"Young people today will most likely become the first generation in US history not to surpass their parents' living standards."
I sat in on a talk that Frank Luntz was giving last night. Everyone else in the audience was 40+, well educated, all at the top of their fields. When Frank asked them how many thought their kids would have a better standard of living than they did, only 6 of the 120ish people in the room raised their hands. Frank's comment was, "If you're all in the top 1%, imagine how the rest of America feels right now."
This is correct if you consider "better standard of living" to mean "better standard of living relative to rest of the world". In terms of actual consumption and productivity, young people in America will have far richer lives then their parents, because the exponential increase in technology we see every day is creating wealth at a ridiculous pace. Our parents did not have iPods, cell phones, e-mail or social networks (facebook, hacker news). Try living without any of these for a day to see how "rich" your parents were at your age; who knows what will be around 20 years from now?
We take these things for granted and don't consider them "making us richer" because they are widely accessible, and people have a tendency to consider themselves rich only when they are richer then their neighbors.
Your point might be correct for the majority of the world's population but certainly not for the US...You don't think technology equals wealth, really? I'm surprised to find people who think that at HN. Think about how much would you pay for a sony walkman today vs. 20 yrs ago.
In that same vein, how can you calculate the cost of healthcare for technologies that did not exist 20 years ago? How do you compare the cost of a McMansion to the kinds of houses (tiny) that were being built 20 years ago? You can't. So instead people look at numbers they can calculate, and draw limited conclusions. It's a sort of selection bias based on what kinds of data we know how to work with.
Even if technology isn't equal to wealth, technology certainly drives down the costs of food, makes modern housing more comfortable and safe, and expands the number of ailments that are treatable by health care.
Read Michael Pollan's "In Defense of Food" for a more nuanced look at the relationship between "technology" and food. One of the reasons "food" is becoming cheaper is due to eliminating much of the nutrition and through ignoring the externalities of environmental costs.
The improvements in health care seem to be offset more and more by our poor food, sedentary lifestyles, and fractured relationships.
Maybe technology has made it cheaper to build a house, but that seems a wash as the dominant cost of housing is the property on which it is built.
In general, yes, technology improves our lives. But can not solve every problem in and of itself, and can exacerbate underlying problems if misused.
It is actually less likely that the children of the top 1% will have a better standard of living than their parents, than that the children of the middle or lower percentages will. The parents in the top 1% have a standard of living it would be hard for their children to top.
Disclaimer: Being a child of a parent in the top 1% certainly makes it more likely that one will also be in the top 1%. But even in good times, such a child falling out of the top 2 or 3% will experience a fall in living standards relative to their parents.
The question wasn't whether their kids would be in the top 1%, it was whether or not they'd have a better standard of living.
To the extent that having a good life comes from one's personal income, if the purchasing power of the dollar were increasing then they could easily buy more even if they were only in, say, the top 10%.
But most of what comprises standard of living isn't even determined by one's personal income, but rather by the resources, laws, customs, etc. of the community at large. And as it stands the wealth and health of society as a whole is dropping so fast that an individual can pretty much never keep up, no matter how much money they make or where they choose to live.
The population of the world keeps increasing. The supply of non-renewable resources keeps diminishing. Sooner or later, some generation is not going to live as well as its parents. It seems we decided to let that happen.
Living in a world without fossil fuel reserves, endless supply of fresh water, plastic, minerals, rare earths, etc. will be nothing like the 20th century. And that world is guaranteed. Those who anticipate what that world will look like have an opportunity to be ready for it. My hunch is that the steady-state of the world could at best look like, say, the Song Dynasty era.
This may not always be true. In rich countries, the problem seems to be avoiding population decline, not over population. As more people become wealthy, we might achieve some steady state of population.
There is still the problem, of course, of even a stable population exhausting non-renewable resources (fossil fuels, for example).
While interesting, some aspects of the article are misleading or meant to incite. For example, the section talking about student aid mentions the current administration's plan to increase student aid, but fails to mention the proposal of doing away with the bank subsidies completely and thus providing more aid instead of lining the pockets of bankers (http://www.whitehouse.gov/the_press_office/President-Obama-M...) contradicting the counter point to his argument.
I don't know. Perhaps. However, with the current economic conditions I would think that many that attend school under normal conditions might not be able to attend without aid.
I'm sure we can look at the numbers and come up with a conclusion. Furthermore, there are many city and state institutions that have tuition caps. In this situation I would expect more students to result in better use of existing resources or the creation of more city and state institutions.
I'm sure we can look at the numbers and come up with a conclusion.
A long, long time ago I read an article comparing the increase in the cost of college education vs. the published inflation rate. They were roughly the same. Really. But this was a long, long time ago...Camelot.
After student loans came into existence this rough equality disappeared and the cost of an education rose faster than inflation. Economically, that makes sense. Subsidize something (education) and you get more demand. With a somewhat inelastic supply of colleges, the price goes up.
Of course correlation is not causation. Many other reasons can be cited as well. But once upon a time college, while still expensive, only kept pace with inflation.
You can definitely start saving too early, in the sense that over a 16 year period you might be better off with a portfolio more aggressive than a savings account.
The subsidies to banks are incentives to loan. Fewer incentives seems likely to result in a fewer loans at higher prices.
If the price of education was set entirely by the market, the price of education would be equal to the expected reward - which would imply student payments so high they leave a graduate making little over the minimum wage for their entire lifetime. Even more, the student is more likely to overestimate their expected reward from education (everyone thinks their above average) than the bank is likely to underestimate it so some students today can wind-up with truly absurd debt loads (think of the people who drop out of medical school with no degree but owing $150K).
This situation provide such perverse incentives that it's in the interest of society to prevent it through lower-priced state education as well as private education subsidized by scholarships. During the 1950's, when America happen to be growing and productive, this was the paradigm. In the present era, the movement towards the marketization of education has only accelerated the country's decline. Why providing even more marketization now is "good thing" is beyond me.
Education and basic health care should be provided free to each citizen (to extent, forced on each individual) because they are a good, benefit for society as a whole rather than being merely a good for each individual. You benefit when everyone is healthy and smart (unless you're a con-man looking to outsmart your fellow citizen). The willingness of this society to go in the opposite direction has been a powerful force moving downwards.
Myself at 39, educated above but living below my parents standards. I'm not complaining since I'm very happy, but it is interesting that my generation is already experiencing this drop.
House prices and a competitive job market are the main forces keeping my standard of living lower.
Look at the big picture: the aging of the population means that the eldery must enslave the young, or they will have nothing to eat when they are old and infirm. Long-term savings is a fictitious concept - nothing we produce today will be of any use 40 years later so when you are old you will depend on the young to provide your food. When that happens you better have a way to compel them to part with fruits of their labor. Saddling the young with debt seems to be the current retirement plan for the old. It ain't just about bankers.
DenisM is talking about the principle that present consumption must come out of present production. Yeah, there are some things that are neither consumed nor depreciate quickly, like houses ... but who's going to pay grandma's property taxes? To repair or replace her furnace? Replace her hip? Etc.
Note that DenisM uses food as his example and try to find his meaning instead of the few exceptions.
present consumption must come out of present production
yes, that's the starting point of my argument, thank you for phrasing it clearly. The next step is that future demand for durable goods is not a good savings mechanism for a number of reasons:
1. The demand isn't large enough for a whole generation of people
2. Those goods have to be stored and maintained, which is
costly and eats into the savings
3. It may unpredictably lose value due to technological
innovation, and if you made a poor bet you will starve
when that happens
Therefore the premise of my argument is that the idea of long-term savings is fictitious.
Absent that there are only so many way to defuse the demographic bomb:
1. Saddle the young with debt by enticing them to spend beyond their means. Later they are compelled to pay via social norms and coercion of the state.
2. Collude on ownership of a crucial scarce resource such as land or oxygen. Collusion is likely to kill the economy very quickly though.
3. Make more babies. Costly in the short term, especially given that anyone who is making babies is also under the opression of debt, and the more babies the more crushing that debt is.
You're welcome; it's not my phrase, just something I picked up in discussions of this issue.
Although I should also mention "The Last Fool" concept. Those long-term savings won't be fictitious if you aren't the last fool left with them, i.e. you find another "fool" to sell them too.
But as you note that's a very iffy thing, certainly not something you should bank on, so to speak.
(Hmmm, you left out the Soilent Green option ... it's already being discussed by "serious thinkers". And there are less unpleasant ways to abrogate explicit and implicit promises to older generations.)
Suppose I am in my prime years. Should I help design the social system that opresses the young or the old? I will never be young again... and so the Soylent Green option is not workable! The young are pretty much doomed, the only question is as to the exact mechanism of oppression.
Alternative to debt burden would be oppressive taxes, but this has bad side-effects as well:
1. Taxes are not as discriminating against the young as situation dictates (debt is very discriminative)
2. People actually feel angry when money is taken from them via taxes. They are a lot less angry when they willfully spend themselves into debt. They even feel guilty when they can't pay. Bottom line is that it's easier to enforce because voluntary compliance is so much higher and political resistance to "pay your debt" is harder to imagine than to "pay high taxes".
3. Taxes depress economic development, while debt increases it (at the expense of the boom-bust volatility).
So I don't really see any realistic alternatives to the debt burden.
There is a very remote hope that technology brings us basic necessities too cheap to meter so that we don't have save for retirement. But that's really out there.
No argument with the above, except ... if you aren't paying into the fisc, you just might find that your posture is not so great. In Jerry Pournelle's CoDominion future history "Taxpayers" were in a class way above those who lived in "welfare islands".
I wouldn't assume our current political order survives this looming mess (heck, many including me argue it didn't survive the Civil War or FDR).
This is what the Australian government decided to do. $4000 per child, no questions asked. (subsequent governments have fiddled with this and pandered to their support base, but the concept still remains)
The treasurer came out with a phrase 'one for mum, one for dad, one for the country'.
It worked. Birth rates are now higher than they have ever been.
I'm normally against this type of government wastage. But it's not hard to see that the $4000 will be earnt back within a ~25 year period once the child becomes an adult and starts paying taxes, even when you take inflation and future value of the $4000 into account. The $4000 was being paid out of revenue at the time as the government had no debt. (subsequent governments have started to borrow again, being unable to be fiscally responsible more than a couple of years)
It's actually the smartest strategy of your three, because the old people need to have as many young taxpayers working as possible.
In the 50's, the marginal top income US tax rate was 90%, but the exemptions for dependents were very substantial.
However they weren't indexed for inflation so they became relatively trivial over time before Reagan got the Congress to index them. Perhaps a return to that tax policy is worth a try?
You can't just stash a building and cash it out 40 years later. You would have to maintain it for all that time and it's a huge liability. By the end of the day the building will be much worse than the ones being built at that time, really the only value of it will be the land is stands on. Any value in the building itself will come from recent renovations, not 40 yo investment. Thus the building is not a savings mechanism. The land may be, though.
Even then only if population continues to rise - if population drops as it does in almost all developed countries your land will be worth a lot less. Imagine a world where there are 1000 old people who can't work but own land, and then there are 100 young who can work and need a place to live. The first 100 buildings will sell/rent for some amount of food, the remaining 900 old people will die of starvation because there is nothing they can offer to the young in exchange for food.
Well, San Francisco had to contract out to Korea to fix the Bay Bridge, so it's quite possible that nothing we make in America will be worth anything in forty years. But there's quite a bit of useful forty year stuff.
A toll bridge, for starters, or at least a piece of one.
A valuable piece of land with a durable building on it (eg capital city)
A piece of a growing and profitable company (eg Google)
Royalties or income streams from work you create (see Elvis, Paul Mcartney, etc)
A piece of valuable farmland
A piece of valuable mine
A piece of a company you create and grow (see succesful startup)
A hunk of precious metal (eg gold, silver - they've been valuable for, say, 5,000 years or so)
Not:
cash
speculative stocks
bubble inflated real estate suitable for a shrinking demographic
managed investments
consumer junk
Young people today will most likely become the first generation in US history not to surpass their parents' living standards.
I've seen this phrase, in various versions, in lots of places over the past few months. Is this a new proposition, or was the idea floated (incorrectly) during the Great Depression or the 1970s oil crisis/stagflation downturn?
This is a new idea. The current generation is the first generation that everybody thinks will not do as well as the preceding one.
During all of the economic problems of the past, polls consistently shown that people, as bad as things were, expected their kids to have a better financial life than their own. This is no longer true.
Note that the data is different depending on whether you ask "will children do as well as their parents?" or "will your children do as well as their parents?"
I just don't get libertarians. They're great at pointing out problems but never seem to offer realistic solutions. No doubt most of these issues he raises are valid concerns however what's the alternative? The free market will magically fix everything? We know from the Great Depression and in more recent times the free market is only concerned about maximizing profits for themselves. The government may not be supremely efficient at running some of these things but at least we have a say in the process. Most of the issues he cites exist because the free market failed people in the past and there was public outrage over a government that allowed it to happen.
I just don't get libertarians. They're great at pointing out problems but never seem to offer realistic solutions.
I think the default libertarian solution is "don't do anything, the problem will take care of itself", which in point of fact often is a better idea than the hodge-podge, incoherent "solutions" that actually get adopted.
On the other hand, perhaps you're asserting that "do nothing" isn't a realistic solution in the sense of being politically impossible to implement; in which case you'd be completely correct, which is why libertarianism remains a fringe political position for naive idealists (along with many other philosophies that could plausibly work better than the status quo).
Most of the issues he cites exist because the free market failed people in the past and there was public outrage over a government that allowed it to happen.
...to be fair, most problems caused by the market arise because of perverse incentives and government meddling that allow profiteering looters to exploit the system at everyone else's expense. The counterintuitive part is that reducing regulation is roughly as likely to "create" these problems as solve them, because in a semi-stable equilibrium removing one distortion may open a new opportunity to abuse an existing one.
The energy crisis in California is an excellent example of such, where making a (stable, inefficient, heavily regulated) market more free created exploitable distortions that allowed a bunch of (unprintable) people to screw everything up.
I just don't get safety freaks. They're great at pointing out dangers, but never seem to offer realistic solutions. No doubt many of the activities they criticize are harmful, but what's the alternative? Not hitting ourselves with hammers and not walking barefoot on rusty metal and hoping that our bodies will somehow magically avoid trauma and tetanus?
Seriously - in the real world, a perfectly valid way to solve a problem is to stop doing the thing that causes it. Why the defensiveness because a libertarian pointed this out?
The author complains about Medicare, Social Security, student loans, and the War on Drugs. Whether or not you agree with those programs, do you think it's practical to just stop them? While I agree with many libertarian sentiments, I rarely find a libertarian argument that even attempts to explain a transition process.
A better question might be "Do you really think it's practical to continue them?", but to answer you: yes.
As for transition processes, to be blunt, many random libertarians online don't bother discussing them because they know it will probably never come to that. If you want good discussion of such things, places like the Mises Institute and Cato.org (full of policy wonks) would be good starting points.
For instance, I don't think that continuing the War on Drugs is practical. But I recognize that ending it is a gradual process, not an overnight one. It's entirely impractical in many regards (economic, social, political) to just stop the War on Drugs overnight. In my opinion, people who are going to complain about something should offer some practical alternative.
Ah, so you completely ignored my post beyond that question. Fair enough, I'll return the favor:
"people who are going to complain about something should offer some practical alternative"
Meh. When the overwhelming majority of the public does not believe that things like the war on drugs are destructive programs that should be stopped, why waste time on trying to satisfy the rare person who says he already agrees, but demands we all have a presentation on a detailed decriminalization/legalization scheme decades before it's even worth talking about?
I don't advocate having a detailed decriminalization scheme, but an overview or outline would be nice. To that end, I think identifying clear steps, as opposed to a strictly ideological argument, is a good way to convince the overwhelming majority that the change is necessary and good.
But of all those examples, the War on Drugs is probably the easiest to "just stop," so to speak. Putting an end to Social Security overnight means that grandparents around the country won't have any source of income. That's a good example of where just ending a program overnight seems impractical to me.
To address your previous point, I have spent some time on Mises before, not as much Cato. But not enough time on either to really comment about specifics on their proposals or lack thereof. I suspect the reasoning you presented is probably accurate, at least in some part.
"I think identifying clear steps, as opposed to a strictly ideological argument, is a good way to convince the overwhelming majority that the change is necessary and good."
Not sure where anyone made any "pure ideological arguments", especially since this is a thread off a very consequentialist blog post...but no, having a plan doesn't convince people that action is necessary or desirable.
Plans are what you discuss after people generally agree that change must happen; the public at large doesn't want most changes libertarians are interested in, so trying to sell them on how to carry out those changes is hugely premature.
It's simply shifting the problem. End Social Security? Great we solve the money problem. New problem: Lots of old people are going to die. Pase it out slowly? New problem: Lots of voters support Social Security and want to see it continue in some form. So obviously the solution is somewhere in the middle and there are no easy, ideologically pure, answers.
Good article, as usual for mises.org (I credit their material a few years ago for motivating me to get out of the stock market).
I am in my 50s, and one of my common little rants is how selfish my generation and the next older generation is. My children and my young grandchildren will indeed have to pay for our collective excesses. Really unfair.
I believe that it is human nature to care for younger generations, so the current wave of selfishness is really sick and unnatural behavior. Two generations of gluttons.
This selfishness is on personal, corporate, and government levels. The worst is starting unnecessary wars on credit, but the general blame trickles on down.
You generation is screwed, too. Social security net revenue went negative this year. You'll never see a dime. Medicare will also be bankrupt much sooner than anyone thinks.
Only the "next older generation" has made out on these ponzi schemes.
You are right about the next older generation getting even a better deal, but I am not complaining on my own account: when I graduated from college in the 1970s, it was really easy to buy a home, and generally have had an easy life style.
I have to admit to a bit of a morbid fascination about the economy: I expect that in the USA that local governments will go bankrupt, the federal government will devalue the dollar to get by, etc. Thing that I have no idea about: will this happen in 1 year, 10 years? ...
I'd add one more bit, though: it's not between youth and old; it's between risk takers and risk avoiders.
The last thing the majority dreams about is risk. So the gov takes care and tries to minimize the risk. The minimum wage, enormous benefits for not very innovative public workers, interest rates' manipulation etc.
Of course, if you minimize the risk you also minimize the social mobility. It's hard to get a reward, without risk.
Oddly enough, the post-WWII generation did much better than the present generation without being notable for risk taking.
I mean, declining education levels, deteriorating infrastructure, and many other causes might be pointed to for the decline of America. Considering that, as you say, only a minority is ever going to risk-inclined, the decline of America can't be chalked up to risk-aversion.
And also, when the health care system declines, the risk of catastrophic becomes something that an individual isn't very capable of managing.
That's not a very telling point, since we were the industrial nation least trashed by WWI, and were considerably strengthened by how the war compressed say half a century's worth of technological progress into a half a decade.
For example so very many things came out of RADAR R&D ... *including microwave ovens :-), but also stuff that fed into the Whirlwind computer project (the first practical computer), etc. etc.
I think I'm going to start redirecting a portion of my savings to some sort of a basket of foreign currencies.
If in 10 or 20 years, we don't clean up our act and a huge part of my taxes are just servicing debt, I'll just move somewhere else. I don't even care if the taxes are higher in another country; so long as I get good value for my taxes paid.
thanks for the article, but it has right the opposite direction than what is complained about here in Germany.
we complain about the newly introduced Bachelor/Masters system here. We complain, students will now have less time to study and think about the problems. Also having to pay more money than before, we say that less people will go to universities, thus lowering education standards.
Agreed. I read "Laws dictating the minimum wage and regulating child labor play a significant role in preventing young people from finding jobs" and rolled my eyes a little.
OK, so tell me why we don't have movie ushers anymore.
Price controls always produce shortages; in this case, there's a whole bunch of jobs companies just can't afford to hire people to do any more because the total cost of labor is higher than the return. Is this so hard to understand?
Is it a moral position to tell an unemployed youth that if they can't get a job at $X wage there's better off without one? Have you looked a youth unemployment rates, especially recently?
Well, first of all, you're using the phrase "youth employment," which I think is reasonable and fairly normal. The author used the phrase "child labor," which I rolled my eyes at because the author is seemingly oblivious to the negative connotation of that phrase.
Second, I'm not even necessarily in favor of a minimum wage. I just think it's bogus to blame our current economic woes on the existence of minimum wage. It's a bogeyman that the right attacks at every opportunity, whether it makes sense or not.
Edit: Also, you haven't provided any evidence supporting the claim that we don't have movie ushers because of minimum wage or labor laws. You've just provided ideological conjecture and arbitrarily placed the burden of proof on me.
Right, it's legally "child labor." But would you use that phrase in normal conversation as though it doesn't have an uncomfortable, negative connotation?
If I were referring to child labor laws in a blog post, as he was, probably. If I come up with some weasel words for them, anyone paying attention will pounce on that, suspecting my "real" agenda is to put orphans dressed in rags on treadmills.
This is kind of my point. I rolled my eyes when the author complained about "Laws... regulating child labor." You said, "child labor laws," which I would argue has a significantly different meaning than the authors phrase. But I'm comfortably agreeing to disagree on the connotation.
Perhaps I would have understood the author's point more had he even bothered to explain what laws regulating child labor he was talking about and why they're a problem. Instead, he just skipped that and focused on minimum wage.
the article says that accepting a low wage will make you independent. I wouldn't conclude like that. Working with low wages will seldomly enable to get a better standard.
If you aren't a top performer, you'd have to live forever with those wages. One job is be enough for a living.
Another one of those conservative anti-deficit articles that would have been very timely if it appeared before the war started, but of course it appears after the war and the incredible amount of money it is costing us.
Why did I never hear conservatives decrying deficit spending during the Bush years, when deficit spending ballooned. No, then you had conservatives talking about how the deficit does not really matter.
Now it is too late, the cat is out of the bag. We need deficit spending just to keep the damn economy from collapsing, and no politician will have the guts to just exit the wars.
I don't see this as Conservative as much as it's Libertarian (See the anti-War on Drugs part for example). From that stand point Libertarians have always been vehemently against not only the war in Iraq (http://www.thegreenpapers.com/Vox/?20030310-0) but in many cases the one in Afghanistan as well (http://libertarians4peace.net/). Libertarians in general are non-interventionist in regards to foreign policy.
Libertarians have always been vehemently against not only the war in Iraq ...
Certainly not all of them though. ESR is the prototypical Libertarian in my mind, and has written about how awesome he thinks the Iraq was is/was (for example: http://esr.ibiblio.org/?p=651).
You might pick a more representative prototype. Even someone as iffy as Ron Paul makes more sense.
But yes, like every single other political group outside of pacifists, you could find pro-Iraq libertarians. However, the huge majority of libertarians were vehemently against the war in Iraq. Many of them balked at the war in Afghanistan.
(Also, a footnote: Libertarians are members of the Libertarian Party, libertarians are people who have libertarian views.)
Note: I'm a registered independent and little "l" libertarian.
I supported the use of force in Iraq and Afghanistan based on utilitarian principles -- I felt (and still feel) that less people will die and less pain would be inflicted by the use of violence in those areas) I find that the careful and appropriate use of force by the state does not conflict with my libertarian views.
There is no such "vast majority of independents who have strong libertarian leanings" outside of LP propaganda, just a small fraction of "independents" who don't want to admit they consistently vote for one party or the other.
(Oh, yes, and a tiny, tiny fraction of libertarians, some minority of whom care about the LP.)
Really? Last I checked both major parties in the states heavily competed for about 20% of the electorate who self-identified as independents.
Can't comment much on "fake" libertarians, though. I haven't seen much evidence that they either vote the same way each time or not. It might be that different candidates draw out different groups of these middle-grounders.
I'm not much on big-L libertarianism, mainly because so many of them are all over the board on policies, usually taking the core ideas beyond where they are practical. Libertarianism is best practiced when it has a healthy respect for the social contract, such as the use of national force on occasion.
As for "fake libertarians", I really don't know whether you are or not, and I'm not highly concerned - though many of your lines are reminiscent of the typical Team Red "if you guys were just a little closer to our ideas, you'd do such much better" shtick.
The simple truth is that actual, consistent libertarians predominantly opposed the war. I'm no more interested in historical revisionism on that point than I am in revisionism on the war itself.
Nice link. True, but perhaps a little overstated. Independents are who they are -- if they routinely vote one way or the other I'm not sure that takes away from their self-identified independent status. Seems like splitting hairs to me.
I'm not interested in revisionism either, and looks like you've failed to make any kind of point at all here. I was simply providing another piece of anecdotal data for your discussion -- which I've done.
The Institute characterizes itself as libertarian and expresses antiwar and non-interventionist positions on American foreign policy, asserting that war is a violation of rights to life, liberty, and property, with destructive effects on the market economy, and tends to increase the power of government.
If by conservatives you mean libertarians (Austrian economists tend to be libertarian), you only have check out Peter Schiff or do a search on mises.org to hear the "decrying of deficit spending".
Also, you may want to check out some more articles on mises.org to fully understand what deficit spending does to the economy.
> Why did I never hear conservatives decrying deficit spending during the Bush years, when deficit spending ballooned. No, then you had conservatives talking about how the deficit does not really matter.
The Mises institute (as others have rightly pointed out) is not conservative, but libertarian. Fiscal conservatism and libertarianism are similar, but there is a distinction.
The Mises institute has been talking about deficit spending for well over 50 years now, regardless of who has been in power. If you haven't read Mises' Human Action (c. 1940) which deals extensively with this, I would recommend you to do so.
Please investigate a bit about what you're saying before you try to write off a writer as "well the cat's out of the bag now".
Don't you find it telling that critics of Mises and Austrian economics rely on ad hominem (personal attacks), appeal to the majority, and appeal to authority as their main argument forms - all of which are fallacious?
Considering that the track record of mainstream economist predictions about the economy are horrid (just try trading their predictions), we should consider plausible, alternative points of view.
It says they both disagree with the Austrian school's version of business cycle theory. Even the quoted writer goes nowhere near the dismissal of the Austrian school attempted in the MoJo piece.
I'm reminded of when you see someone cite a creationist and one evolutionary biologist's disagreement with another on some detail of evolutionary mechanisms in order to argue for Intelligent Design.
I sat in on a talk that Frank Luntz was giving last night. Everyone else in the audience was 40+, well educated, all at the top of their fields. When Frank asked them how many thought their kids would have a better standard of living than they did, only 6 of the 120ish people in the room raised their hands. Frank's comment was, "If you're all in the top 1%, imagine how the rest of America feels right now."