Austrian Economics vs. Keynesian Economics in Axis and Allies


  • Also, when inflation happens, your wages also increase(albeit more slowly).


  • Thanls for the help. I try to learn as much as I can about different topics so I can at least be knowledgable enough to know when someone is BSing me.

    As for the “warfare-welfare” state, I probably agree with you that many wars, which are funded by defecit spending, do not need to be started and that the budget for the military can be cut significantly without much harm. I also think that too much money should not be spent on welfare, but I do want everyone to have a minimum standard of living which, in the current world, welfare seems to give, looking at Western Europe.

    BTW, I’m not sure our discussion is off topic, since we are talking about what the title says. If we do get flagged, it would be for being too political.


  • @calvinhobbesliker:

    I completely agree that you lose purchasing power. However, I’m saying it’s not a “tax” since the government doesn’t gain what you lose. A tax is not just a loss of money; it’s the loss of money to the government.

    BTW, why call it hidden if most people are aware of it?

    How do you think the money inflates? By the government printing money. So the government gets money and the people lose money value (basically money) - a “hidden tax.”


  • @Wilson2:

    @calvinhobbesliker:

    I completely agree that you lose purchasing power. However, I’m saying it’s not a “tax” since the government doesn’t gain what you lose. A tax is not just a loss of money; it’s the loss of money to the government.

    BTW, why call it hidden if most people are aware of it?

    How do you think the money inflates? By the government printing money. So the government gets money and the people lose money value (basically money) - a “hidden tax.”

    I see. I have a question about that though:isn’t inflation proportional to the amount of money in circulation? I.E if the gov’t doubled the nominal value in circulation, the value of the dollar would halve. Doesn’t this mean the government has the same purchasing power as before?


  • Yes - but you are forgetting dollar-denominated debt.

    Most debt (including US Gov’t debt) is held in dollars. By doubling the nominal value, you are in effect halving your debt.


  • The debt isn’t inflation adjusted :-o :-o :-o
    Wow.


  • Hence the phrase, “inflate your way out of debt”

    It is not a pretty sight in the short run (Weimar Republic, Argentina).


  • How do other countries not see this, since the exchange rate is inflation-adjusted?


  • The underlying assumption has been (falsely, in my view) that US Gov’t obligations are “risk-free” for much of the 20th and 21st centuries.

    Heavy inflation is a curse and a blessing. If done properly, it allows payment of foreign debt and cheapens your cost of doing business (labor, etc) relative to other countries, allowing for more export which in turn eventually stabilizes inflation. The curse is that individual people see their bargaining (purchasing) power drop dramatically.


  • Yes, inflation by the Fed is a good tool, IF the government uses it correctly. I presume that you and other Austrians don’t really trust the gov’t to be able to do a good job at that, correct?


  • The problem is not economics, it’s politics. Today we have:

    • Two party system (both in USA and in Europe). That means that alternate ideas that could aid to solve problems cannot reach the government. As the two mayor parties seem the same in economics (again, both in USA and Europe), the truth is that people cannot choose the economic politic
    • Non proportional elections (both in USA and Europe). Is insane that a guy can be elected president with less popular votes than another guy in a presidential system (USA) and is insane that a party can have more representatives that another that got more popular votes (Europe)
    • Discipline of vote (rigid only to Europe) and closed lists (both I think). Representatives are chosen by the party, not by the people, and so they do things that serve to the party and not to the people

    That we need is more democracy, not less as we saw in Greece and Spain (stingy ZP, you traitor). Also, we need control financial power somehow (now it has free reign worldwide). I know the Austrian school a bit and I think they are totally wrong, but we need able politicians first or any solution we try is damned to fail utterly. Current situation only serves to give more power to the powerful (financial power, that has governments as puppets) and less to the common people

    A politics thread (economics = politics ) … interesting indeed but will be closed soon or later


  • I think reps are only chosen by the party in parliamentary systems. In the US, everyone votes for a Rep, a Senator, and the President


  • However, I agree with the rest of what you said. I’d like to add that rich people/corporations are able to bribe polititions, and thus we have a plutocracy instead of a democracy


  • @calvinhobbesliker:

    I think reps are only chosen by the party in parliamentary systems

    That’s true (agreed as well about the bribing and the plutocracy)


  • I think the only way of changing the things is voting any party that is not one of the mayors and better voting one that wants change the electoral system to a more democratic one. That would mean voting any party different to Dems and Reps in USA, any different to PSOE and PP in Spain, any different to laborists and conservatives in UK, etc. That’s the only non-futile vote, and we saw a bit of that in UK (there, a third party won enough representatives to force the conservatives a minor change in the electoral system. Its a small step, but we need start walking as soon as we can)


  • @Funcioneta:

    I think the only way of changing the things is voting any party that is not one of the mayors and better voting one that wants change the electoral system to a more democratic one. That would mean voting any party different to Dems and Reps in USA, any different to PSOE and PP in Spain, any different to laborists and conservatives in UK, etc. That’s the only non-futile vote, and we saw a bit of that in UK (there, a third party won enough representatives to force the conservatives a minor change in the electoral system. Its a small step, but we need start walking as soon as we can)

    What’s PSOE and PP stand for(and English translations, please)

    Yeah, the Lib Dems were key in the UK. However, what’s to prevent a 3rd party from taking bribes?


  • Thaught you guys might like this

    http://www.youtube.com/watch?v=d0nERTFo-Sk


  • @Cromwell_Dude:

    Imagine the look on the face of the Axis player when the US builds a navy with 4 battleships, 3AC, 5 destroyers, 10 subs, and 20 transports, on EACH coast on move 1!  The war is not in doubt now.

    Great economic parody. I hate to be a spoil sport but the US would run into factory build limits in any game but A&A Classic.


  • @Funcioneta:

    but we need able politicians first or any solution we try is damned to fail utterly.

    Ah, the classic argument - we need better people!

    Funcioneta, I agree with many of your points, but you tend to draw the wrong conclusions. Government is corrupt – I agree. Your solution is better politicians, mine is less government. Power corrupts, and the more power granted to one entity the more corruption possible. The beauty of economics is that individual forces acting for themselves bring about that which you want.

    Does government have a role? Of course! We need government for basic services, such as courts, roads, police and fire, etc, and also a limited framework to eliminate monopolies and cartels in business.

    One other point about your “more democracy” comment – I agree we need more “educated democracy.” The problem is a large percentage of voters are apathetic and vote for whatever name they remember best. Also, few people have any idea of economic principles and tend to vote for nice sounding ideas with disastrous consequences.

    I’ll give two examples: Minimum wage and welfare. Minimum wage is a great idea in principle (workers should be paid a “living” wage, sufficient to provide for a family). In practice, however, it leads to massive under-employment. Why? The prime beneficiary of minimum wage jobs is teenagers and college students (over 50% in the US). At a minimum wage job, you learn vital skills and build experience for a “real” job further down the road (historical equivalent – apprentice). When you institute a minimum wage, you condemn many of these youths to no job whatsoever, with disastrous results for the future.

    Welfare is similar – it is a “give a fish” instead of “teach to fish” idea. If all unemployed people are given welfare sufficient to cover their expenses, what incentive is there to work (or build job skills?). Sadly, many people here in the US in their 20’s and 30’s are on welfare, doing nothing and collecting checks from the Government. While this is sustainable in the short term, they are really harming themselves in the long run, as they are supposed to be earning wages and saving during those years so as to pay for their retirement in the future. Such a scheme eventually collapses, with dire results for all (Greece). I draw the parallel of a wild and a captive tiger. A captive tiger, once born and reared in a zoo, can never be released to the wild, as he does not have the requisite skills to survive. The captive tiger is the modern day welfare recipient – would you set them free?


  • For welfare, the incentive to work is to earn more, since unemployment benefits are less I think than MW.

    For MW, I’m not sure that’s empirically true, and I think different studies conflict with each other.

    Less government is all well and good, but of course, we need a gov’t for the military, infrastructure, ans, as some argue, health care, economic crises, and a social saftey net

Suggested Topics

  • 14
  • 1
  • 42
  • 123
  • 3
  • 2
  • 11
  • 3
Axis & Allies Boardgaming Custom Painted Miniatures

43

Online

17.0k

Users

39.3k

Topics

1.7m

Posts