This youtube hit has just passed a million views. It pretty much sums up the Keynesian/Austrian split.
It’s ejumicational.
A couple of related links:
Sophisticated Incompetence Is Britain’s New National Characteristic
What depresses me most about the British situation by comparison with the Greek is that, whereas the latter was brought about by good old-fashioned Levantine crookedness, which at least has the merit of charm, the former was brought about with a good admixture of Anglo-Saxon evangelical self-righteousness, which is quite without charm.
Moreover, in Britain there is a high level of ideological support among the intelligentsia for massive deficits. For example, twenty professors of economic history, some of them very eminent, wrote a letter on March 3 to the Guardian newspaper as follows:
We are economic historians concerned at the recent tone of the debate as to the scale and scope of British public sector debt. History shows, first, that British public debt is not high by the standards of the last 200 years. It is rather low in comparison to the second half of the 18th century, the first three-quarters of the 19th century, and most of the interwar and post-second world war era in the 20th century. It is also low in the context of the developed world; only Germany’s and Canada’s are lower among the larger industrialised powers.
This is exactly the same mental gymnastics going on here, used to justify spending more money that isn’t there.
Why is the Term Risk on Long Term US Debt So High?
It’s impossible to say which prevails, but it’s not unreasonable to assume that there’s at least some default risk pricing in. Our entitlement problem is about to open a gaping hole in the budget, and so far our solution is . . . to enact more entitlements. Unless our politicians start outlining some credible plans for getting our demography-driven disaster under control, bond markets would be perfectly rational to demand a discount that reflects a possible future fiscal crisis.
But our betters say DRINK!!!
Tags: US Economy
