Wednesday, June 23, 2010

TVs, Homes, Unemployment, etc.

If you have one million television sets and you want to sell them but no one wants to buy them, what should you do? If you want to sell your home, but no one wants to buy it, what should you do? If you want to work, but no one will hire you, what should you do?

If you said: "LOWER THE ASKING PRICE!," then you would be likely to sell TVs, sell your home, and find a job.

On the other hand, if you say: "print counterfeit dollars to raise prices in order to artificially stimulate aggregate demand" or "create a government sponsored entity that underwrites loans to people that want to buy stuff" or "pass minimum wage laws that RAISE the price of labor" or "extend benefits to encourage people not to seek work" or "burn the televisions, and bulldoze the homes" then you get a PhD from an Ivy League school and/or a job in the Obama administration.

5 comments:

C. August said...

Did you see this Carpe Diem post last week? His quote of the day was:

"The inverse relationship between quantity demanded and price is the core proposition in economic science, which embodies the presupposition that human choice behavior is sufficiently rational to allow predictions to be made. Just as no physicist would claim that "water runs uphill," no self-respecting economist would claim that increases in the minimum wage increase employment. Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimal scientific content in economics, and that, in consequence, economists can do nothing but write as advocates for ideological interests. Fortunately, only a handful of economists are willing to throw over the teaching of two centuries; we have not yet become a bevy of camp-following whores."

~James M. Buchanan, 1986 Nobel laureate in economics, writing in the Wall Street Journal on April 25, 1996


I was going to--but of course never did--write a post called "Krugman: King of the Camp-Following Whores."

Doug Reich said...

BEAUTIFUL!

Thanks

mtnrunner2 said...

>"Krugman: King of the Camp-Following Whores."

That's who came to my mind first. lol.

Or James K. Galbraith.

Joe said...

"...then you get a PhD from an Ivy League school and/or a job in the Obama administration. "

Or Bush administration.

Doug Reich said...

I agree, but there is no Bush administration so I left that out.