Sandwichman — Making Sense of Brad DeLong's "Making Say's Law True in Practice"

Mark Thoma at Economist's View links to Brad DeLong's post Making Sense of Friedrich A. von Hayek in which DeLong once again reiterates his bizarre notion about "making Say's Law true in practice although it is false in theory." "Say's Law" (which is neither Say's nor a law!) is not even false in theory -- it is self-contradictory nonsense -- a "liar's paradox. 

Making Say's Law "true in practice" is not consistent with Keynes's critique of the vulgar classical notion that "supply creates its own demand."….

Lump of labor fallacy, Say's law, wages-fund fallacy, and zombie economics, couched in a running debate between Sandwichman and Brad DeLong.

EconoSpeak
Making Sense of Brad DeLong's "Making Say's Law True in Practice"
Sandwichman

William Greider — Sneak Attack on Social Security

The newspapers say the Congressional supercommittee is stalemated on how to reduce the federal deficits, but Democrats and Republicans already agree on one thing. Both parties want to whack Social Security, hoping the old folks won’t notice. Some policy wonks have shown the politicians a sly way to shrink Social Security benefits and call it a “technical fix.” By changing the formula for calculating the annual cost-of-living increases that beneficiaries normally receive, small differences add up to big pain for old folks. The same adjusted formula would be applied to disability benefits and military and veteran pensions.

The beauty of this gimmick is that it looks trivial at first and most people probably wouldn’t notice. But the impact compounds every year afterwards. The personal loss gets larger and larger the longer retired people live on. The Congressional Budget Office calculates savings for government of $217 billion over ten years, barely a scratch in a federal budget of $13 trillion.

But the ugly part of this gimmick is that it punishes most severely the very people who most need help—the lame and the halt and the poor. In the austerity hysteria that grips Washington, that has been a standard approach to deciding who accept sacrifices. If someone must lose, the poor are an easy target—a lot easier than raising taxes on the affluent and super-rich or whacking away at the bloat and waste at the Pentagon.

In the first year of this fix, Social Security recipients at retirement age would lose only about $100 in expected benefits. Ten years later, they would be losing $560 a year. If they are fortunate enough to be alive in their 90s, they would lose $1,400 a year or 9.2 percent of their Social Security check. This is perverse public policy—the older people get the more they will need for medical expenses and the more income they must sacrifice to please the budget cutters.

Read the rest at The Nation

'Technical Fix' for Social Security Will Shrink Benefits to the Poor
by William Greider

Yet another ploy to reduce aggregate demand on the backs of those that can least afford it. These people seem hell-bent on shrinking the economy by creating pain and a growing underclass.