You set up a market, call it a free, fair market and make $ or you close the market. A market that is 1/2 assed straight is pretty cool.

Stimulus vs. Bail out – not the same thing folks. Bail out Goldman — hey, might be the right thing, I do know that if I was the government I would get a cut. And apologies to the captitalists, but I would like to think I would tip well. Stimulus is when you send everybody, and I mean everybody in the country cold cash with a note saying spend it or die.

Government vs. Private Enterprise: Would someone step forward and tell me how you tell the difference between Goldman the bank and Goldman the Government? Oh, the Goldman G is a blind trust managed by Goldman the B.

Math, well I think numbers are really nice symbols but only an Economist would put them in a box.

It would be wrong for me to enumerate all your sins, but I find it truly interesting that you would attack so aggressively. You weren’t inviting considered thought. You were trashing.

I was never a fan of Friedman. He served certain vested interests quite well.

I am a Chicago GSB alum and always found the program to be a mix between really good and really bad. Merton Miller and Fama: Everyone should have had to participate in one of their classes. And Dornbusch on Macro was spectacular. But attending LAbor Law was like listening to a quarter long anti-union tirade.

Chicago was supposed to be about theory versus case study. Not about Friedman.

Based on their recent publications I suspect that they have become a little too populist or money grubbing . And they were on the Phil Gramm side of the recession is only mental. So they have some digging to do.

But the bottom line is their program used to be very, very solid. It’s really impressive. I remember my required interview with the Dean: George Schultz. There I was in a little room with a spectacular person. And Merton was good too. He had an open office and loved to exchange ideas. Oops, perhaps that spirit is gone.

I don’t blame people for wanting to trash Friedman. The University of Chicago community has trashed the University for wanting to name something after him.

But that’s one of the rare strengths of the U of C. They are about independent thinking. Teaching people to think.

My two cents.

paleotn,

past the cognitive dissonance, running rife, in your post, if you, really, care about “J. S-P” so much, why not explain to him how he’s getting shafted by Inflation, created by the FedRes, and Fraud, by his ‘banker’ who pretends to ‘loan him money’?

LSS: laissez faire economics, by any defensible definition, condones no Torts..

“What do you call a ‘game’ that has no rules?”

Eh? Of course it’s not a game at all, it’s nothing!

Businesses are a quest for profit! As such, they must do everything in their power to achieve a profit!

This means unless there is some prohibitions on their conduct, they will do anything and everything that figures to be profitable, including harming themselves when the cost/benefit ratio signals it can!

Competition also means that business can have no “conscience”, and must resort to whatever their competitors are doing, and try to do it even better!

So then, to ameliorate these effects, there must be outside intervention! That outside intervention comes in the form of Laws and regulations!

These L&R’s prevent businesses from harming themselves for profit, and therefore protect their investors.

These L&R’s prevent businesses from harming their customers in order to make easy profits, and therefore protect their consumers from substandard and/or dangerous products that businesses would otherwise sell!

These L&R’s prevent businesses from engaging in “bad practices”, ensuring that the businesses do things that are not harmful or destructive of faith and/or trust of the industries they regulate! This protects investors/lenders/consumers/workers et als., from being too easily fooled!

These L&R’s therefore protect businesses, not only from themselves, but from their competition as well.
They also protect businesses from consumers, workers, lenders, et als, who are also able to prey on the businesses.

Therefore it is L&R’s that create the game that businesses play! By giving them rules to obey and regulations to guide them, a somewhat “level playing field” is set up and tweaked as needed as “the game” evolves.

So then, what we are experiencing now is; the rules have been taken away, and/or enforcement of the L&R’s has been lacking! So, businesses have had to deal with competitors making profits by doing things that should not be done! Making profits by cashing in on the publics faith in L&R’s, that once kept the markets orderly. Making money in ways that destroyed the companies themselves, destroyed the publics faith in them, destroyed the publics trust of them. And as a consequence they’ve destroyed the publics faith and trust in the rule of laws that seemingly can’t be enforced!

Consequently what we’re seeing is businesses running on mere “traditional expectations”, rather than operating with in a real “game field of play”. Without any expectation that any rules can or will be enforced, there simply can’t be any “game”!

So where we are now is, we’re running on the most fundamental market devices — “cash paid for value received” — that can, so far, still be trusted. We’ve lost all of our financial systems sophisticated “money pooling” devices. Predicated, as they were, on the understandings that L&R’s had to be observed.

Eventually, if this condition goes on long enough, pressures, will begin to build, to the subversion of these remaining “traditional expectations” about business. That is, or will be, the very beginning of the end in the processes of “racing to the bottom” to stay ahead of competition.

From then on, we’ll be at the tender mercies of inflation/deflation, as to how practical it will be, to continue to use paper money to pay. That point, as Greenspan correctly says: “One cannot know until after it has happened”. that our currency has failed.

Obviously, since the Bush Adm., is the poster child of all this lawlessness, it stands to reason that any real effort to repudiate, and therefore correct, this situation, must begin with a dramatic “big bang”, which could not be served better than by bring down the symbol of it! We miss this opportunity at our extreme peril.

Obwon

AnnS wrote: “Mr. Spock and Commander Data have a better grasp of human behavior than Posner.”

That is the essence of what is wrong with Friedman and his cohort of chuckle heads. It is ironic that the fundamental defect in their ideology is so obvious even the average “Joe Six Pack” can easily grasp it. It is this defect that has directly lead us into the economic morass in which we find ourselves. If given the chance, in this case via laissez faire economics, will those with power economically screw those without much power? Many time, yes. Will those same people make decisions based upon short sighted greed, even if said decisions might ultimately result in the crash of the entire financial system? You betcha. How’s that for rationality? Monday morning quarterbacking? Not really. Many have been railing about the last two financial bubbles long before it was fashionable.

“Keynesianism is technically correct in the abstract. The idea is to smooth out the business cycle so that you have fewer booms and busts (which also creates a more stable society as the threat of violent revolution is lessened).”

This supports my conclusion that FDR saw Europe swinging to communism or fascism, and chose socialism as an alternative tnat would would best preserve his own(privileged) social class. He probably actually did care about the “ordinary folk” as well.

“(Friedman’s) philosophy demands that market participants ALWAYS take responsibility and he held accountable for their actions, including the possibility of financial ruin.”

Then his philosophy cannot be regarded as a failure, because it has not been truly tested. That would require that the price of goods and services reflect their TRUE COST. The price of electricity would include the cost of responsible disposal of waste.

Time and again, the federal government has used diplomat and military means on behalf of corporate interests (not American corporations, but global, non-American corporations. Installing the Shah in Iran, taking sides in a civil war in SE Asia, etc. has been marketed to the public as “protecting America’s interests abroad.” Viet Nam, like Pearl Harbor was about oil, not democracy. The horribly miscast “War on Terror” is justified by “They hate us for our freedoms.”

If the corporations had to fight their own wars, hiring mercenaries at the going rate and paying for it themselves, then market forces would make war unprofitabe, and negotiation preferable. The price of goods and service would rise to reflect actual costs, but it would be a more peaceful world.