Replies to post #202730 on Tornado Alley (PROG)

[StephanieVanbryce]

And WRONG Tim Giethner & WRONG Barack Obama..

we can thank them for the sequester - NOT NEEDED!
... as those of us smart enough to be reading the RIGHT people along with
reading the WRONG Austerians!... heh. (silversurfer anyone?) (zerohedge?)..HA!

And we can Thank Obama for the C.P.I. that isn't needed as WE also said! ...........AND much more!

http://www.dailykos.com/story/2013/04/24/1204389/-The-Reinhart-and-Rogoff-Errors-Discredit-the-Obama-Administration-and-Austerity

This is complicated.. and difficult ... but PACKED with info AND two youtubes.. charts plus embedded links all over the place .. ;) .....

[StephanieVanbryce]

AND all those poor hungry Greek children!

AUSTERITY doesn't WORK! ..Damn them to HELL for starving the kids AND the parents! for What? ..

............and they were told! history told them! Krugman, Baker, DeLong, Bartlett plus
MORE told them! ... but oh no! .... this time it's different ..BS!

[F6]

The Excel Depression

By PAUL KRUGMAN
Published: April 18, 2013

In this age of information, math errors can lead to disaster. NASA’s Mars Orbiter crashed [ http://www.cnn.com/TECH/space/9909/30/mars.metric.02/ ] because engineers forgot to convert to metric measurements; JPMorgan Chase’s “London Whale” venture went bad [ http://baselinescenario.com/2013/02/09/the-importance-of-excel/ ] in part because modelers divided by a sum instead of an average. So, did an Excel coding error destroy the economies of the Western world?

The story so far: At the beginning of 2010, two Harvard economists, Carmen Reinhart and Kenneth Rogoff, circulated a paper, “Growth in a Time of Debt [ http://www.nber.org/papers/w15639.pdf ],” that purported to identify a critical “threshold,” a tipping point, for government indebtedness. Once debt exceeds 90 percent of gross domestic product, they claimed, economic growth drops off sharply.

Ms. Reinhart and Mr. Rogoff had credibility thanks to a widely admired earlier book on the history of financial crises, and their timing was impeccable. The paper came out just after Greece went into crisis and played right into the desire of many officials to “pivot” from stimulus to austerity. As a result, the paper instantly became famous; it was, and is, surely the most influential economic analysis of recent years.

In fact, Reinhart-Rogoff quickly achieved almost sacred status among self-proclaimed guardians of fiscal responsibility; their tipping-point claim was treated not as a disputed hypothesis but as unquestioned fact. For example, a Washington Post editorial earlier this year warned against any relaxation on the deficit front [ http://www.washingtonpost.com/opinions/debt-reduction-hawks-and-doves/2013/01/26/3089bd52-665a-11e2-93e1-475791032daf_story.html ], because we are “dangerously near the 90 percent mark that economists regard as a threat to sustainable economic growth.” Notice the phrasing: “economists,” not “some economists,” let alone “some economists, vigorously disputed by other economists with equally good credentials,” which was the reality.

For the truth is that Reinhart-Rogoff faced substantial criticism from the start, and the controversy grew over time. As soon as the paper was released, many economists pointed out that a negative correlation between debt and economic performance need not mean that high debt causes low growth. It could just as easily be the other way around, with poor economic performance leading to high debt. Indeed, that’s obviously the case for Japan, which went deep into debt only after its growth collapsed in the early 1990s.

Over time, another problem emerged: Other researchers, using seemingly comparable data on debt and growth, couldn’t replicate the Reinhart-Rogoff results. They typically found some correlation between high debt and slow growth — but nothing that looked like a tipping point at 90 percent or, indeed, any particular level of debt.

Finally, Ms. Reinhart and Mr. Rogoff allowed researchers at the University of Massachusetts [ http://www.peri.umass.edu/236/hash/31e2ff374b6377b2ddec04deaa6388b1/publication/566/ ] to look at their original spreadsheet — and the mystery of the irreproducible results was solved [ http://www.nextnewdeal.net/rortybomb/researchers-finally-replicated-reinhart-rogoff-and-there-are-serious-problems ]. First, they omitted some data; second, they used unusual and highly questionable statistical procedures; and finally, yes, they made an Excel coding error. Correct these oddities and errors, and you get what other researchers have found [ http://www.oecd-ilibrary.org/economics/public-debt-economic-growth-and-nonlinear-effects_5k918xk8d4zn-en ]: some correlation between high debt and slow growth, with no indication of which is causing which, but no sign at all of that 90 percent “threshold.”

In response, Ms. Reinhart and Mr. Rogoff have acknowledged [ http://blogs.ft.com/ftdata/2013/04/17/the-reinhart-rogoff-response-i/ ] the coding error, defended their other decisions and claimed that they never asserted that debt necessarily causes slow growth. That’s a bit disingenuous because they repeatedly insinuated that proposition even if they avoided saying it outright. But, in any case, what really matters isn’t what they meant to say, it’s how their work was read: Austerity enthusiasts trumpeted that supposed 90 percent tipping point as a proven fact and a reason to slash government spending even in the face of mass unemployment.

So the Reinhart-Rogoff fiasco needs to be seen in the broader context of austerity mania: the obviously intense desire of policy makers, politicians and pundits across the Western world to turn their backs on the unemployed and instead use the economic crisis as an excuse to slash social programs.

What the Reinhart-Rogoff affair shows is the extent to which austerity has been sold on false pretenses. For three years, the turn to austerity has been presented not as a choice but as a necessity. Economic research, austerity advocates insisted, showed that terrible things happen once debt exceeds 90 percent of G.D.P. But “economic research” showed no such thing; a couple of economists made that assertion, while many others disagreed. Policy makers abandoned the unemployed and turned to austerity because they wanted to, not because they had to.

So will toppling Reinhart-Rogoff from its pedestal change anything? I’d like to think so. But I predict that the usual suspects will just find another dubious piece of economic analysis to canonize, and the depression will go on and on.

© 2013 The New York Times Company

http://www.nytimes.com/2013/04/19/opinion/krugman-the-excel-depression.html [with comments]


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Austerity may help growth during good times. But man, does it hurt during bad times.
April 18, 2013
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/04/18/austerity-may-help-growth-during-good-times-but-man-does-it-hurt-during-bad-times/ [with comments]


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Did This Excel Error Cause Panic Over Federal Debt?
April 17, 2013
http://wallstcheatsheet.com/stocks/did-this-excel-error-cause-panic-over-federal-debt.html/ [ http://wallstcheatsheet.com/stocks/did-this-excel-error-cause-panic-over-federal-debt.html/?a=viewall ] [with comments]


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Reinhart And Rogoff Make More Mistakes While Admitting To Research Flaws
04/22/2013
http://www.huffingtonpost.com/2013/04/22/reinhart-rogoff-mistakes_n_3133752.html [with comments]


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Who Is Defending Austerity Now?
The Excel error heard 'round the world has deficit-cutters backpedaling
Apr 22 2013
http://www.theatlantic.com/business/archive/2013/04/who-is-defending-austerity-now/275200/ [with comments]


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Why the 'Spreadsheet Scandal' Should Kill Obama's Social Security Cut
04/18/2013
http://www.huffingtonpost.com/rj-eskow/why-the-spreadsheet-scand_b_3110765.html [with comments]


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Greg Mankiw On Reinhart-Rogoff: Hey, Everybody Makes Mistakes
04/24/2013
http://www.huffingtonpost.com/2013/04/24/greg-mankiw-reinhart-rogoff-mistakes_n_3149474.html [with embedded video report, and comments]

[StephanieVanbryce]

More Children in Greece Are Going Hungry


Michalis Petrakis, who is jobless and whose son Pantelis has been going to school
hungry, shows his nearly empty refrigerator.

By LIZ ALDERMAN
Published: April 17, 2013

ATHENS — As an elementary school principal, Leonidas Nikas is used to seeing children play, laugh and dream about the future. But recently he has seen something altogether different, something he thought was impossible in Greece: children picking through school trash cans for food; needy youngsters asking playmates for leftovers; and an 11-year-old boy, Pantelis Petrakis, bent over with hunger pains.

“He had eaten almost nothing at home,” Mr. Nikas said, sitting in his cramped school office near the port of Piraeus, a working-class suburb of Athens, as the sound of a jump rope skittered across the playground. He confronted Pantelis’s parents, who were ashamed and embarrassed but admitted that they had not been able to find work for months. Their savings were gone, and they were living on rations of pasta and ketchup.

“Not in my wildest dreams would I expect to see the situation we are in,” Mr. Nikas said. “We have reached a point where children in Greece are coming to school hungry. Today, families have difficulties not only of employment, but of survival.”

The Greek economy is in free fall, having shrunk by 20 percent in the past five years. The unemployment rate is more than 27 percent, the highest in Europe, and 6 of 10 job seekers say they have not worked in more than a year. Those dry statistics are reshaping the lives of Greek families with children, more of whom are arriving at schools hungry or underfed, even malnourished, according to private groups and the government itself.

Last year, an estimated 10 percent of Greek elementary and middle school students suffered from what public health professionals call “food insecurity,” meaning they faced hunger or the risk of it, said Dr. Athena Linos, a professor at the University of Athens Medical School who also heads a food assistance program at Prolepsis, a nongovernmental public health group that has studied the situation. “When it comes to food insecurity, Greece has now fallen to the level of some African countries,” she said.

Unlike those in the United States, Greek schools do not offer subsidized cafeteria lunches. Students bring their own food or buy items from a canteen. The cost has become insurmountable for some families with little or no income. Their troubles have been compounded by new austerity measures demanded by Greece’s creditors, including higher electricity taxes and cuts in subsidies for large families. As a result, parents without work are seeing their savings and benefits rapidly disappear.

“All around me I hear kids saying: ‘My parents don’t have any money. We don’t know what we are going to do,’ ” said Evangelia Karakaxa, a vivacious 15-year-old at the No. 9 junior high school in Acharnes.

Acharnes, a working-class town among the mountains of Attica, was bustling with activity from imports until the economic crisis wiped out thousands of factory jobs.

Now, several of Evangelia’s classmates are frequently hungry, she said, and one boy recently fainted. Some children were starting to steal for food, she added. While she does not excuse it, she understands their plight. “Those who are well fed will never understand those who are not,” she said.

“Our dreams are crushed,” added Evangelia, whose parents are unemployed but who is not in the same dire situation as her peers. She paused, then continued in a low voice. “They say that when you drown, your life flashes before your eyes. My sense is that in Greece, we are drowning on dry land.”

Alexandra Perri, who works at the school, said that at least 60 of the 280 students suffered from malnutrition. Children who once boasted of sweets and meat now talk of eating boiled macaroni, lentils, rice or potatoes. “The cheapest stuff,” Ms. Perri said.

This year the number of malnutrition cases jumped. “A year ago, it wasn’t like this,” Ms. Perri, said, fighting back tears. “What’s frightening is the speed at which it is happening.”

The government, which initially dismissed the reports as exaggerations, recently acknowledged that it needed to tackle the issue of malnutrition in schools. But with priorities placed on repaying bailout funds, there is little money in Greek coffers to cope.

Mr. Nikas, the principal, said he knew that the Greek government was laboring to fix the economy. Now that talk of Greece’s exiting the euro zone has disappeared, things look better to the outside world. “But tell that to the family of Pantelis,” he said. “They don’t feel the improvement in their lives.”

In the family’s darkened apartment near the school, Themelina Petrakis, Pantelis’s mother, opened her refrigerator and cupboards one recent weekend. Inside was little more than a few bottles of ketchup and other condiments, some macaroni and leftovers from a meal she had gotten from the town hall.

The family was doing well and was even helping others in need until last year. The Petrakises were able to afford a spacious apartment with a flat-screen TV and a PlayStation.

Then her husband, Michalis, 41, was laid off from his shipping job in December. He said the company had not paid his wages for five months before that. The couple could no longer afford rent, and by February they had run out of money.

“When the principal called, I had to tell him, ‘We don’t have food,’ ” said Ms. Petrakis, 36, cradling Pantelis’s head as he cast his eyes to the ground.

Mr. Petrakis said he felt emasculated after repeatedly failing to find new work. When food for the family ran low, he stopped eating almost entirely, and rapidly lost weight.

“When I was working last summer, I even threw away excess bread,” he said, tears streaming down his face. “Now, I sit here with a war running through my head, trying to figure out how we will live.”

When the hunger comes, Ms. Petrakis has a solution. “It’s simple,” she said. “You get hungry, you get dizzy and you sleep it off.”

A 2012 Unicef report showed that among the poorest Greek households with children, more than 26 percent had an “economically weak diet.” The phenomenon has hit immigrants hardest but is spreading quickly among Greeks in urban areas where one or both parents are effectively permanently unemployed.

In rural areas, people can at least grow food. But that is not enough to eradicate the problem. An hour’s drive northwest of Athens, in the industrial town of Asproprigos, Nicos Tsoufar, 42, stared vacantly ahead as he sat in the middle school that his three children attend. The school receives lunches from a program run by Prolepsis, the public health group. Mr. Tsoufar said his children desperately needed the meals.

He has not found work for three years. Now, he said, his family is living on what he called a “cabbage-based diet,” which it supplements by foraging for snails in nearby fields. “I know you can’t cover nutritional basics with cabbage,” he said bitterly. “But there’s no alternative.”

The government and groups like Prolepsis are doing what they can. Last year, Prolepsis started a pilot program providing a sandwich, fruit and milk at 34 public schools where more than half of the 6,400 families participating said they had experienced “medium to serious hunger.”

After the program, that percentage dropped to 41 percent. Financed by an $8 million grant from the Stavros Niarchos Foundation, an international philanthropic organization, the program was expanded this year to cover 20,000 children at 120 schools.

Konstantinos Arvanitopoulos, Greece’s education minister, said the government had secured European Union financing to provide fruit and milk in schools, and vouchers for bread and cheese. It is also working with the Greek Orthodox Church to provide thousands of care packages. “It is the least we can do in this difficult financial circumstance,” he said.

Mr. Nikas, the principal at 11-year-old Pantelis’s school, has taken matters into his own hands and is organizing food drives at the school. He is angry at what he sees as broader neglect of Greece’s troubles by Europe.

“I’m not saying we should just wait for others to help us,” he said. “But unless the European Union acts like this school, where families help other families because we’re one big family, we’re done for.”

Dimitris Bounias contributed reporting.

http://www.nytimes.com/2013/04/18/world/europe/more-children-in-greece-start-to-go-hungry.html?hp&_r=2&;

Greece on the breadline: the children of Athens too hungry to do PE

http://www.guardian.co.uk/world/blog/2012/mar/13/greece-breadline-hungry-children-pe

SERIES - Greece on the breadline

http://www.guardian.co.uk/world/series/greece-on-the-breadline

If anyone damn cares! ... sickening! Angele Merkel, imf, international monetary fund NEED to go to HELL and just STAY STARVING there .. ALL the DAMN TIME!

[SOROS]

If You Think Disaster Is Good For the Economy, You Might Be a Keynesian

Paul Krugman is famous for saying that if space aliens were to attack the planet, it would be great for the economy. He says that any temporary deficit spending, no matter how productive, is good for the economy and would “bring us out,” of economic recession.

I hate treating Krugman like a sane person, but on the surface, it seems tenable. More spending, for an ostensibly good cause increases productivity and may seem like a good thing for the economy. If that were so, then disasters like Haiti’s earthquake or hurricane Katrina or even the Boston Marathon bombing would be good for the economy.

But this Nobel Prize winner is stuck in grade-school economics here. Krugman consistently falls for the broken window fallacy, which states that if a man comes along and breaks a baker’s window, it’s good for the economy because that employs a glazier to repair the window. Voila: more employment. But it’s a fallacy because, while we see what has been created (glazier employment), we don’t see what could have been created: an extra bread oven, donations to the poor, a new wardrobe for the baker’s staff. Instead of having all those things AND a window, because of the vandal (the disaster), the baker can only have a window.

Not realizing that there are costs in disaster is so ridiculous, it almost doesn’t deserve to be acknowledged, but people still listen to Keynesians, so, their idiocy must be repudiated constantly.

Interested in these ideas? Check out: Juggernaut: Why the System Crushes the Only People Who Can Save It

http://code-interactive.com/ad-in/2013/04/if-you-think-disaster-is-good-for-the-economy-you-might-be-a-keynesian/