Monday, February 7, 2011

Donald Marron still doesn't get supply and demand

Here he talks about government involvement in pizza production as an explanation why people buy less pizza when government raises the price of pizza. Except the government does not sell pizza, government sells government goods, like war, massive transfer payments, and huge federal workforces.

According to supply and demand, when government raises the price of its goods, customers buy less of them, government shrinks.  It used to be easy to tell the Senate any delusional story but we have the Internet today. Senators read my blog, and Senators will discover that government does not sell pizzas, government sells the other crap.  The era of Reagan Communist delusion is over, we figured our supply and demand.

Take a look again Morran, Reagan lowered taxes and government grew, Clinton raised them and government shrank, Bush lowered them and government grew, Obama keep rates low  precisely because he knows this and wants to sell more government at a loss.

People get this, Don Morran is delusional.

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