Monday, December 29, 2008

Simple Math From the Other Half

Every once in a while, it is interesting (scary?) to peek over and see how the other half thinks (well, hopefully it is not quite half).

Somehow, this post was recently stumbled upon. It defines seeing is believing, and other concepts such as the pot calling the kettle black ("idiot", "dolt", etc.).

Okay, there is some semblance of an intelligent point: There is hypocrisy in a Republican leader of the 2001-2006 era calling for spending restraint.

But from there it loses all semblance of rational thought. The post claims a simple formula for GDP: C+I+E+G = GDP. It is seemingly discernable from the text that a higher GDP is a desirable goal - an assumption that this site will always make. The post continues to cross off terms from the equation. To paraphrase: C(onsumption) is in the tank, I(nvestment) is weak, E(xports) are out. That leaves G. Thus, if GDP is to rise, the only way to do it is to increase G. If you do not want a depression, you must make G stand for ginormous.

If the teachers' union were really interested in increasing school funding, they need merely present the post to the taxpayers (this half). In all fairness, the simple math is correct, the logic (or lack thereof) is what boggles the mind.

G cannot be created out of thin air. Dollars added to G are taken from C and I. So what, pray tell, are those in control of G to do to increase GDP? Lower taxes and C + I will increase! Even if one thought that the change in G would be equal to the change in C + I (which empirically and logically it would not), which is preferred: a dollar of G, or a dollar of C + I???


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