journey down the memory lanes of Austrian/Libertarian apologists.

Let's start with the reviled presidency of Bill Clinton... who left office with what some people said was a concerning government budget surplus. Whether or not it was an "actual" surplus, it was unarguably dramatically different than the years that followed. The Clinton era was a period when counter cyclical economics was actually practiced, more or less sucessfully. And for this reason, our Austrian sympathizers must necessarily igonore the period since it does not correspond to their hysterical anti Keynesian meme.

Then we move to the period of George bush, the younger. Despite the proclamations of Mr. Bush, we are not allowed to consider him or his self proclaimed Libertararian colleague Allan Greenspan as being at all conservative. No, we most consider their failures as the height of Keynesian economic policy and a clear indication of the failure of the policies suggested by John Maynard Keynes.

And, we are constantly reminded that libertarian economics "has never been tried", and therefore must necessarily be the solutions to any problems that we encounter. While every bone-headed policy move by conservatives is represented as a full test and contra-proof to Keynesian policies (policies that were scorned by the those leaders.)

And, to top it all, this all is presented as factual conclusive "proof" of the bankruptcy of Keynesian economics. And, of course we cannot even begin to discuss why Austrian economists have 60 years of failed cataclysmic predictions. Details details details..... one should never allow details to erode the enjoyment of a really terrific fantasy.



Edited by Ardy (04/18/13 11:42 PM)
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#255572 - 04/18/13 08:04 PM Re: America isn't broke and your austerity study sucks [Re: Ardy]
issodhos Offline
Pooh-Bah

Registered: 09/29/05
Posts: 12581
Originally Posted By: Ardy
The fact is that most macro economic theories are pretty mostly impossible to prove based on such "facts."

Either economic kensiam or Austrian economics collapses when driven to illogical extremes.


Uh, Ardy, these two and their critics are kinda sorta from the New (not "neo", not "post") Keynesian school of economics folks -- no Austrian economics types in the bunch. They are basically family arguing over re-arranging the living room furniture. It is fun to watch them squabble among themselves, though. :-)
Yours,
Issodhos
_________________________
"When all has been said that can be said, and all has been done that can be done, there will be poetry";-) -- Issodhos

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#255583 - 04/18/13 10:07 PM Re: America isn't broke and your austerity study sucks [Re: Jeffery J. Haas]
NW Ponderer Offline
Moderator
veteran

Registered: 09/09/11
Posts: 11849
And that, my good friends, is what is colloquially known as, "Deflection." Most amusing, to me at least, is that Ardy scripted it in his last post.
_________________________
A well reasoned argument is like a diamond: impervious to corruption and crystal clear - and infinitely rarer.

Here, as elsewhere, people are outraged at what feels like a rigged game -- an economy that won't respond, a democracy that won't listen, and a financial sector that holds all the cards. - Robert Reich

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#255598 - 04/19/13 06:56 AM Re: America isn't broke and your austerity study sucks [Re: NW Ponderer]
Chuck Howard Offline
old hand

Registered: 09/17/01
Posts: 6723
Loc: Philly 'burbs
Originally Posted By: NW Ponderer
And that, my good friends, is what is colloquially known as, "Deflection." Most amusing, to me at least, is that Ardy scripted it in his last post.


I guess that it's appropriate that this site's master of deflection would note an example of deflection. Most amusing.

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#255600 - 04/19/13 07:06 AM Re: America isn't broke and your austerity study sucks [Re: Jeffery J. Haas]
NW Ponderer Offline
Moderator
veteran

Registered: 09/09/11
Posts: 11849
I'm still puzzling over the meaning of that post...
_________________________
A well reasoned argument is like a diamond: impervious to corruption and crystal clear - and infinitely rarer.

Here, as elsewhere, people are outraged at what feels like a rigged game -- an economy that won't respond, a democracy that won't listen, and a financial sector that holds all the cards. - Robert Reich

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