Re: Number Three.

I agree, the historical comparison is spurious.

However, I noticed the Invasion of Iraq on the historical reference side. Might that be a relevant metric? We've been complaining about the staggering cost of the war for 6-ish years.

Yeah, that graphic is astonishingly misleading, as anybody with a grasp of history could attest when seeing where the New Deal ranked.

I think Garmr has a good point. The difference is that the Iraq war spending didn't have to happen at all. We 100% chose to go to war. That's different from the bailout and the stimulus package -- people disagree on the size, direction and details, but nobody serious thinks the government needed to sit on the sidelines.

Re: Number Two.

Can we "accurately assess" the effect of any single economic "input" when we can neither isolate a singular economy, nor compare any one economy to an identical economy sans said "input"?

Can economics be a science?

Mr. Guapo's point on Iraq perfectly expresses my view of the war. It was a discretionary war and, if we were going to spend that amount anyway, I would have preferred that it be spent in the US improving our infrastructure or educational systems.

I think it is possible to analyze the effect of economic intervention. For example, Sweden's response to its bank crisis was successful (pre-current crisis analysis) and the Japanese model was a failure.

Garmr: It's a dismal science, but it's a science. There's admittedly a massive amount of guesswork, but the broad brushes are there. At the beginning of the Great Depression, the government slashed spending and erected trade barriers. Both turned out to be Very Bad, In Capital Letters. Trade figure, balance of accounts figures and monetary supply figures all support those points.

Forgive me my hubris, but I think modern economics are comparable to medieval alchemy: a proto-science burdened by myths and half-truths. I'm weary of suited hermeticists explaining the arcane mechanisms of an effervescent economy which they created.

Regarding the discretionary war point:

I disagree somewhat with hellx's take on it. I would draw an analogy to a homeowner with a big tree that was damaged in a storm, leaning precariously over the house. Even if the homeowner is living at the edge of his means, with no money to spare, he still needs to pay someone to take care of the tree because otherwise he'll lose his house. That isn't money he "was going to spend anyway," it's pulling out the credit cards to stave off disaster.

The core problem is determining whether disaster is impending or imaginary, and I think the US got it wrong in Iraq. It'll be nice when the National Guard can go back to guarding our nation instead of someone else's.

You can't compare economists and doctors, Garmr, for the simple reason that economists' job is to predict the future. That means some will always be wrong. But when you look back, a number of people were absolutely right. Paul Krugman did it with Japan, saying in the 1980s it would never amount to anything despite all the "Japan takes over the world" crap of the day, and a smart economist in 1995 charted out to me exactly what happened with the oil price surge of 2004-2008.

Thinman, not sure I get your point. The analogy for the Gulf War isn't a house threatened by a damaged tree, but a homeowner building a detached garage on a self-limited budget and a lack of electrical wiring between the two structures, for the purpose of protecting a Mercedes he ends up not buying.

I'm not comparing economists with doctors; I'm comparing economists with fledgling chemists who blended faith with reason.

That said, the more I've chewed this comparison in my head all afternoon, the more I think economics is simply an art. Like history, politics, philosophy, literature or religion, it's a product of the human mind, a forest projected upon unassociated trees.

I don't think I made my main point as clearly as I wanted. Hellx suggested that the money for the war would have been more usefully spent on domestic causes, but that presupposes that we were destined to spend the money in the first place.

The war was pitched to the US as a necessity, and in the face of necessity you start writing checks, even if they're on credit. That doesn't mean that, absent of that necessity, the same money would have been spent in other ways. It wouldn't have been spent at all.

So then it turns out (or was assumed all along by most of us) that the whole necessity thing was a line of BS designed for a whole variety of purposes, none of which have much to do with the betterment of Americans or its society. Sucks to be us.

It would be nice if someone could convince a majority of the American people that things like education and general domestic stability and well-being are at least as necessary as the Iraq conflict, but I don't suppose it'll be any time soon.

The war was presented as a necessity, but there were a lot of us with a healthy skepticism of its actual necessity. It was never clear why we had to invade Iraq when the low cost sanction route seemed to be working.

I recognize the fact that without the war we wouldn't have necessarily spent the money, but I'm basically just saying I would have preferred spending the money here rather than there.

I think that we need to draw a distinction between people who work in finance and economists. People who work in finance or Wall Street often try to protray themselves as "artists" or having some sort of special or mystical insight into economics and that is the reason for their success instead of blind luck.

Economists, however, are serious scientists. I don't see garmr arguing the physicists aren't scientists because they can't resolve the differences between newtonian and quantum physics. Economic models are incredibly consistent and are are very good predictors at the micro-economic and macro-economic level up to a point, but the global economy is so incredibly complex that it is impossible to 100% accurately predict the effect the result of the interaction of various economic activities.

I don't dispute that faith or beliefs, at some point, affect the predictions of economists, but that's because we're human and we can only process things through our human brain. We can never be free of our biases and these biases are even present in "hard" scientists.

Personally, I would argue that economics is different from art, literature and history in that these are uniquely human activities whereas non-human primates engage in economic behavior. Unfortunately, I can't find a free version of this article and I don't want to copy and paste it, but the author basically finds that human hunter-gatherers and non-human primates basically engage in the same economic activity. It's ther esult of our being social animals.