Inability to fill appointed positions

[Beavah]

Yah, hmmm...

 

So today I see that da minority party in the Senate has again misused da filibuster threat to derail a nomination, this time to the Federal Reserve board. Both the Democrats and the Republicans have misused the filibuster in this way for nuthin' more than obstructionism and I really wish both parties would stop.

 

Now I'm not completely familiar with Peter Diamond or his work, but by and large I think it would be nice to have a Nobel Prize-winning economist on the Fed. I can't say that I agree with the fellow philosophically as he clearly comes from left-of-center, but that's just ordinary when the Executive doin' the appointing is left of center. It's to be expected, and it's fine. It's da way the nation works. Certainly it's far preferable to having one more fellow from Goldman-Sachs or the damnable banking lobby on the Fed. I reckon that perspective is well-covered.

 

Yah, yah, I get that Congress prefers mediocrity. It's so much easier to play the bigwig when yeh surround yourself with yes-men and lightweights. But da folks who I want appointed to fill important roles in the government are smart people, eh? People who know more than I do, and certainly who know more than Congress does. I want professionals, and I don't much care what their philosophy is, so long as they are professional.

 

Why has it become impossible to appoint professionals to professional positions in da government?

 

Beavah

 

 

[perdidochas]

I agree that pretty much the Senate should put nominees up to a vote. Filibustering should be reserved for cases where legislation needs to be looked at closer before passing.

 

However, having dealt with very smart people (and being one myself), I'm not certain I want them running things. I want them giving advice and input, but not necessarily making the decisions.

[NJCubScouter]

The nominee himself wrote an interesting and sometimes humorous essay in the New York Times today, explaining his withdrawal and criticizing the system (much as Beavah does.) It is entitled "When a Nobel Prize Isn't Enough." Among other things, he says he is satisfied to go back to teaching at MIT. (I just mentioned that in case anyone thought he taught somewhere that has a good reputation.) Evidently Senator Shelby (Alabama) didn't think Dr. Diamond's Nobel Prize was in the right sub-sub-specialty of economics. Here is a link to the article but it might tell you you have to pay something: http://www.nytimes.com/2011/06/06/opinion/06diamond.html?_r=1&hp

 

I also looked at Peter Diamond's article on Wikipedia and found this sentence interesting: "Ben Bernanke, the current Chairman of the Fed, was once a student of Diamond." Think about THAT for a minute. He taught the current Fed chairman -- in fact he was one of the reviewers of Bernanke's doctoral dissertation -- but he doesn't have the "right experience" to serve under Bernanke at the Fed. Priceless.

[Beavah]

However, having dealt with very smart people (and being one myself), I'm not certain I want them running things. I want them giving advice and input, but not necessarily making the decisions.

 

Yah, it's much better for da nation to have dumb people makin' the decisions, eh? That way everyone feels justified talkin' about just how moronic the decisions are.

 

Da Federal Reserve Board is a board, eh? A deliberative body. It makes decisions as a group, not as individuals. And da decisions it deals with are complex ones which require expertise but are not time-sensitive. Yeh don't want a "leader" type like a general makin' monetary decisions. Yeh want intelligence, collaboration, and above all independence from the politicians.

 

Beavah

 

[shortridge]

And here I thought this was going to be about an SPL who wasn't able to appoint his ASPL, QM, TGs, etc.

[NJCubScouter]

shortridge, I think that would have been under "Open Discussion - Program." It's just down the hall.

[BS-87]

I say we don't need any more Keynesians on the FED board.

 

We could probably use some appointments with folks more philosophically aligned with Austrian Economics. If we'd have had folks in there who recognized how quantitative easing is only exacerbating the difficulties in our economy and building us up for the biggest bubble burst yet (the dollar bubble...) we could have avoided the past bubble bursts like the housing bubble which led to banking bailouts (over 80% of which went to foreign banks) and the very soon up and coming education bubble.

 

Let's get some Hayek thinking folks who aren't pompous enough to believe a central bank monkeying with the money supply and multipliers can effect private industry lagging indicators like unemployment.

[Beavah]

Yah, that's what I'm talkin' about, BS-87.

 

It's not enough to be an expert in a field, eh? Yeh have to pass a philosophy litmus test.

 

No difference between that and a religious litmus test.

 

What we want are experts in da field doin' work for us. When yeh need to build a bridge, yeh hire a civil engineer and a construction crew that's good at building bridges. Yeh don't make da engineer swear his loyalty to the current philosophical fad of the day, or refuse to consider the best engineer because some dumbass who knows nothing whatsoever about engineering disagrees with da fellow's philosophy. When yeh do that, yeh get bridges that cost twice as much and have to be repaired after 5 years.

 

No different here. This fellow was a renowned expert on economics, with a particular specialty in systemic unemployment. What do we have in da U.S. right now? Systemic unemployment.

 

We do the nation a profound disservice when we don't hire the best people for the job because our politicians want the civil service to be philosophically cleansed, or otherwise filled with "yes-men". That's just what we need, eh? One life-long politician senator who never held a real job insisting that da folks who serve in the most important positions of economic oversight in the nation agree with his philosophy.

 

Used to be the folks who believed in liberty and conservative approaches to governance understood that.

 

The nominee should go for a vote of the full senate. Individual senators do not have a constitutional prerogative to block a nomination anytime they don't like a person's philosophy, or the way he looks, or who his grandparents were.

 

Beavah

(This message has been edited by Beavah)

[BS-87]

Beavah - You'd be right if economics was like religion.

 

It turns out theoretical institutions like the Keynesians are perpetuating the problems we have and that leads me to believe anyone who aspires to that school of thought would only continue feeding the problem. As it so happens, part of the problem with the FED is they have the audacity to think their short term fixes make for sustainable policy. They are just plain wrong in thinking they can create a healthy economy by artificially creating jobs or printing money by creating debt and devaluing the dollar (which is an apathy tax on every single American rich and poor).

 

I'm sure this guy is great at playing with numbers in a vacuum or limited experiment, but I know with absolute certainty that any Keynesian economist will only perpetuate our current problems.

[Engineer61]

I use Statistics and Economics interchangeably....

 

There are lies, damn lies and Economics.

 

 

[Beavah]

I'm sure this guy is great at playing with numbers in a vacuum or limited experiment, but I know with absolute certainty that any Keynesian economist will only perpetuate our current problems.

 

And how do yeh know that, pray tell?

 

Right now we're admittedly conductin' a big uncontrolled experiment with da economy. Have been since 2008. Anybody who claims to know anything with absolute certainty is just foolin' themselves. Yep, yeh might think that Fed action would lead to inflation under ordinary circumstances, but inflation also requires high employment, which we don't have. Yah, yeh might think that it might devalue the dollar, except there's no alternative. The Euro? The Yen? Yeh must be jokin'. And it's also perfectly natural for a currency that's running a large current account deficit to devalue, which improves domestic manufacturing.

 

Yah, yeh would think that under ordinary circumstances these fed tricks and TARP would be preposterous, and they sure make all of us angry. But then, under ordinary circumstances da events of 2008 would have led to cascading bank failures and a worldwide Great Depression 2. It still amazes me that didn't happen. Remember, we were on da gold standard and non-Keynsians in da 1930s. How'd that work out by comparison?

 

Under ordinary circumstances the stimulus would be outrageous, eh? But right now we're seein' most states in the country in budget messes and cutting thousands of jobs because the stimulus has run out. On its own right now it's enough to cause political turmoil and stall the economy. Imagine if those budget messes and job cuts had come two years earlier, at the worst part of the crash.

 

Expertise is expertise. Yah, it isn't always right, and there's a lot to fault in da Federal Reserve, especially under the previous chairman in his last decade. But expertise is a darn sight better than ignorance.

 

So BS-87, do you believe it's constitutionally sound to allow single senators from da minority party to (often anonymously) block appointments for any reason they choose? Or does "advice and consent" of the Senate mean that they should discuss and vote?

 

Beavah

[BS-87]

"Yah, yeh would think that under ordinary circumstances these fed tricks and TARP would be preposterous, and they sure make all of us angry. But then, under ordinary circumstances da events of 2008 would have led to cascading bank failures and a worldwide Great Depression 2. It still amazes me that didn't happen. Remember, we were on da gold standard and non-Keynsians in da 1930s. How'd that work out by comparison?"

 

Between TARP and quantitative easing, it's become quite evident Bernanke is determined not to be the Fed Chairman who presided over the second Great Depression. The cost is that he will be the Fed Chairman who presides over the greatest rate of inflation and worst employment picture our nation has ever experienced. The way unemployment is measured today is almost criminal, because it vastly understates real unemployment. When someone loses their job today, they're staying unemployed even longer than during the Great Depression! The figures today don't even count these folks because they are assumed to have given up any hope of ever being employed again!

 

There are kids leaving college right now who are realizing just how dim the employment picture is. The problem is systemic, and unless this nominee believes that the systemic problem is the Fed's meddling in and of itself, he will only contribute more to the problem. Inflation is not tied to employment as you suggested Beavah, it's tied to the money supply. What's appalling is that the debt ceiling has been skyrocketing and the Fed has been printing money and loaning money which increases the money supply and decreases the value of our money. Gas used to be worth $1/ gallon, today it is worth $4/gallon. This is not because gas is in any different supply or demand, this is because $4 today is worth what $1 was then! This is an outrageous tax on every single American who has their wealth invested in Federal Reserve Notes.

 

The gold standard was not a cause of the Great Depression. What played a larger role in the Great Depression was the Central Bank, the FED! Because of the same policies that are used today in playing with interest rates, investment was made through debt and the money multiplier effect was shown to be the theoretical mess it really is. It looks great on paper and sounds good but creates the potential for bank runs and market crashes. What the Fed realized they have to do to prevent another Great Depression is devalue the currency, and they can only do that when the money is not tied to gold or silver or other standard of value. A Central Bank can only devalue currency and obliterate wealth effectively transferring all wealth from the private sector to the federal government when the Central Bank controls and monopolizes a fiat currency.

 

Keynesian meddling with markets is the current problem bankrupting us.

 

Laissez-faire Central Banking leads to Depressions.

 

The only true answer to the problem altogether is to quit this hundred years experiment with Central Banking and return to the gold standard.

 

I don't really support anyone being appointed to the FED I guess is the best way to put it. I support ending the FED all together!

 

 

Edited to answer your question: It is not constitutional to allow a Senator to filibuster anonymously. Make him actually filibuster. That is constitutional and the parties are welcome to do that, including when debating appointments.(This message has been edited by BS-87)

[Beavah]

Yah, hmmm... thanks for the answer to da question. I agree with yeh, and that was the real point of this thread.

 

As for da economics, your thinkin' seems to be a bit muddled there, eh? The 1930s fed did the opposite of what the current fed is doin', not the same thing. You're completely right that we're vastly underestimating unemployment right now and completely wrong to believe that a slack labor market doesn't have a major impact on inflation. If wages are stable or shrinking because of a large labor supply, price inflation can't occur because there's no one who can afford to buy, eh? You're right that the federal debt is increasing, which is bad, but then yeh should be relieved by monetizing because that means the real value of the debt isn't increasing as fast. The alternative, raising taxes so as to actually pay for things like wars would be better. You're completely wrong that the supply-demand picture on oil hasn't changed. Supply has been stagnant, extraction costs have increased, and demand by growing emerging markets around the world has accelerated. But you're right that a component of oil prices is currency-based, and that should make yeh happy, eh? That's the natural result of a trade deficit caused by oil, and is the way the free market acts to encourage domestic production and higher efficiency.

 

In short, yeh seem to have a lot of right general thoughts but wrong details.

 

The Fed prevented Great Depression 2 by printing money, eh? We agree with that. Yeh avoid deflation by makin' it as disadvantageous as possible to stuff money in your mattress. But as you say, they couldn't have done that with a gold standard. Which means that we would have had worldwide Great Depression 2, just da way the 1930s Fed on the gold standard did.

 

So how is that a good thing?

 

Right now, Greece is on da Euro, eh? Much like the gold standard, it means Greece can't devalue its currency. How's that workin' out for them? The government is in bankruptcy, unemployment is at depression levels, and civil unrest is multiplying. IMF-imposed government austerity has acted as a multiplier to make things worse, not better. Cutting government spending has decreased investment and devastated employment. That's what you're prescribing for da U.S.? Really?

 

Now, I do agree with yeh that the lack of regulation which allowed excessive margin (directly or through derivatives) was the primary cause of both crashes. We allowed bankers, funds, and businesses to gamble with other people's money believing that gamblers can "self regulate." So da first lesson we should re-learn is that regulation is necessary, as are legal firewalls between higher risk investment banks/funds and mortgage/depository banks. We haven't learned that yet, because the bank gambling lobby bought the Republican Party and the Democrats never met a 5 page regulation that they couldn't turn into 5000 pages with 10,000 special interest loopholes.

 

I agree with yeh that the fed by loose monetary policy contributed to the 2008 debacle, and to several of the bubbles before that. So I agree there's merit to da notion that the role of the fed should be focused/limited, as it once was, to monetary stability. Rates should generally be set more transparently accordin' to differential bond yields, not pushed by political considerations. That's what I think the "gold standard" folks are really advocatin'. At the same time, the past 40 years overall have been remarkably stable compared to the pre-fed history, eh?

 

Problem is that the gold bugs have chosen da wrong standard. The supply of gold no longer grows at the same rate as economic production. It hasn't since da early 1900s. That's why everyone had to move off the gold standard, eh? It creates a deflationary currency, which is not economically healthy because it discourages investment and growth. So while limiting the political influence on the fed is a good thing, and limiting the fed's role to monetary stability might be a good thing most of the time, and perhaps even tying the dollar to a standard of sorts has merits, the gold standard is impossible unless yeh want da U.S. to be an economic backwater.

 

That's the danger of fellows like Ron Paul who are physicians and not economists, eh? They can be right about general principles, but because they lack expertise they can be absolutely dead wrong and dangerous when it comes to particulars. And if yeh don't value real knowledge and expertise, yeh can follow such a fellow whose general principles are good right off a cliff.

 

Beavah

 

(This message has been edited by Beavah)

[CalicoPenn]

Yeah - about that Gold Standard. The Great Depression was mostly spread worldwide because of the rigidity of the Gold Standard. When countries abandoned the Gold Standard, their recoveries were jump started. The earlier a country abandoned the Gold Standard, the earlier they began to recover. The Gold Standard was a significant factor in the downturn in the Great Depression era and abandoning the Gold Standard was a siginificant factor in the recovery of the economy.

 

Interestingly, countries that were on the Silver Standard avoided the Great Depression.

 

Let's not return to the Gold Standard - it's already been shown it is a hindrance and not a help.

 

We conducted an experiment with our economy for around 30 years starting with the Reagan presidency - and it brought us to the brink of another Great Depression. Let's not go backwards to that failed experiment. It's time to move forward.

 

Shelby should never have been allowed to derail this nomination - Unless there is a demonstrably provable history of criminality and malfeasance in a candidate, a President - ANY President, should have his nominees approved by the Senate without making a political game of it.

[BS-87]

Beavah - The problem here is that we put value in two different things.

 

The FED does a great job of maintaining the status quo and propping up our government.

 

However, I do not value the bloated system of government we currently have. I'm a little more federalist and would much rather see the kind of spending and taxing going on at the federal level be pushed down to the individual states.

 

I understand that social responsibility and compulsory taxation are what make our current society possible and that we would not be the nation we are today without the infrastructure a strong federal presence has granted us.

 

However, the majority of the country agrees with me in saying that our government is doing too much and needs to shrink. The very fact that they cannot afford their own budget spending every year is evidence of this. The result is that we're buried in a debt none of us will see resolved in our lifetimes.

 

The FED is unnecessary. Government was able to fund itself through excise fees, tarriffs, etc. with no income tax for most of our history. For them to be borrowing dollar for dollar with revenue is absurd! People in this country used to vote for federal projects and expansions with their pocketbooks and buy US Bonds themselves. The FED is enabling a grotesque form of government that most Americans today are not satisfied with, but are kept fat and happy enough by to resist revolt.

 

You may hold the status quo on a pedestal all you want, but it's a populist horrific far-cry from the country we were intended to be. We become less American with each passing day as we become as well-sated as the folks in WALL-E (great movie I'd suggest for any Scout function)

 

We may have avoided a Great Depression II, but we've inherited something far worse. We've inherited a system that is not entirely sustainable in the long term and have gone down the road of borrowing our way into poverty. The debt is climbing faster than the FED can devalue the currency. Our dollar will come to the point where it needs to devalue drastically in one fell swoop, instantly cutting the wealth of every American down to a mere fraction of what they currently have. The real tragedy is that it will be an instant transfer to pay the debts of our nation.

 

The debt and unfunded liabilities of our government hang to the tune of $500,000 per household. The time will come when that debt will need to be called and every single American will lose wealth until that figure is paid. Could your family afford to give up $100,000 of wealth TODAY?

 

The real crisis is not employment. The real crisis is not oil.

 

The REAL crisis is what is going to happen to the US dollar...