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Thread: To austerity fans: what'll happen if we impose the cuts you want?

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    Default To austerity fans: what'll happen if we impose the cuts you want?

    So, we take another fun jaunt on the circular argument merry-go-round.

    Once again, the austerian hordes are demanding that we cut, cut, cut. They repeat, ad nauseam the ever-reducing deficit figures, insisting that these figures demand we eliminate the deficit NOW!!1!!one!!

    They stay resolutely silent, of course, on the immediate consequences. There's a pretty obvious reason for this: Greece. They imposed heavy cuts and the entire economy shrank 20%. Very very stupid of the austerians to have demanded that, they now concede. If a Company X owes you money, you might demand that Company X starts cutting spending. But if the spending cuts cause Company X to lose 20% of its customers in a very short space of time, you'll call an end to the cuts if you have any desire to eventually get some of your money back. No company can survive long if it's losing 20% of its customers every few years. You don't get more milk by beating the cow to within an inch of her life. In fact you get less milk as it doesn't lactate as much while it heals.

    So I'm putting you on the spot now. Every austerian, tell me what you imagine will happen in the immediate aftermath of imposing €10bn of cuts. GDP will either rise of fall as a result.

    1: Will GDP go down immediately after the cuts? Yes/no question, please do not evade a clear answer.

    2: If GDP goes down, how far will it go down? At what figure, if any, will GDP cease to fall? Give a figure, please do not evade a clear answer.

    NB:In Greece it was 20%, and they only stabilised at that figure because they received a transfer from the Troika, meaning the Troika's Greek austerian plan was a total failure.

    3: Will GDP, at some point subsequent to the fall, start to rise again? Yes/no question, please do not evade a clear answer.

    4: If some kind of GDP growth does happen, from whence do you see the demand coming from to fuel this growth? Who's going to be buying the goods and services that makes this recovery happen? Specifics, please. Will this demand be mostly from within Ireland or mostly external? Why would they be spending in Ireland then if they're not spending in Ireland now? Don't handwave it away, tackle the issue.
    Last edited by feargach; 29th January 2013 at 04:11 PM.
    When you see the words "Mises" or "Hayek" in someone's post, just ask yourself: do I really want to ban paper money and go back to gold?

    You have to pity the kind of people who buy into conspiracy theories. I find the following to be the saddest words on the internet: "Re: connection between Bilderberg puppet lady gaga and viral outbreak in ukraine "

  2. #2
    Ramps
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    1: Will GDP go down immediately after the cuts? Yes/no question, please do not evade a clear answer.
    Yes. So what...

    2: If GDP goes down, how far will it go down? At what figure, if any, will GDP cease to fall? Give a figure, please do not evade a clear answer.
    How could anyone know.

    3: Will GDP, at some point subsequent to the fall, start to rise again? Yes/no question, please do not evade a clear answer.
    If the govt. doesn't make the same mistakes again, yes.

    4: If some kind of GDP growth does happen, from whence do you see the demand coming from to fuel this growth? Who's going to be buying the goods and services that makes this recovery happen?
    The demand will come from people who are spending their own money on goods and services they value.

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    The people who demand to know what will happen if there are MORE cuts, tend to be quite poor at telling us how we would pay for it if there were NO cuts.

    I'm pretty sure the OP falls into that category.

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    Quote Originally Posted by Ramps View Post
    The demand will come from people who are spending their own money on goods and services they value.
    Why didn't you just say:

    The demand will come from carbon-based life-forms.

    or

    The demand will come from people with two eyes and a liver each, in the overwhelming majority of cases.

    or

    The demand will to a large extent come from beings who enjoy the music of the Beatles and often consume food with a high fat content.

    In economics, we kind of have higher standards of specificity than that. Can you try harder to be more specific? For example, by indicating where they got their money from, where they are located geographically, where their banks are (you should explain how the banks managed to avoid collapsing, because that is far from obvious).
    When you see the words "Mises" or "Hayek" in someone's post, just ask yourself: do I really want to ban paper money and go back to gold?

    You have to pity the kind of people who buy into conspiracy theories. I find the following to be the saddest words on the internet: "Re: connection between Bilderberg puppet lady gaga and viral outbreak in ukraine "

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    Politics.ie Member stopdoingstuff's Avatar
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    Quote Originally Posted by feargach View Post

    1: Will GDP go down immediately after the cuts? Yes/no question, please do not evade a clear answer.
    Obviously it will.

    Quote Originally Posted by feargach View Post
    2: If GDP goes down, how far will it go down? At what figure, if any, will GDP cease to fall? Give a figure, please do not evade a clear answer.

    NB:In Greece it was 20%, and they only stabilised at that figure because they received a transfer from the Troika, meaning the Troika's Greek austerian plan was a total failure.
    How can anyone possibly know?

    Quote Originally Posted by feargach View Post
    3: Will GDP, at some point subsequent to the fall, start to rise again? Yes/no question, please do not evade a clear answer.
    Yes.

    Quote Originally Posted by feargach View Post
    4: If some kind of GDP growth does happen, from whence do you see the demand coming from to fuel this growth? Who's going to be buying the goods and services that makes this recovery happen?
    The people who are not spending now are deferring consumption. At some point this money will be invested and spent.
    Faoi mhóid bheith saor

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    Quote Originally Posted by Ryan Tubbs View Post
    The people who demand to know what will happen if there are MORE cuts, tend to be quite poor at telling us how we would pay for it if there were NO cuts.

    I'm pretty sure the OP falls into that category.
    You ought to be aware that the IMF (which is to say, the people who loan us money with the expectation of getting it paid back) are among the people who are opposed to more cuts.

    If you think we will be unable to repay, you really ought to explain why the IMF doesn't agree with your analysis.
    When you see the words "Mises" or "Hayek" in someone's post, just ask yourself: do I really want to ban paper money and go back to gold?

    You have to pity the kind of people who buy into conspiracy theories. I find the following to be the saddest words on the internet: "Re: connection between Bilderberg puppet lady gaga and viral outbreak in ukraine "

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    Quote Originally Posted by stopdoingstuff View Post
    The people who are not spending now are deferring consumption. At some point this money will be invested and spent.
    Who the hell are they? Are they in Ireland, the Caymans, London or what?

    It's pathetic how evasive the austerians are, once you put them on the spot. They really have a nerve, pontificating like they do, knowing they have nothing but evasive non-specific blather to offer when they're asked to explain their solutions.
    When you see the words "Mises" or "Hayek" in someone's post, just ask yourself: do I really want to ban paper money and go back to gold?

    You have to pity the kind of people who buy into conspiracy theories. I find the following to be the saddest words on the internet: "Re: connection between Bilderberg puppet lady gaga and viral outbreak in ukraine "

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    Politics.ie Member Amnesiac's Avatar
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    How about somebody looks up the definition of GDP, then tells me why it's a surprise that it falls when government spending is cut.

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    Quote Originally Posted by feargach View Post
    So, we take another fun jaunt on the circular argument merry-go-round.

    Once again, the austerian hordes are demanding that we cut, cut, cut. They repeat, ad nauseam the ever-reducing deficit figures, insisting that these figures demand we eliminate the deficit NOW!!1!!one!!

    They stay resolutely silent, of course, on the immediate consequences. There's a pretty obvious reason for this: Greece. They imposed heavy cuts and the entire economy shrank 20%. Very very stupid of the austerians to have demanded that, they now concede. If a Company X owes you money, you might demand that Company X starts cutting spending. But if the spending cuts cause Company X to lose 20% of its customers in a very short space of time, you'll call an end to the cuts if you have any desire to eventually get some of your money back. No company can survive long if it's losing 20% of its customers every few years. You don't get more milk by beating the cow to within an inch of her life. In fact you get less milk as it doesn't lactate as much while it heals.

    So I'm putting you on the spot now. Every austerian, tell me what you imagine will happen in the immediate aftermath of imposing €10bn of cuts. GDP will either rise of fall as a result.

    1: Will GDP go down immediately after the cuts? Yes/no question, please do not evade a clear answer.

    2: If GDP goes down, how far will it go down? At what figure, if any, will GDP cease to fall? Give a figure, please do not evade a clear answer.

    NB:In Greece it was 20%, and they only stabilised at that figure because they received a transfer from the Troika, meaning the Troika's Greek austerian plan was a total failure.

    3: Will GDP, at some point subsequent to the fall, start to rise again? Yes/no question, please do not evade a clear answer.

    4: If some kind of GDP growth does happen, from whence do you see the demand coming from to fuel this growth? Who's going to be buying the goods and services that makes this recovery happen?

    The majority of people that are championing austerity are not and will not be impacted by any of the cuts because these individuals are well off. If the 'austerity fans' get what they want, I reckon these individuals get some sick kick knowing they are considerably wealthier than the misfortunes who will feel the pain of Austerity.

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    Quote Originally Posted by feargach View Post
    You ought to be aware that the IMF (which is to say, the people who loan us money with the expectation of getting it paid back) are among the people who are opposed to more cuts.

    If you think we will be unable to repay, you really ought to explain why the IMF doesn't agree with your analysis.
    The devil can quote scripture etc.

    Various IMF officials have mixed the sweet with the sour. The IMF have demanded all kinds of cuts which you seem to reject, but a bit of PR from them and you're licking their arses.

    Pathetic.

    And as has been pointed out a zillion times how much austerity has there been when the government spent twice what it received in taxes for years? The very definition of a socialist paradise.

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