Logic Deficit: Why Were Reinhart-Rogoff Ever Taken Seriously?

[ashling]

No part of this story makes any sense. No one, not even a Harvard economist, really believes that a country with no assets and a country with a huge amount of assets are in the same financial situation just because they face the same debt burden. Nor does anyone believe that there is the potential massive growth dividend available from selling off government assets that the RR analysis implied.

In short, RR's analysis never was plausible, even if their spreadsheet had been correct. The fact that so many people in positions of authority were willing to embrace RR says a great deal about this people. We can and should discard RR's outlandish claims about the impact of debt on growth. We should also be asking some serious questions about our elites and their willingness to accept economic nonsense just because it fits their agenda.

http://truth-out.org/news/item/16089-logic-deficit-why-were-reinhart-rogoff-ever-taken-seriously

[byeya]

1. Keynes: Tried and passed. Monetarism/Supplyside: Tried and failed.

Churning out crapola for the ultras to use to justify massive lobbying and ad campaigns to bring them greater wealth and power.

[Fumesucker]

2. Because they were saying what the Very Serious People wanted to hear

QED

[winter is coming]

4. +1,0000,0000.

Amazing to me that so much reliance was placed on something that wasn't even peer-reviewed.

[HiPointDem]

3. same reason all that stuff is taken seriously. because it suits the ruling class.

[librechik]

5. thye just wanted it to be true SO BAD that they didn't even check.

they are dying to strip us bare and use it all to buy enough champagne to drown in.

[Benton D Struckcheon]

6. It would take me about 15 mins to reproduce an analysis I did a few years ago,

of the US's net worth, reconstructed from publicly available data.
The US has a positive net worth, a large one. Note that this is the difference between your assets and your liabilities. The US's assets far exceed its liabilities. Anyone doing that analysis would know instantly that while the US may have many other economic problems, debt isn't one of them.
That's number one.
Number two, arguably GDP can be considered your current income, kinda like the income you get from your job for a year. So think about this for a minute: it's like all your debts, including your car, credit cards, mortgage, student loans, all that stuff, was only equal to 90% of what you make in a year.
Most people carry a lot more debt than that at some point in their lives.

[reformist2]

7. Because it all boils down to this choice: either cut benefits, or raise taxes on the rich - a lot.

[Marr]

8. Say things that media owners want to hear, and your opinions will be broadcast.

It's as simple as that. Ayn Rand was a truly horrible writer who is still getting free PR to this day. Same reason.

[kenny blankenship]

9. Alliteration. A pair of very servere sounding trochees sharing a hyphenated bond.

Think Rigor! Think Rectitude! Think Reinhart-Rogoff.
It's what the verrrry serrrious people are reading.
(Ripped it Right from their own Rectum)

It really doesn't take much to impress that crowd.

[Wellstone ruled]

10. This whole peice of falseism was foisted on the unthinking public

by the likes of Pete Peterson and Wall Street. What was their goal,easy,a two class society. 1%ers and the Bob Crachets.