Laffer is to economics what Lamarck is to biology.

He deserves to end his days screeching "HEIL REAGAN!" and "The Democrats will hang you one day!" like some latter-day GOP-branded Julius Streicher.

Your video, Arthur Laffer, Economist to the Rich and Republican, has made it into the Top 15 New Videos listing. Congratulations on your achievement. For your contribution you have been awarded 1 Power Point.

@chilaxe
Your source is "by the well-known Reagan economist Arthur B. Laffer, the Wall Street Journal’s Steve Moore, and Jonathan Williams of ALEC." I couldn't figure out which way ALEC leans in a 2-minute search, but the first two authors are almost certainly biased towards the right. Everything they say may be informationally accurate, and it might even be a fair all-around representation of the situation, but I wouldn't go quoting it as a neutral unbiased source any more than if Hilary Clinton co-wrote a similar book with someone from MSNBC.

Cenk's mistakes aren't "the same kind." The mistakes the Fox dudes are making are patently false and misleading. Cenk's "mistake" was talking about two things with the same name. I put mistake in quotes this time because I watched the video again, and he says, "the 99%", which is the slogan of the protest movement, so it's not even wrong. He didn't say, "99% of the population". Your argument that it's a lie is like saying that members of the Tea Party weren't actually in attendance at the Boston Tea Party in 1773. I think anyone listening would understand that both he and the Fox guys mean the protesters. The Fox guys might not even disagree with how he said it.

Is there anything else you can point to of Cenk's that is a clear falsehood, especially one that he continues to repeat? While I like having heroes, I prefer it when their armour is a little tarnished, so you'd be doing me a favour.

Sorry NetRunner, but Schiff is a brilliant libertarian and Keynesian economics is junk science. Krugman's belief that deficit spending is a solution, that we can administer new shots of heroine in perpetuity to avoid withdrawals, is the same as Madoff saying his scheme would never end at its height. It only lasts for as long as you can find new and larger investments. The Fed cannot control long-term interest rates, they can only price fix in the short term in exchange for higher long-term rates. His forecast of perma deflation is pure crap, that would require the Federal Reserve to raise rates higher than Volcker did in a far more dire situation than we were in then. No longer is the majority of our debt financed long-term or domestically. It's majority owned by foreigners in T-bills. There is no exit strategy for the money being pumped in today. This is going to turn into a currency crisis when the debt is monetized and productive foreigners refuse to keep throwing good money after bad into our bond market. "Free Lunch" guys like Krugman who put the cart before the horse, consumption before production, just don't get it in the endgame.

Mish's criticisms are even more laughable. Schiff is a long-term investor, not a trader like Mish. The dollar headfake in the last year where people ran toward the blast initially is not a sustainable trend and totally meaningless. When you know the Titanic is going to sink, you don't stick around because you think you can get one last dance in, and that seems to be what Mish thinks people should do. Decoupling is going to happen whether Mish likes it or not. Our treasury secretary is getting laughed at by Asian students when he tries to reassure them of dollar integrity.

(1) From the creditor's perspective, there's no point in loaning money to someone to consume your production. You don't devalue your currency to export for the sake of exporting, you export for imports or keep your currency strong so that you can consume your own production. Otherwise, you're exchanging products for stashes of paper IOUs that we show no intention of replacing with real products. When the Asian countries figure out how easy it would be to consume their own products, our economy is toast. The only problem for someone like a China is how to head for the exit without causing a stampede. The minute such a large holder of dollars starts spending them, their value relative to goods will diminish substantially. Avoiding a hit now is going to be impossible, but they know that continuing to accumulate dollars is simply creating a larger future hit.
(2) From our perspective, politicians will always do what is expedient in the short-term. Telling the truth and saying you have to cut spending and entitlements by massive amounts for the sake of future generations isn't politically profitable. Not just because of all the people expecting things like unlimited health care regardless of our productive capacity to finance it, but because such a high percentage of our voting population now have overpaid government positions that they don't want to lose. Someone like a Ron Paul tells the truth at the expense of having an chance of winning. Winning requires that you be a candyman.

Savings is underconsumption and required for loans to exist. Ideally, people borrow that finite capital to increase productive capacity, to turn a shovel into a bulldozer and pay the loan off with more production. That is the kind of borrowing that benefits the creditor, the debtor, and society. It's not supposed to be a tool for consumption and winning elections, and that's where this country derailed from the sustainable and healthy growth it had in the 19th century. Whatever "success" we had from things like Medicare and Social Security came at an equal or greater long term cost. It's generational theft in its purest form, borrow to consume in the present to leave each successive generation with a higher and higher interest burden that will have to be paid for with higher taxes or currency devaluation. I say this because it is the fundamental oversight of people like Steve Forbes and Art Laffer who try to cast off trade deficits as "meaningless because it's something we've always had" in debating the resiliency of the bond market without distinguishing how we spent our loans then vs now.

Defaulting on our debt through inflation is a certainty. If you listen to Financial Sense or Schiff's weekly radio show, you'll learn how obvious that conclusion is very quickly.

http://www.youtube.com/watch?v=JGdj3Gx4A8w
http://www.youtube.com/watch?v=EgMclXX5msc

ROFLMAO

Center for Freedom and Prosperity Foundation is a shill group for off shore financial tax shelters.

The Laffer curve was laughed at by most economists when it was presented in 1981. It doesn't for example apply to highly taxed societies in Scandinavia which still manage to have high productivity rates.

Keynesian economics stipulates an inducement of investment, in 2 key ways that is always glossed over by such critics it is the reduction in INTEREST RATES and the government expenditure in INFRASTRUCTURE. It hasn't been used in this form for decades.

However it is common to lump in all government expenditure as a form of Keynesian economics, because then you can create stupid videos like this.

When I was in college at USC, I worked at the Business School as a proofreader/editor. I edited some things of Laffer's (I, a nineteen-year-old English major editing the "writings" of a full profesor in the Biz School; still makes me laugh). The man wrote as though he was typing with mittens on. I concluded then that he couldn't quite think straight.

Laffer...what an appropriate name. Hopefully people like these retarded laughing hyenas have/will rid us of their troublesome existence.

I'm calling *wtf because it's almost hard to believe wtf I just saw.

isn't it lack of government oversight that got us into this mess in the first place???

Were the riots of the 60s a result of government failing to enforce Jim Crow laws? Rather than put law enforcement under a single umbrella, you need to understand the difference between a good law and a bad law. Before you even make the jump to regulation, ask yourself if the regulators are being regulated by the constitution? Nope. Sort that one out first, there's your problem. "Regulation" is an extremely general term used by politicians to great effect to blame others for problems and changes in market behavior that they create. We have a central bank in this country that price fixes interest rates since 1913. This is a socialist idea that was passed on the basis of its objective rather than its result. It turns out that letting a pseudo-government agency set interest rates results in an artificial lowering to delay politically inconvenient recessions. This artificial price fix results in the wrong kind of investment decisions and incentives, leading to phony bubbles that carry with them the seeds of their own destruction. I'll explain below.

In order for credit to exist, savings must exist. That's what credit is, someone else loaning their money out to someone at interest rather than spending it. Everyone wants a low rate of interest as a borrower. Everyone wants a high rate of interest as a saver. By definition, savings is underconsumption. Someone, somewhere, has to be saving rather than spending money in order for real credit to exist. These two forces are at odds with each other, to find the happiest medium between savings and production. That's completely perverted by a price fixing system where the government is dictating the interest rate for political purposes. Too easy dictation in the 90s caused the tech stock bubble, worthless tech stocks were trading at hundreds time earnings. When that "growth" came crashing down in 2000, Bush didn't want to have the recession occurring under his first term or he wouldn't get re-elected. So he and Greenspan lowered interest rates to 1% for a whole year to keep businesses borrowing and consumers consuming. The problem is, where is the savings coming from to allow both to happen at once? Overseas. We are the world's largest debtor nation now, borrowing from everyone to consume products that they make. They accumulate our paper money. We get their products. 70 billion a month trade deficit and still going. That's our economy the last twenty years. We abuse a reserve currency of the world status gained under the gold standard to export our now inflationary currency all over the world. That's coming to and end at some point. The Fed is increasing its balance sheet like there's no tomorrow, trying to replace the credit no longer being loaned to us with a printing press. It won't work. It didn't work in Weimar, it didn't work in Argentina, it didn't work in Zimbabwe, and it won't work here. The inflation is in the pipeline, it will hit during Obama's term. Obama and McCain are both socialists, the pork filled bailout bill they voted on ought to be evidence of that. Neither one understands that the recession needs to happen like the druggie needs withdrawal, and the more you try to stop the failures and painful reallocations with more drugs, the longer you're going to be in rehab.

So where did all that money from tech stocks filter into? With such low rates of interest and a removal of houses from the government's own inflation calculations, inflation shifted from tech stocks into real estate rather than being purged in a recession. So nobody but a few libertarian economists who learned a type of economics that isn't taught here could see the problem, one of them being Ron Paul's economic advisor Peter Schiff. In that mania, lending standards were abandoned to take advantage of the artificial demand created by the dictated low interest.

In other words, the market got drunk, but it was the FED THAT SPIKED THE PUNCHBOWL.

http://www.youtube.com/watch?v=LfascZSTU4o

http://www.youtube.com/watch?v=ucDkoqwflF4

You can see the austrian view (Schiff) directly in conflict with the pro-government keynesian/monetarist view that is predominantly taught in this country (Laffer/Swonk). That's why none of the so-called "harvard educated, brilliant, phd holding" managers of a these banks and investment firms were not only oblivious to what was going to happen, but regularly confuse weaknesses for strengths. It's that ass-backwards, we teach the economic equivalent of astrology. Why? Because who has the most to gain from a sexy interventionist theory that says inflation is necessary to prevent hoarding and politicians spending its citizens' money for them can stimulate economic growth? Why, it's the benefactors of inflation!

I'll address Necrodancer later, I gotta go. He seems awfully confused on what socialism is and how socialist we are.

This was all in my economics 101. Laffer obviously didn't take that class.

He's right about women in the workforce. Most would rather not work as much as they do. I don't blame them.

Yeah Laffer, he's way off base!

It's absolutely amazing how oblivious those people are to what he's saying. He kept his cool quite well.