some questions for governments

Discussion in 'Economics' started by morganist, Sep 30, 2009.

  1. i find frequently that economic pundits are not asking the questions i would like answer to. these are some of them.

    what do you think are there others you would ask? so any of them seem pointless to ask (why)?

    How will you increase aggregate demand if the fiscal stimulus does not work as well as expected?

    How will you control inflation if it rises in the future? Is an interest rate increase possible with the damage it will cause the wider economy?

    Where will you get funding if more bond strikes occur?

    How will you reduce debt if the interest rate stays low for long periods of time?

    How will you prevent pensioner poverty when income they receive is reduced through low interest rates and will likely be for the foreseeable future?

    How will you provide sustainable investment for businesses, which will not be effected by interest rate rises if they occur in the future?

    Can you control the economy with monetary policy considering the wider consequences to businesses and the private sector an increase in interest rates will create and conversely the consequences to savers if the interest rates remain low?

    Can you control the economy with fiscal policy as government debt is enormous so more borrowing is not possible? Can you afford to increase taxation in the future due to effect on the wider economy?
  2. any other suggested questions?
  3. The game is not to ask them what they will do, but figure out what they will HAVE to do. Asking them for answers to those questions will just result in lies. Lies that are meant to satisfy the everyday citizen so he can go back to watching survivor, deal or no deal, or whatever other program he likes.

    Figuring out the end game is easy. You just take all the facts, then figure out the ways to get out of it. Then factor in what they can do to paint themselves in the best possible light, while making everything about the economy look good so they can get themselves re-elected next term while at the same time trying not to collapse the economy but make sure everyone gets what they want (in that order).

    Then you can figure it out quite easy. Inflate, inflate, inflate! If we get deflation, then income tax goes down. If income tax goes down, the government has to raise taxes, if that happens, then they dont get relected. So deflation is definately something they want to stay away from. Also with deflation its will be harder to pay off 12 trillion.

    If they inflate by dropping money out of helicopters with homebuyer credits, cash for clunkers and just handing out free money once per year to get people buying stuff, then it works out better(for the politicians). Inflation lets the government spend more, it will make stock prices go up, housing prices go up and last but not least, wages go up. Inflation will also give the illusion to most people that if they are getting paid more money than last year, things must be ok and our elected officials are doing their job and that will get them re-elected.

    nobody wants their house to drop another 50% in value. Inflation is the only answer for now.
  4. agreed this is why i sent them what i would do to show the answers.