Local & offshore stimulunacy [update 6]

Do I really need to write any more on so-called stimulus packages, or the fiction of the so-called multiplier effect, just because John Boy and Billy Bob invoke these statist delusions again today?

UPDATE 1: 61 traitors voted to pass America’s stimulunacy package.  Jeff Perren has a list of just some of the pork for which American taxpayers are going to have their pockets picked, absurdities which almost make our local package look sensible, and the Wall Street Journal steps up to the plate with this cogent dismissal of error at the heart of the stimulunacy and the multiplier delusion.

    So there it is: Mr. Obama [and the local layabouts are] now endorsing a sort of reductionist Keynesianism that argues that any government spending is an economic stimulus. This is so manifestly false that we doubt Mr. Obama [or the local layabouts] really believes it. He has to know that it matters what the government spends the money on, as well as how it is financed. A dollar doled out in jobless benefits may well be spent by the worker who receives it. That $1 of spending will count as economic activity and add to GDP.
    But that same dollar can't be conjured out of thin air. The government has to take that dollar away from someone else -- either in higher taxes, or by issuing new debt in the form of a bond. The person who is taxed or buys the bond will have $1 less to spend. If the beneficiary of that $1 spends it on something less productive than the taxed American or the lender would have, then the net impact on growth will be negative.

 UPDATE 2: Wanna get your head around the scale of the problem created by all this stimulunacy? Simple.  Just watch Glenn Beck Making Fed Data Fun & Scary.

UPDATE 3: Paul Walker says:

    Given that the government has just announced that it will waste $500 million of taxpayers money on our very own stimulus package, it may have helped if John Key had read the recent Wall Street Journal article by Gary S. Becker, the 1992 Nobel economics laureate, a professor of economics at the University of Chicago and senior fellow at the Hoover Institution, and Kevin M. Murphy, a MacArthur Fellow, an economics professor at the University of Chicago and a senior fellow at the Hoover Institution, before making such an announcement.
    Becker and Murphy make the obvious, to everyone but the government, point that There's No Stimulus Free Lunch: It's hard to spend wise and spend fast…
    [Their] four points apply as much to New Zealand as they do to the US, so I would like to hear the government's reply to them. It is incumbent on both supporters, and opponents, of any stimulus package to evaluate each of [their] four factors. Has the government really done this? If so, what are their conclusions? If not, why not?

UPDATE 4 [revised]: Charles Anderson has done some sums for Obama’s package. At US$825 billion and an estimated 3.7 million jobs “saved” (an estimate without backup, by the way), “The cost per job created or saved in Obama's plan,” he says, “can be calculated to be US$222,973”!

The exclamation mark is my own. 

Feel free to send me your own calculations showing us how much NZ taxpayers will be paying per “job” to attempt to keep the economy inflated. You may use in your calculations either the NZ$500 million boasted about in John Boy’s and Billy Bob’s announcement early this morning, or the NZ$11 billion boasted about in parliament earlier this morning, or the NZ$35 billion Bill English told the House this afternoon is going to have to be borrowed over the next five years just to avoid cutting spending (the sort of thing Roger Douglas called “mortgaging our children for the next round of spending increases,” and Dick Armey more colourfully called “fiscal child abuse.”  You could divide these by some arithmetical sum based on the “the 170,000 people predicted by Treasury to be unemployed over the next 3 years,” the 105,000 people presently drawing the dole, or the roughly 300,000 NZers on all forms of welfare (apart from WFF).

UPDATE 5: Newstalk ZB’s Barry Soper reckons that when asked about the number of jobs he expect this package to “create,” John Boy nodded his head at a figure of about 2000.

UPDATE 6:  Here’s a question for eager young economists:  How about you explain in one easy paragraph the relationship between the Broken Window Fallacy and the jobs created and the money spent through “stimulus” packages like this.  And then send that explanation to all those so-called economists talking it up who clearly don’t have a clue what you’d be talking about.

UPDATE 7: Be thankful for small mercies, says Liberty Scott. “Be grateful the package is rather small, [which means] its damage will be relatively small.”

Stimulus: Because all economies have performance issues [update 2]

This year, Australian taxpayers will receive, from their Government, an Economic Stimulus Payment. A shopping subsidy. This is a very exciting new programme that can be explained using the Q and A format:

Q. What is an Economic Stimulus Payment?
A. It is money that the federal government sends to taxpayers.

Q. Where will the government get this money?
A. From taxpayers.

Q. So the government is giving me back my own money?
A. Only a smidgen.

Q. What is the purpose of this payment?
A. The plan is that you will use the money to purchase a
High definition TV set or a new computer, thus stimulating the economy.

Q. But isn't that stimulating the economy of China?
A. Um.

Q: Well, how on earth does it stimulate the one whose taxpayers are paying to be stimulated?
A: It's all about the "multiplier."

Q: The "multiplier"?
A: Yes, the "multiplier." Every dollar the government "injects" into the economy creates an even larger increase in national output -- a multiple up to one-and-a-half times the original spend-up. The money the government is giving away goes to retailers, which then goes to producers, which then goes to other producers and so on. The net result of the spend-up, as the theory goes, will be new jobs and an overall increase in the nation's income.

Q: So the government is giving me back a smidgen of my own money, and this smidgen is multiplied several times to create a "stimulus?
A. You've got it.

Q: And it keeps prices up?
A: We hope so.

Q: But don't prices need to fall in a recession to get real production going again?
A: Well, yes.

Q: And it's not even backed by real demand, is it?
A: Well, no.

Q: So how long can such an artificial stimulus last, then?
A: Um, the theory is that it's only temporary at best.

Q: And what sort of stimulus would it have created if I'd been able to keep that money myself, and either spend it or save it?
A: Well . . .

Q: Or if producers had been able to keep their own money?
A: Um . . .

Q: So it would be fair to argue that "not only does the increase in government outlays not raise overall output by a positive multiple; but, on the contrary, [it actually] leads to the weakening in the process of wealth generation in general.”
A: But . . .

Q: And this is the whole theory? This is all you economists can come up with?
A: Well, that's about it, yes.

Q: So it's a bit like when "a carnival magician produces a quarter from behind a child's ear," isn't it. "The 'magic' of the multiplier is mere illusion."
A: Hush your mouth. People are listening.

Q: No answer?
A: Sorry, we're a bit busy right now shovelling money out the door.

* * * * Stimulus: Because all economies have performance issues * * * *

[Hat tip (and pic) Tim Andrews & Sus]

UPDATE 1: Courtesy of Greg Mankiw [with a hat tip to Anti Dismal], here is John Maynard Keynes of 1942 six years after The General Theory, showing he was still wrong about his general theory, but moving towards being right on specifics:

Organized public works, at home and abroad, may be the right cure for a chronic tendency to a deficiency of effective demand. But they are not capable of sufficiently rapid organisation (and above all cannot be reversed or undone at a later date), to be the most serviceable instrument for the prevention of the trade cycle.

UPDATE 2: Subsidies for everyone? If we all have to endure the "stimulus" packages of politicans, then how about a stimulus package for bloggers? The excellent 14-point case for prudent profligacy [hat tip TVHE] concludes,

This is an important campaign. Your comments of support ... help make the case to government...
With sufficient momentum we can make sure the stimulus is not wasted on filling in freshly dug holes, fixing the environment or building bridges to nowhere - all things that the market is perfectly capable of doing by itself. Instead of Bridges to Nowhere, what this economy really needs is a serious infusion of Blogs about Nothing.

Amen to that. May I forward you this humble blogger's bank account details? ;^)

On Stimularithmetic, and Team Obama's 'Old Left' Stimulunacy

It's not just Robert Barro who's questioning the proposed economic effect of Team Obama's "stimulus" package, which promises to shower Americans with new doles, new bridges to nowhere, "green jobs," "renewable energy" projects, and failing car companies producing even shittier cars that even fewer people will want (and remember the working definition of "renewable energy.")

Team Obama, remember, reckons their "stimulus" package will have a "multiplier effect" on the US economy of 1.5; Barro reckons they've got their sums wrong. ("A much more plausible starting point is a multiplier of zero. In this case, the GDP is given, and a rise in government purchases requires an equal fall in the total of other parts of GDP -- consumption, investment and net exports. In other words, the social cost of one unit of additional government purchases is one.")

And, naturally, other economists are joining the fray, and Arnold Kling has summarised the differences between two proponents on either side of the debate, one who predicts that with every $100 of government spending we'll see $87 worth of benefits, and another who predicts we'll lose $80 (see Paul Walker's summary here), suggesting nothing so much, perhaps, as that there is nothing so pointless as expecting results from economists doing algrebra.

Fact is, a pump primed is a recovery delayed.

So it's more instructive not just to notice that there are Republicans who are now growing spines that were nowhere in evidence over the last eight years -- and certainly not over the last eight months while their own bosses set about nationalising the banking industry -- but to appreciate the analysis of those like Robert Tracinski who leave their algebra in their brief case, and engage instead in pure logic.

Obama, says Tracinski bluntly, has no idea what he's doing.

Obama begins his administration by declaring that he will run the government
while rejecting any overarching ideas and principles regarding the proper role
and scope of government action. He starts by telling us, in effect, that he has
no idea what he is doing.

As we've noted here before. And wasn't there another US president of similar mien? Oh yes, there was:

Decades ago, we had another president who came into power during an economic
crisis, who also had no idea what he was doing and engaged instead in "bold,
persistent experimentation"--with his only absolute being that he would not let
the free market work. That was FDR. The result? The economic crisis lasted
another decade and actually deepened under his leadership. If Obama's speech is
what a cipher sounds like, the Great Depression is the kind of result that is
produced when an ambitious cipher attempts to offer vigorous leadership.

The "stimulus" package is just further evidence that Obama really doesn't know what he's doing any more than Roosevelt ever did, and that the results of what he does try to do will be as destructive as his most natural historical predecessor. Evidence too that it's when politicians are most ignorant of what the hell they're doing that they reach most vigorously for the interventionist levers -- since to them that most represents "vigorous leadership."

As Tracinski points out in his TIA Daily newsletter, it's entirely logical then that Team Obama's first moves represents a systematic "leftist onslaught" against automobiles, power plants, banks, trade, guns, and the war on terrorism, since his reign offers nothing so much as the chance for the resurgence of the Old Left. Thus:

He is pushing for global warming regulations and for heavy new regulatory restriction on the financial industry—and he is now considering outright nationalization of the banks. He's threatening to reverse the trend toward free international trade, openly inviting Congress to impose new gun bans, and removing the US government from a war footing in its fight against terrorism.
He's also doing a few things to reverse the agenda of the religious right—but on a small scale compared to his assault on the values held dear by those of us on the secular right: free markets and vigorous national defense.

Let's take the main points of this onslaught in turn:

Let's start with environmentalism. Despite speculation that the new president would shelve global warming regulations because of the economic crisis, he has put up on his new White House website a promise to "implement an economy-wide cap-and-trade program to reduce greenhouse gas emissions 80 percent by 2050."
Since "renewable energy" will not be able to replace fossil fuels [remember the definition], that means roughly an 80% reduction in our energy use over the next four decades, which in turns means roughly an 80% reduction in our standard of living. It is a plan to make economic depression a permanent fact of life.

Consistent with this is his attack on automobiles, "ordering the EPA to allow California and a cabal of other states to impose new fuel-efficiency regulations on automakers, in the name of stopping global warming. The irony, of course, is that this is another devastating blow to the very same Detroit automakers that the Obama Administration has insisted on bailing out." (Be still: This won't be the only irony of this Administration.)

It continues. As Tracinski points out, Team Obama is consistent: they're against both the internal combustion engine and coal-fired power plants -- the two power sources of America's industrial power -- firing the first shot in this battle against coal and real energy in its sponsoring of the EPA's spiking of the 580 MWe Big Stone II coal power plant in South Dakota. (See here and here and here.)

And meanwhile, in the midst of financial disaster, he's looking to throttle the banking industry, and showing signs he wants to complete the nationalisation of banks begun under his immediate predecessor, back when Republican spines had atrophied from under-use.

And he's already fired the first shots against trade -- something every New Zealander needs to be concerned about. Says Tracinski:

The resurgence of the Old Left brings the revival of bad ideas by the dozen. So not only do we get a resurrection of nationalization and central planning; we also get a resurrection of protectionism.
Thus, President Obama's incoming Treasury secretary has indicated the new administration's willingness to start a trade war with China. That's just what we need to complete the current replay of the Great Depression: a new Smoot-Hawley tariff to shut down global trade.
This is what the resurgence of the left means: an attempt to make us forget all of the lessons that we learned, at great cost, during the economic disasters and cataclysmic wars of the 20th century.

And on top of all this, he's moved against the Supreme Court's 2008 decision recognizing a constitutional right to own guns (despite his campaign statement approving of the ruling and pledging his loyalty to the Second Amendment), and with the closing down of the terrorist prisoner-of-war camp at Guantanamo Bay and the appointment of appeaser George Mitchell as Middle Eastern envoy, indicating that the US War Against Terrorists is effectively over.

So, yes, the Obamessiah is moving fast, but not quite so benevolently as some commentators might have been hoping for.

FAQ: Can fiscal stimulus save us?

Q: Can all this fiscal stimulus save the US economy?
A: No. It can’t.

Q:Why’s that?
A: Because the fundamental problem is not lack of money to shore up demand, but lack of goods to pay for real demand –- that is, lack of the sort of goods that are being demanded -- and no amount of “stimulus” can fix that.  All it can do is make the production of those goods more difficult.

Read Can Fiscal Stimulus Revive the US Economy? for the details.  As Frank Shostak points out there, “not only does the increase in government outlays not raise overall output by a positive multiple; but, on the contrary, this leads to the weakening in the process of wealth generation in general.”

This is the case not just for the US, but for anyone who tries the same “stimulus” shenanigans.  Can someone please explain all this to Little Billy English, the Pink Tory Pump-Primer.

UPDATE: Further on Shostak's point quoted above, Economist Robert Barro (highly rated by the likes of Richard Salsman) points out that the idea of a positive mutiplier from government spending (i.e., the result predicted by the simple Keynesian macroeconomic model) "implicitly assumes that the government is better than the private market at marshaling idle resources to produce useful stuff. Unemployed labor and capital can be utilized at essentially zero social cost, but the private market is somehow unable to figure any of this out. In other words, there is something wrong with the price system."

In other words, any notion of a positive multiple is mistaken. As Barro argues, 

"A much more plausible starting point is a multiplier of zero. In this case, the GDP is given, and a rise in government purchases requires an equal fall in the total of other parts of GDP -- consumption, investment and net exports. In other words, the social cost of one unit of additional government purchases is one."

Read Barro's argument over at Paul Walker's Anti Dismal: Government Spending is No Free Lunch.

Maori Party: Once were Santa Claus [updated]

Government accounts just keep on getting worse and worse and worse, but still the election bribes just keep on coming, and keep on getting bigger. 

The latest bribe to make it into the headlines is from the Maori Party, offering to pay a $500 Christmas bonus with your money, $136.5million of it in total, to help them buy votes.

And that's not even the scariest part. 

What's scariest is their justification for the bribe.  "This is the multiplier effect," says says the economically illiterate Pita Sharples, co-leader of the Maori Party. "This money will keep people buying; it will help businesses and workers by stimulating the economy, retailers will benefit from increased turnover."

Yes, Pita.  And taxpayers would benefit if that money had been left in their pockets.

This so called "multiplier effect" is a complete bloody fiction, another Keynesian nonsense -- and a prime example of the Broken Window Fallacy. 

First of all, government isn't Santa Claus, with a cave full of elves pumping out goods and services. The government can only get money to "invest" by one of three ways: by taxing, by borrowing or by printing money. So if it taxes, borrows or prints money to give to $136.5 million to consumers to buy votes, then it has to take that $136.5 million (plus collection expenses) away from producers who would have used it to produce and invest more.  One feeds consumption, reducing the resources for production; the other feeds production, producing the wealth we need to survive. Only one of these makes us richer -- but it's much easier for politicians to steal from producers to buy votes than it is to just stand back and let production happen.

The fact is that consumption does not make us richer, no matter how many Keynesian textbooks you consume. The world is not going broke for a shortage of consumption, but precisely the reverse: for too many years, consumers have been consuming too much of the wealth that should have been used for production.  Production is the horse that drives the economic cart: adding money taken from producers does not add any new goods and services to be exchanged.  It depletes them.

That the Maori Party doesn't understand any of this should give the lie to any claim that they are a responsible party with whom to be in coalition -- except that no other mainstream party understands it either.

An election is an advance auction of stolen goods.  Don't forget that -- especially when we can't afford the theft.

UPDATE: Cactus Kate puts it bluntly:

    If Maori want to relieve poverty and keep their precious tino rangitiratanga and mana then perhaps they should go to their own tribes and [ask for] a dividend from their commercial enterprises -- all funded from white-guilt Treaty Settlements...
    But then Maori Leaders with commercial nous and intellect are far too sensible to do this with money that is now in their own names. They fuel it through education and scholarship, not give it directly to the “poor” who by their own definition of being “poor” have proven they can’t handle their own money.

$250 billion worth of panic.

The world's central banks are in a panic this morning, and the extent of their panic can be measured: $250 billion worth of panic.  That's how much they're quaking.  That's the amount of money six of the world's central bankers are printing up right now to spray over the world's markets in another vain attempt to prop up the system that all their high-strung economic theories told them was impregnable.

$250 billion worth of further inflation that we're all going to have to pay for, on top of all the other "credit injections" and bailout money dropped on world markets like manna from a non-existent heaven.

$250 billion manufactured out of thin air.

$250 billion that will do nothing to make bad loans magically disappear.

$250 billion worth of counterfeit capital that will have to be paid for, inescapably, out of real savings, yours and mine.

$250 billion that will do precisely nothing to allay the profound structural imbalances that government meddling, government regulation and government central banks have made to the structure of the world's capital, because while government central bankers tinker with the effects of the "secondary depression" -- the turmoil in the markets that is currently making headlines and causing politicians everywhere to blame capitalism for the damage they and their central banks have done to it -- the "primary depression" which is the cause of all the turmoil is still unaddressed -- and until it is, says Antony Mueller in today's Mises Daily article, the chickens of failed economic theory will keep coming home to roost.  This is not a "cyclical adjustment" he argues, "The current economic disaster is the result of the combination of negligence, hubris, and wrong economic theory":

     For decades, an economic and monetary policy has been practiced based on the illusion of, "It doesn't matter." At first it was, "Deficits don't matter." From that, the policy of "it doesn't matter" got extended to money creation, the credit expansion, the stock-market bubble, and the housing boom. Now, we're being told that buying financial junk by the central bank to beef up banks and brokerages also doesn't matter.
    As a byproduct of this mindless economic and monetary policy, financial market operators, too, have lost their heads. Trusting the official cheerleaders, investors hold on in the trenches until they will have lost their last shirt. Economic weakness is spreading around the globe. There is no new spurt of economic growth in sight. Yet many investors stay put because they have been conditioned to believe that government will bail them out.
    The current financial crisis is not of a cyclical nature. The financial turmoil is the symptom of the structural imbalances in the real economy. Over decades, expansive monetary policy has gone hand in hand with implicit and explicit bailout guarantees, and this has distorted the process of capital allocation. Under such perverted conditions, those investors will win most who cast away the restraints of prudence. It is a game that can go on for a long time — up to the point when the irrationality has become systemic...

A profound restructuring of global capital has become unavoidable. Such a process is quite different from a recession in the traditional sense. In contrast to a sharp and typically short-lived recession, when, after the rupture, business as usual can go on, the restructuring of a distorted capital structure will require time to play out. Rebalancing the distorted capital structure of an economy requires enduring nitty-gritty entrepreneurial piecemeal work. This can only be done under the guidance of the discovery process of competition, as it is inherent in the workings of the price system of the unhampered market.
    Anticyclical fiscal and monetary policies are of no help when it comes to the daily toil in business to work towards reestablishing a balanced capital structure. The so-called income multiplier won't work, and lower interest rates won't stimulate spending. On the contrary: these policy measures only make the task of the entrepreneur harder.
    The difficulties ahead arise from the problem that business as usual cannot go on under conditions of a credit crunch, which has its roots in the distortions of the economy's capital structure. Thus, even if the financial market turmoil were to settle, there won't be the simple resumption of the old ways of doing business. The belief that, after the financial crisis is over, the real economy can reemerge unscathed, is probably the greatest error that many investors share with the policymakers.
    As a result of the bailouts and the socialization of the mortgage agencies, the financial system is now fully infected with moral hazard. The disastrous effects of these government interventions will show up soon. The major task of bringing the capital structure in order is still ahead and more pain is in the waiting...

The pain will continue as long as the primary causes are left unaddressed, and will be exacerbated severely if misunderstood as the result of "deregulation," a nonsense only a presidential candidate would be dumb enough to suggest, and if applied can only delay the necessary "nitty-gritty entrepreneurial piecemeal work" required to restructure the world's capital markets to reflect real price signals in an unhampered market.

UPDATE: The good chaps at NZ's Foundation for Economic Growth tot up the total bill:

    The USA has now pushed nearly US$1 Trillion out of the helicopter to stop the economy from failing. $168 Billion refund to taxpayers, $85 Billion to AIG, $100 Billion to each of Fannie and Freddie and $29 Billion to Bear Stearns - pity about poor old Lehmans. Plus who knows how many billions into the various stressed banks around the country.
    Where does all this money come from. Is the Federal Reserve really worth that much that it can just parcel up $1 Trillion and hand it out.
    Of course not. This is just more debt on which taxpayers of the future will have to pay interest...

And of course, this is US$1 Trillion plus the overnight bill. That's a lot of corporate welfare.

Watch out for the green bubble bath (updated)

In the seventeenth century it was the tulip bulb mania.  In the eighteenth it was the South Seas Bubble.  In the nineteen-twenties it was a stock market boom and a bubble in Florida swamp land; in the eighties a boom in sales of white shoes, gold chains and shoulder pads; and in the late nineties a "dot-com boom" in which even the most be-pimpled jandal-wearing geek was able to float an IPO to buyers eager to 'invest' their piles of borrowed government-created credit in schemes ranging from bizarre to unlikely.   All of these various bubbles imploded leaving investors taking a bath and creditors awash in un-backed IOUs -- which largely describes the government-created credit most 'investors' were using to seek their fortunes. 

The lesson is obvious enough: Boom leads to bust.  Today's rocket-fuelled "irrational exuberance" is tomorrow's rational reflection that every time the currency is inflated in the way central bankers periodically like to do, prices tend to inflate like the Hindenburg did just before the airship fell to earth in a shower of sparks.

Any time borrowers are flush with excess credit you see a boom in whatever borrowers like to decide is fashionable, and rampant inflation in prices in markets conveniently not measured in the central bankers' inflation-measuring baskets.  The most recent boom in property prices is just one bubble in which some investors are already taking a sub-prime bath.  Here's another to keep an eye on: Alternative energy. 

Notes Harper's magazine in support of this thesis, the alternative energy bubble has the legs to go all the way, just like the Hindenburg did: it's fashionable; it's driven by legislation and subsidy; and already companies like First Solar (who on the back of an 800% rise in share price were declared Wall Street Journal's "best 1-year performer" ) have become the darlings of Wall Street, despite a grand total of 12 clients, factories producing to capacity and what one analyst calls "an enormous multiplier." (Says Zachary Scheidt of Stearman Capital, "The deck seems stacked against shareholders at this time, not due to the inadequacy of management or the strength of the company, but simply due to the unbridled enthusiasm of investors.")  How bad will this bubble be?  Harper's estimates

the gross market value of all enterprises needed to develop hydroelectric power, geothermal energy, nuclear energy, wind farms, solar power, and hydrogen-powered fuel-cell technology—and the infrastructure to support it—is somewhere between $2 trillion and $4 trillion; assuming the bubble can get started, the hyperinflated fictitious value could add another $12 trillion. In a hyperinflation, infrastructure upgrades will accelerate, with plenty of opportunity for big government contractors fleeing the declining market in Iraq. Thus, we can expect to see the creation of another $8 trillion in fictitious value, which gives us an estimate of $20 trillion in speculative wealth, money that inevitably will be employed to increase share prices rather than to deliver “energy security.” When the bubble finally bursts, we will be left to mop up after yet another devastated industry.

Let us remind ourselves that this and every other bubble was created by debasing the currency -- a "seeming golden age — in reality, a thinly gilded one — during which the first, most favored issuers of cheap credit and artificially boosted equity prices enjoyed almost effortless success, but whose successes must eventually be paid in the destruction of real capital.   As Sean Corrigan notes, real, physical capital was never called into being quite so readily as the artificial credit created out of thin air by central banks, since the creation of real, physical capital "requires not the staccato keystroke of a fiat banker, but entrepreneurial vision, hard work, and genuine saving."

By that last we mean a voluntary abstention from current consumption, undertaken in order to improve the chance of greater plenty in the future, and not the corrupt preemption of a man's spending power — effected with monetary trickery — which inflationists laud as "forced saving." Being a species of initially unrecognized compulsion, this is a deceit doomed to fatal self-contradiction once its dupes wake up to the nature of the con being practiced upon them.

PS: Here's Czech president talking to Glen Beck about how freedom is more important than warmism and subsidised climate nonsense.

UPDATE: A reader has drawn my attention to the fact that while the Harper's article makes good sense on the possible energy boom-and-bust, it peddles pure Keynesian bullshit in earlier parts of the piece.  See here for example.  Readers are warned to skip the earlier paragraphs head straight to the sections on alternative energy, and discard the rest as arrant nonsense.