Simon Johnson, Economist, formerly of the IMF (just on Rachel)

[nadinbrzezinski]

is also a know nothing economist who is just piling on the poor POTUS!!!!
:sarcasm:

Realize the IMF is not precisely a den of liberal economics, has not been for decades... so now we have a Keynseian (Krugman) and probably a Chicago boy, agreeing this is not a good idea.

I guess this will be defended even when people far more qualified than me, are telling you it ain't prudent at this time.

[pacalo]

1. It really does defy common sense. It can't be defended.

[nadinbrzezinski]

2. And sadly I know why the good professor was aghast

first thing the IMF does when it takes over a basket case (we are quickly heading there) is severely cut all spending accounts... like social services get slashed... and at times they even raise taxes.

Austerity packages are all but nice... (and we are officially basket case economy anyhow)

[truedelphi]

6. The IMF and World Bank are also very fond of taking out a nation's resources.

Often they will see to it that a nation is lent money, but that comes with strings. Sometimes those strings involve wholesale prices for national resources.

Right now, we are a serious debtor nation to China.
Huge TV expose on the other night about water rights. China now has freighters that pull twenty to fifty "bladders" along behind the mother ship. Each bladder is 2/3 or bigger in relation ship to the mother ship's size.

They are taking away the water of the Great Lakes.

And of course, the other way to do this is to simply buy up water utility inside the USA and sell us the water at inflated prices. Bechtel has already done this to people in Bolivia.

Of course, when the situation became untenable, the people took to the streets, and Bechtel was sent packing.

[BzaDem]

3. Krugman actually admitted that "no deal" would have resulted hundreds of thousands of jobs lost

http://krugman.blogs.nytimes.com/2010/12/07/the-deal/

"Well, for starters we have the two-year extension of the Bush tax cuts. As I pointed out yesterday, the CBO estimated that such an extension would reduce unemployment relative to what it would have been otherwise by 0.1 to 0.3 percentage points in 2011, twice that in 2012.

To this, the deal added $120 billion in a payroll tax cut; $56 billion in extended unemployment benefits; about $40 billion in extension of other tax credit. Also, expensing of business investment.

I’d discount the last item: we’re awash in excess capacity, and likely to stay that way for years, so I don’t expect business investment to be noticeably affected by tax breaks that give an incentive to move spending up in time. The rest is about $220 billion, or about 0.75 percent of GDP over the two-year period. What’s the multiplier on that? Pretty high on UI, which will get spent; less on the rest. Overall, probably less than 1. So let’s say that this raises GDP by 0.7 percent relative to otherwise; rule of thumb is that one point on GDP is half a point on unemployment, so add 0.35 points to the CBO numbers."

--snip--

Krugman's argument is the political consequences of taking the deal are not worth preventing the economic damage from "no deal." That is a political conclusion. He is NOT saying that "no deal" would not significantly hurt the economy.

[bullwinkle428]

4. MIT Professor of Economics? Pfffft! What the fuck does he know?

Do I really have to put :sarcasm: in this box?

[nadinbrzezinski]

5. It helps...

:hi: