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Nobel Prize Economist Says Don't Give Up...

Original post made by Perspective, Midtown, on Mar 21, 2009

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Interesting interview with Weekend Wall Street Journal with a 78 year old economist, Gary Becker, who won the Nobel Prize ( though I have to say this was before all prizes became completely politicized, so I am not sure he would win anything today).

Summarizes what he thinks led to the housing bubble and crash, various government solutions good and bad, government entitlement programs... I won't repeat them here. Better to read it yourself.

He seems to like some of what government is doing here...and not other actions.

A couple worries he has

"When you get a larger government, when you have the government taking over Social Security, government taking over health care and with further proposals now for the government to take over more activities, more entitlements, the rational response is to have less responsibility. You don't have to worry about things and plan on your own as much."

That suggests that there is a risk to the U.S. system with more people relying on entitlements. "Well, they become an interest group," Mr. Becker says. "The more you have dependence on the government, the stronger the interest group of people who want to maintain it. That's one reason why it is so hard to get any major reform in reducing government spending in Scandinavia and it is increasingly so in the United States. The government is spending -- at the federal, state and local level -- a third of GDP, and that share will go up now. The higher it is the more people who are directly or indirectly dependent on the government. I am worried about that. The basic theory of interest-group politics says that they will have more influence and their influence will be to try to maintain this, and it will be hard to go back."

Ending sentence

"Still, there remain many good reasons to continue the struggle against the current trend, Mr. Becker says. "When the market economy is compared to alternatives, nothing is better at raising productivity, reducing poverty, improving health and integrating the people of the world."

Comments from those who disagree with all or any part of it?

Comments (7)

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Posted by Perspective
a resident of Midtown
on Mar 21, 2009 at 8:33 am

I would like to add, concerning his ending sentence, that this is why France is finding it almost impossible to make the kinds of changes necessary to prevent its collapse...there are more people who are dependent on "government" than not, and have done NO planning for retirement, college payments, private health insurance etc. They have forgotten how to plan and care for themselves, and any changes, no matter how small, to trying to get them to be more independent scare them into a striking frenzy.

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Posted by Pesrpective
a resident of Midtown
on Mar 21, 2009 at 8:55 am

Congressional Budget Office says that we are heading for an almost 10 TRILLION dollar deficit over next 10 years, almost double what Obama projected, and 4 times what we were heading into under Bush ( which was still horrible). It is also the highest debt ratio since WW2...

Ok...when will this end? When we simply implode? When will we get REAL change, like living within our means? Don't most people understand that this is DEBT that MUST BE REPAYED OR WE AS A COUNTRY GO BANKRUPT, and what that means to anyone under the age of 80? ( Those older than this probably won't live to see the collapse).

Please, as much as you love Democrats, Obama, Reid, Pelosi, Boxer, Feinstein and Eshoo, start writing and protesting that you want what is good for America, not what feels good.

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Posted by Perspective
a resident of Midtown
on Mar 21, 2009 at 7:00 pm

No comments from those who disagree? Does that mean that everyone who has read it agrees?

I guess there is still hope for the nation.

By the way, I completely cracked up today. I read that ..was it Alec Baldwin??..sorry, don't remember..was all bent out of shape and threatening to go somewhere less expensive to film movies if NYC stops giving TAX BREAKS TO HOLLYWOOD TO RAISE CITY MONEY!!!!

HAHAHAHAAHAHAHA. I wonder if he understands what he has just learned about the effects of taxing a behavior? Do you think he and others in Hollywood are smart enough to connect a few dots here?

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Posted by Perspective
a resident of Midtown
on Mar 23, 2009 at 3:37 pm

Hmmm...I noticed that the NYT Three ( Dowd, Friedman, Freeman) dumped on Obama this weekend.

Wonder how that will affect "his" economic plans?

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Posted by Perspective
a resident of Midtown
on Mar 25, 2009 at 12:54 pm

Hard to not feel very discouraged when the reflex of every person in this Admin is to destroy capitalism, international relations with our friends, the Constitutional protection of States and individuals, our military and our security.

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Posted by Perspective
a resident of Midtown
on Mar 25, 2009 at 12:58 pm

Just ordered a book called "Liberty and Tyranny: A Conservative Manifesto" by Mark Levin, a Constitution Attorney.

Looks like it should be pretty good at explaining how we are giving up what makes us the most free, and richest, nation in the world.

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Posted by resident
a resident of Adobe-Meadow
on Mar 25, 2009 at 2:15 pm

Perspective, sadly, the only way America will final feel the sword of its own making is when the entire system is cleansed. This means total collapse of everything - the market and the dollar. Only then will Americans realize that laziness is no longer a valid means to survival.

Right now, Americans only feel entitlement. Americans only want more of the same debt that got us into trouble. Americans simply want that good life without paying for it. Just another shot please.

Dependency on one's neighbor for one's food is not wealth, but poverty. Only then will Americans become humble and more creative.

The naysayers who believe more debt is good for the economy will continue to defend Obama until it is too late for everyone. They will continue to beg for more debt as global interest rates will inevitably climb.

This is the last thing I will say because no amount of reason can convince the Obama supporters that spending $10 trillion of money we don't have will make life better. Good luck to you and thanks for the good discussions.

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