Guest Post: Top 10 Keynesian Ways To Boost The US Economy

Tyler Durden's picture

Submitted by Jason Kaspar of Goldshark

Top 10 Keynesian Ways to Boost the US Economy

Keynesian economists are propagandizing the media with
a unified message; in one breath lightly touching on the human tragedy
in Japan, while in the next anticipating with delight the economic
recovery it will (supposedly) create. The natural disaster in Japan is
tragic both on a human level and economically. Japan may,
possibly, enjoy a GDP boost in six months or so as a result of some
rebuilding, but the billions in present-day lost productivity will
easily negate any future upside.

The buildings and businesses with billions in loans have (and will
continue to) experience enormous losses. Who will realize these losses? 
Insurance losses – the capital that would be invested in other
productive assets - now must cover billions in claims.  And what about
the economic impact resulting from the loss of nuclear efficiency?
Consider the power situation in Japan over the coming months with 40% of electricity
used in greater Tokyo historically originating from the Niigata and
Fukushima prefectures.  In totality, it is mystifying how any economist
could predict a net economic positive.

But, then again, here come the Keynesians. Perhaps no statement has been more shocking than Larry Kudlow’s callous gem
(he later apologized): "The human toll here looks to be much worse than
the economic toll and we can be grateful for that . . . all these
markets stocks, commodities, oil, gold, there is no major breakout or
breakdown. I have to view that positively." Kudlow's comment may have
been a slip up, but it is one example of many.

There’s Mohammed El-Erian writing in the Financial Times:

“Attention also turns towards the extent of the damage to
the economy and its reconstruction and rehabilitation plans . . .
Japan’s economic growth rate will fall in the immediate aftermath of the
natural disasters before rising sharply due to reconstruction
activities . . . Moreover, in a really good recovery scenario, Friday’s
dreadful shock could even be a catalyst for internal political unity and
for overcoming what has been two disappointing decades of economic

Not to be outdone, Goldman Sachs recently issued a report touting the likelihood of a Japanese recovery.

Let’s follow the Keynesian approach. I have come up with
the top ten ways we can boost the US economy using that same Keynesian

1. Air Force Bombing Practice

For an entire day the Air Force can carpet bomb our
interstates and highways. Why should Libya get the economic boost? Roads
will be off limits to avoid human casualties (building up productivity
for the lost work, right?) and we can kickstart the construction sector
still reeling from the housing and commercial real estate nightmare.

2. National Food Fight

Let’s take it back to the college caf and have a food
fight. Our processed food tastes terrible anyway. Rules are: any and all
food may be thrown at other Americans, but under no circumstances may
food be preserved. Think of the fun. Sure, our hybrid, pinkish,
crossbred, Monsantified tomatoes aren’t quite as messy as they used to
be, but boy do they hurt more. Anyway, this is America. We have drugs
for that.

3. Public School Fire Day

Every kid wants to burn down his school, right?  (Ok, ok,
besides the homeschoolers.) Well, Keynesian Public School Burning Day is
their chance. It can be a teaching experience for Keynesian economics.
We can invite George W. Bush, so that no child is left behind.

4. Little Rascals Day

We'll give American children a bucket of baseballs and
eight hours to break as many windows as possible - a national event with
no spankings, groundings, or consequences. Let them loose on cars,
houses, whatever. Think of all the fun in the neighborhoods.  Red
houses, blue houses, yellow houses. They could start with the White

5. Political Car Bashing Event

We'll have all senators and state representatives bring
the cars in their household to Washington, where individuals can take
free swings with a baseball bat. Call’em Porsche piñatas. With 100
senators and 435 state representatives, you’d have 1600 vehicles at a
minimum. Besides economic stimulus, the electorate could let off some
steam. It would be better than cash for clunkers – it would be the bash
for flunkers.

6. Skyscraper Demolition

We could just take down the country the old-fashioned way, with a Marlboro and thermite.

7. Cut It Up

Afraid of cutting up credit cards, we can unleash the
fiscally irresponsible on the lackluster retail sector and have them cut
up, chop up, and rip up poor quality Chinese-made clothing that
typically bleeds after one washing anyway. (This plan would actually be a
good idea if all of the clothes manufactured for American Don Juans
weren’t irrevocably produced in Dongguan).

8. The E-Party

We can develop a clay pigeon iphone app and finally give
the gun-totin’ Palin-lovin’ domestic militiamen something to shoot at.
We can call it the E-Party against smartphones. Actually -- this may not
work. Doubtful the drug companies need more stimulus.

9. Bumper Planes

This one might not work either. I was thinking we could
have some destructive fun on the tarmac with Boeings and Airbusses (ya
know, to help boost the economy), but getting through security screeners
would be a radiation hazard, and getting a rubdown from an agent would
be worse.

10. Control-Alt-Delete Day

Now here’s one that will definitely boost the economy. We
can dump the computers of air-head economists into a pool of highly
fluoridated toxic tap water. Biggest splash wins!  Let's begin with Paul

In all seriousness, how can any economist interpret the
tsunami disaster as economically positive without logically supporting
the controlled demolition of the United States? How would the results
not equate? This is the irrationality of Keynesian models. Regardless of
debt levels, inflation levels, natural disasters, inventory gluts, etc.
the answer to economic problems always culminates in further spending.

There can be positives and negatives to spending. During
the Reagan years, the economy was not over leveraged, so spending
created a net positive for growth. But when the economy is over
leveraged (including governments) like it is today, and like it is in
Japan, both destruction and spending can be catastrophic.  When inflation accelerates, further spending becomes the problem and not the solution.

Many economists would laugh off my attempt at sarcasm with
the top ten listed above, but inwardly their economic theories serve to
justify such irrational policies, only they couch their theories under
academic names.  Debt spending can work for awhile….but it cannot work

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youALREADYknow's picture

"The buildings and businesses with billions in loans have (and will continue to) experience enormous losses. Who will realize these losses?"

Why the answer is so obvious. The PUBLIC will realize these losses. Thus has been the policy for the last 3 years as private losses are transferred to the public balance sheet.

EscapeKey's picture

That was the entire point behind the construction of the Federal Reserve. Never again did the founding banks have to accept responsibility for poor investments.

And it's brilliant, too, because if they weren't at liberty to simply print, they would have to increase taxation, which even the most docile, x-factor watching, pizza delivery eating J6P would notice. But money printing, leading to inflation? Nah, they'll just spread confusion around, claming the inflation is due to the entirely new concept of snow falling in January.

Azannoth's picture

Hey let's use a Nuke or HAARP to set of

creating a mega-tsunami on the American Atlanic coast, and bask in the 200% GDP surge !

caconhma's picture

ZeroHedge appears to be a propaganda tool.

It is disgusting when ZH readers cannot express their approvals of high quality replies of its readers and participants.

John Law Lives's picture

When will the giant R-E-S-E-T button get pressed?

RingToneDeaf's picture

11. Get rid of this crop of politicians, grow some new ones that serve the people.

Temporalist's picture

You're not just ringtone deaf you're satire/sarcasm oblivious.


How about...

11.  Elect more politicians to spend billions on projects that are ultimately abandoned due to lack of funding.


12. The 44 million on food stamps get cuts of Kobe beef at $40/oz.

FOC 1183's picture

Paging Dr. Krugman

Paul Krugman's picture

I'm here I'm here. What do you need. I can tell Ben to print some money if you would like.

Paul Krugman's picture

Well you know I am really busy convincing the world that $1.6 T deficits are a good thing. Its really hard work. Do you know how many bullshit papers I have to write, and all the acceptance speeches for awards take a long time to write.

FOC 1183's picture

Not to mention that whole "Conscience of a Moron" blog thingy :>

Paul Krugman's picture

Yea but that doesn't take much time. Its just delusional ramblings, and attacking straw men that I conjure up for the purpose of satisfying my own stupidity.

Temporalist's picture

I think Krugman's main problem is his fear of impotence and irrelevance.  He can't handle not having an impact and being ignored because he's such a colossal douche.

EscapeKey's picture

You mean "I can press the red button"?

oogs66's picture

Air force bombing practice?  why not have people on the road?  think of the job creation.  asides from having to replace people who are killed or wounded, hospitals will have to staff up as well.  and the unemployment rate would come down as the workforce is reduced

yeah, yeah, tragic loss of life, but think about the good for the survivors

Pants McPants's picture

Hey WWII solved the unemployment might be on to something here....

greyghost's picture

thanks for the laughs...i needed that!

Mercury's picture

The obvious solution here is to just declare war on ourselves.

By executive fiat of course. Having Congress do it is sooo old fashioned.

Battleaxe's picture

Yeah, the rich could declare war on the working class!

Mercury's picture

Well, there would have to be enough working class left over to do the rebuilding (or replacements could be imported I guess) otherwise the Keynesian magic won't happen.

See, central planning just looks easy.  That's why we should leave it to the experts.

Battleaxe's picture

Yes, import more! (at lower wages of course) And keep the profits in offshore accounts! This sounds good.

EscapeKey's picture

They are way ahead of you.

Battleaxe's picture

Oh, they already have? Well, the working class could declare war on the rich!

I Am The Unknown Comic's picture

Mercury I think you've got it! Obama-rama-lama-ding-dong could issue an executive order declaring war on small business owners....oh, wait...

....hmmm, maybe in order to get the biggest damage induced keynesian bang for the buck he should specify a war on WHITE small business owners....oh, wait....again.....

Mercury's picture

Right, and out of that rubble rebuild those destroyed goods and services capabilities with government agencies and bureaucrats...

I Am The Unknown Comic's picture

As Louie Armstrong might sing (if he were alive today) to Obama et al: 

"...and I think to myself,

what a beautiful progressive keynesian world.....oh, yeah"

francis_sawyer's picture

How about if we T.P. every house in America with rolls & rolls of that toilet paper that looks like dollar bills???

Oh no wait... The Bernank is already onto that one...


Quintus's picture

Ah yes.  The 'Broken Window' fallacy writ large.  Do these people never learn?

EscapeKey's picture

Learn? They profit from the broken windows, so what incentive do they have to "learn"?

Quintus's picture

You make an excellent point.

When we observe intelligent people doing apparently stupid things, we can safely assume that there are incentives prompting this behaviour.

silvertrain's picture

Good call, boost the economy by building more bombs and missles..The only thing we have to do is get rid of the old ones first to create a demand...

disabledvet's picture

Little rascals day...i'm all over that one.  seriously though:  obviously they can't.  "this is an actual crisis."  did they "surprise us with a brilliant insight" in response to 2008?  You tell me. I've been "sensing a blatantly obvious pattern" ever since.  Et tu?

Kina's picture

National House Burning day?

johnQpublic's picture

national death race 3000 day!

at amphetamine speedway speedway speedway!

where you'll see drug addled drivers racing racing racing!

and crashing crashing crashing!



oh wait....thats nascar and we have that...

101 years and counting's picture

this is a no brainer.  just declare spain and italy insolvent.  bail them out will add trillions in freshly created EUR and USD to the crack addicts on wall st.

throw in a UK or Japan, and the markets would flash dash to 15,000 in minutes!



uhb's picture

we could also give all the keynesians a pair of concrete shoes and dump them in the NY harbour...

Misean's picture

My favorite so far!

Temporalist's picture

They are trying to clean up those waters not make them cesspools.

Cleanclog's picture

Group think is often wrong - especially when it thinks positives will come quickly without building in the downside.   As I wrote March 15th Japan will continue to consume and import (particularly lumber, steel, copper, concrete, oil, and food for crops wiped out) - but much of that will be replacing things lost.  Not “growth”.  It won’t have substantial onward production value, it will be getting back to where it was.  

To afford this at a time their revenues will be reduced, debt is already staggeringly high, and the population is aging and stagnant - will mean they will reduce consumption of enjoyment in luxury goods and entertainment.  Hard times will mean hard choices. The Japanese have an ethic and culture that will enable them to sacrifice.  But the rest of the global economy will miss their consumptive contributions in other arenas.


And while attention, appropriately, is on the events unfolding in Japan . . .  a window opens for the Archduke Ferdinand moment elsewhere.  Mischief or worse in North Africa or the Arabian Peninsula is possible if Khaddafi  or Saudi rulers think the world is distracted.

A Man without Qualities's picture

We don't know what the fuck we are doing or whether it's making things better or worse, but we must inspire confidence in the worker classes, so we'll continue with our strategy and if it doesn't get better, we'll do more...

It reminds me of the doctors who would bleed patients (releasing humours) in order to "cure" illness.  Often, the patient would bleed to death as the doctors would continue the "treatment" if there was no sign of improvement...

Temporalist's picture

I made the same "humors" analogy recently here. 

I think they don't care if it's making things better or worse they make money and create power for themselves either way.

RobotTrader's picture

As long as gold and silver remain strong, it is probably suicidal to short stocks right now.

Misean's picture

The Aliens solution: Nuke it from orbit. It's the only way to be sure.

DonnieD's picture

Get our military to level Washington DC. Then we can rebuild it (bullish for CAT) and rearm the military (bullish for GD). Everyone can triple their investment in a week.

Shameful's picture

Simple, look who is signing the checks or passing the info to those who speak this dribble.  The Gov wisely owns the economics profession, and most don' have the stones to speak against their employer publicly.  After all if any of us spoke against our employer on national TV it would be a fast way to lose a job.

The theme is the State is all powerful and all knowing and the public should just accept it's words as is spoken by God.

It's funny when you snap someone out of the MSM training.  I'm fond of using the war is good for the economy.  If it was why not declare war on the ocean and drop men and material into the middle of the ocean till economic golden age?  Usually clears up the argument pretty quick.