Arnold Kling does not say anything original here, but it is material which should be studied. I am glad that Arnold can admit to being wrong about the degree of Trade in early times, something I had great difficulty defending in a history class. We know Today that the Mandan Indians raised Corn for almost all of north America for over a Century and possibly longer; finding artifacts from as far as Russia and Mexico City in archeological digs. I disagree with some of Ridley reasoning, knowing that the mixture of found animal bones at Sites indicate that ancient hunters were concerned with volume, not hunting prowess. Accolades do not make up for hunger. Study of Monkeys also do indicate there is a form of Commons sharing between Groups, with alternate forest hunted in alternate periods by several animal groups; this likely to avoid Conflict between Groups. The common Indian Sign language throughout north America expresses assured Trade, simply through the lack of value of Sign language without widespread Trade.
Dean Baker presents Us with a good Keynesian argument, and it would be excellent rationale in a much simpler world. My fear, though, remains that Stimulus resides on a Bell Curve, like so many things can be replicated. Stimulus makes huge Gains in an arena where there has been no previous Stimulus. What happens if the Government already makes up 20% of the Demand; said quantity already within captured markets? Government suppliers have organized their Production and Supply systems under prior economic conditions, and reduced their labor force to maximum Productivity. Now, if Stimulus is actually on a Bell Curve, there comes a Time where Gain is less than level of Stimulus, and the residual becomes only an economic Cost. This can only be worsened if all Stimulus is done by Debt aggregation, draining funds from Private capitalization. This is my dilemma!
This Post by way of Mark Thoma comes from Akerlof and Kranton. I ask the Reader to define How this Post relates to the previous paragraphs. Identification of class status could be a prime motivator in both paragraphs. It might be easier to understand in the first paragraph over the second. How would you imagine Readers of the Baker Post would respond if they were Politicians, Government Suppliers or their Employees, or Bond Sellers? Now imagine you were a small businessman with no chance of Government supply contracts and a Taxpayer; could you conjure a different Response? Let’s think of the posture of a Laid-Off Employee: would he be in favor of Stimulus, except possibly if he worked for a Government Supplier? There are several alternate institutions affecting decision-making of this order, and all potential Mustangs. My only Statement consists of the fact this is the matrix within which economic decisions are taken. lgl