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Posts Tagged ‘Intelligence Squared’

Last week in New York City, during my Intelligence Squared debate about stimulus, I pointed out that Germany is doing better than the United States and explained that they largely avoided any Bush/Obama Keynesian spending binges.

One of my opponents disagreed and asserted that I was wrong. Germany, this person argued, was dong better because it was more Keynesian thanks to “automatic stabilizers” that resulted in big spending increases.

This claim was made with such certainty that I wondered if I made a mistake.

Well, we were both right about Germany doing better. In the past few years, it has been enjoying yearly growth of about 3.5 percent while growth in the United States has remained below 3 percent.

But who was right about the key issue of whether Germany has been more Keynesian? At first, I was going to be lazy and not bother combing the data. But then I got motivated after reading an excellent post about Germany’s pro-growth reforms, written for National Review by Veronique de Rugy of the Mercatus Center.

So I looked up the data on annual government spending in the United States and Germany and discovered that I was right (gee, what a shock). As the chart shows, the burden of government spending has increased faster in the United States. And that is true whether 2007 or 2008 is used as the base year.

To make sure the comparison was fair, I sliced the numbers every possible way. But the results were the same, regardless of whether state and local government spending was included, whether TARP spending was included, which base year was selected, or whether I used annual spending increases or multi-year spending increases.

In every single case, the burden of government spending grew faster in the United States from 2007 to 2011.

This does not mean Germany is a role model. Government spending in Germany is far too high and it continues to grow. All we can say is that Germany is not going in the wrong direction as fast as the United States.

Oh, I suppose we also can say that I was right and my opponent was wrong. The United States has been more Keynesian than Germany.

Speaking of Germany, I combed my archives and found only one post that said anything nice about German politicians.

My other German posts mocked the country’s scheme to tax prostitutes, mocked the government for losing the blueprints for its new spy headquarters, mocked the government for a money-losing scheme to tax coffee, and even mocked the supposedly conservative Chancellor for wanting to impose new taxes.

So even though Veronique is correct about some positive changes, the Germans have a long way to go.

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Folks of a certain age, who watched ABC’s Wide World of Sports, will remember the phrase “the agony of defeat.”

Well, that’s what Richard Epstein and I endured Tuesday night at the Intelligence Squared debate in New York City.

We were battling against two Keynesians, Mark Zandi and Cecilia Rouse, in hopes of convincing the audience to reject the proposition that “Congress should pass Obama’s jobs plan.”

The good news is that only 16 percent of the audience were on our side before the debate, and we managed to push that number up to 22 percent.

The bad news, however, is that 45 percent of the audience began the night agreeing with the Keynesian position and that number rose to 69 percent.

Cornelius Vanderbilt is rumored to have said, “the people be damned.” I’m tempted to stamp my feet and say the same thing, but I already did plenty of whining in a recent post, so I guess I’ll just have to suck it up and admit I somehow should have been more persuasive.

Here is some of what Elizabeth Weingarten wrote in her report for Slate.

The audience at last night’s Slate/Intelligence Squared U.S. live debate at NYU’s Skirball Center vehemently agreed with the president: After the conclusion of the debate, 69 percent voted forthe motion “Congress should pass Obama’s jobs bill—piece by piece”; 22 percent voted against the motion; and 9 percent were undecided. …NYU law professor Richard Epstein and Cato Institute senior fellow Dan Mitchell endured hisses and boos, while chief economist of Moody’s Analytics Mark Zandi and Princeton University economics professor Cecilia Rouse won laughter and applause as they took the president’s side. …Mitchell and Epstein began the debate strongly, especially when Mitchell engaged the audience in a clever “quiz” to show that the American Jobs Plan is simply a repeat of failed economic policy. “Let’s divide this room in half,” he began. “Let’s borrow all the money out of the pockets of the people on this side of the room and give it to the people on this side of the room. Now here’s the quiz. Raise your hand if you think there’s more money in the room.” The audience chuckled. This stimulus, he explained, is simply a redistribution of national income. “Our goal should be not to redistribute national income; we want to increase national income,” Mitchell said. “We want a bigger pie so everyone can get a bigger slice; that’s what economic growth is all about.”But soon, Mitchell and Epstein seemed to fall from grace. …After the debate, Donvan reflected on Mitchell’s debate strategy. “Dan Mitchell’s willingness to play the ogre, as he put it, read fun and bold, but I think it didn’t help sell the side,” he said. He even thought Mitchell and Epstein “presented a more comprehensive argument” than the other team. But it “was also the view from 30,000 feet, and less satisfying for an audience asking for a jobs solution right now.” …When I asked Mitchell why he lost after the debate, he told me it was because he was forced to play the villain. “The challenge of defending free markets and limited government is that you’re telling people there’s no Santa Claus,” Mitchell said. “Everyone likes to think that there’s some magic wand the government can wave, and especially if you’re in a position where you can be pigeonholed as somehow defending the interest of the wealthy, it makes it even harder.”

I’m not sure how I should feel about being described as an ogre, but I suppose it’s good that the moderator basically said that Richard and I presented a better argument.

In other words, maybe I should put the blame on the denizens of New York City!

But that’s no excuse. If we’re going to save America from becoming another Greece, we better figure out how to educate people who have been lured into thinking government is Santa Claus.

At some point, the people from Intelligence Squared will post a video of the debate. In the meantime, you can watch this video of me debunking Keynesian economics and this video eviscerating Obama’s faux stimulus.

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