Governing through Reason
Rapping the Stimulus
Arguably, the two leading western economists of the twentieth century were F.A. Hayek and John Maynard Keynes. Hayek championed free markets and Keynes provided the intellectual foundation for progressive government attempts to fine tune the economy.
Keynes is best known for his theory that government spending creates demand for goods and services which in turn increases GDP and jobs. Obama placed the Keynes strategy on steroids with roughly $4 trillion in federal government borrowing and spending since taking the office of President. Hayek ridiculed the idea that the government can create economic growth by taking money from one part of the economy, taking a slice for itself and then spending the remaining on goods and services the people are not demanding.
The group Econ Stories tries to make this all accessible to the layperson in a series of videos where actors playing Keynes and Hayek are rapping about their contrasting economic theories. In the second of the series, Hayek and Keynes debate the Obama stimulus. Enjoy.
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#2 written by Jean 1 year ago
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Obama placed the Keynes strategy on steroids with roughly $4 trillion in federal government borrowing and spending since taking the office of President.
It would be nice if even just once you presented this honestly. You’ve been corrected on it more times than I can count.
Then again, your continued misrepresentation sets reader expectations. We don’ thave to wonder whether the rest of your article is honest.
Hayek ridiculed the idea that the government can create economic growth by taking money from one part of the economy, taking a slice for itself and then spending the remaining on goods and services the people are not demanding.
Is this an accurate representation of Hayek’s characterization of Keynes? If so, then Hayek clearly has the same problem with falsely presenting fact that you do, and readers shouldn’t bother with him.
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#5 written by Mainer 1 year ago
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DC:
How much do you claim Obama borrowed from 2Q 2009 to present?
Let me do the math for you.
President Bush’s submitted FY 2009 budget requested $3.1 T.
The Dem Congress never enacted the FY2009 budget until after the election so the voters could not see what they planned.
Obama and Dems raised the FY2009 sending by $400 billion to $3.5 T when Congress finally enacted a budget during early 2009.
FY2009 budget deficit = $1.42 T
To calculate Bush’s share of the FY2009 borrowing, reduce it by the $400 billion in added Dem spending and then take 1⁄4 of the remainder for the quarter spent at the end of the Bush Administration.
Bush’s share of the FY 2009 deficit is about $255 B.
Obama share of the FY 2009 deficit is about $1.145
FY2010 deficit = $1.29 T
FY2011 deficit = $1.64 T (est.)
Total Obama deficit through FY 2011 = $4.075 TRILLION.
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#7 written by Jean 1 year ago
Bart, instead of looking at borrowing, let’s look at results.
A White House report released Friday said the 2009 stimulus bill raised GDP by as much as 3.2 percent in the first quarter of 2011.
The report from the White House Council of Economic Advisers said the stimulus added 2.3 to 3.2 percent to gross domestic product in the first quarter relative to what it otherwise would have been.
The stimulus package also increased employment relative to what it otherwise would have been by between 2.4 and 3.6 million jobs, the report said.
Reading the report, there’s no apparent effort to fudge the data or exaggerate the results. It’s simply a summary of what the Recovery Act did and the extent to which it worked.
And “worked” is the key word here. Economic growth in the first quarter of 2011 (January through March) was quite meager at 1.9%. But the key point to keep in mind here is that without the stimulus, economic growth wouldn’t have existed at all, and the economy would have contracted.
In all, there are as many as 3.6 million Americans with jobs today who wouldn’t have otherwise had them were it not for the stimulus.
Facing the greatest economic crisis in generations, the nation was effectively left with two choices early 2009: the Democratic stimulus or the Republicans’ proposed five-year spending freeze.
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Bart,
1) Your tortured logic on who gets the blame for what part of the FY2009 budget is truly stunning. A masterpiece of fantasy. Bravo!
2) You claim all that deficit, plus the deficits from FY2010 and FY2011, was all spent on Keynsian stimulus. You know better. You’re not even cute when you’re intentionally stupid.
3) You’re omitting that almost all the TARP funds, plus almost all the loans to the auto industry, have been paid back, with interest.
4) You’re also omitting that nearly all of the deficit from FY2010 and FY2011 is due to a) the Bush tax cuts, b) the continuing Bush wars, c) interest on the Reagan/Bush debt, and d) reduced tax revenues from the Bush recession.
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Jean:
Bart, instead of looking at borrowing, let’s look at results.
A White House report released Friday said the 2009 stimulus bill raised GDP by as much as 3.2 percent in the first quarter of 2011.
The report from the White House Council of Economic Advisers said the stimulus added 2.3 to 3.2 percent to gross domestic product in the first quarter relative to what it otherwise would have been.
The stimulus package also increased employment relative to what it otherwise would have been by between 2.4 and 3.6 million jobs, the report said.A White House report? Can you say self-serving electioneering?
As I noted here in May, the ongoing Obama Great Recession is by far the worst “recovery” among all post WWII recessions, none of which employed a Keynesian spending “stimulus” as did Obama. Team Obama’s numbers of GDP and employment “saved” are pure fiction.
I explore this failure in greater detail in my next article on July 9.
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dcpetterson:
2) You claim all that deficit, plus the deficits from FY2010 and FY2011, was all spent on Keynsian stimulus. You know better. You’re not even cute when you’re intentionally stupid.Obama and his economic team’s definition of stimulus is government borrowing and purchasing.
3) You’re omitting that almost all the TARP funds, plus almost all the loans to the auto industry, have been paid back, with interest.
Bush’s part of the TARP spending were loans to banks and the automakers. This part of the deficit has been largely repaid. In contrast, Obama used TARP to buy auto companies and sink hundreds of billions into Freddie and Fannie rather than sending them into bankruptcy. So Bush’ share of the deficit should actually be lower.
4) You’re also omitting that nearly all of the deficit from FY2010 and FY2011 is due to a) the Bush tax cuts, b) the continuing Bush wars, c) interest on the Reagan/Bush debt, and d) reduced tax revenues from the Bush recession.
Only in your fantasies. Until the Dem subprime crash, tax revenues were rising and the deficit was falling to less than half a trillion.
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DC:
[The 14th Amendment’s Public Debt Clause] seems to provide all the support the President would need. Con gress does not have the power to pre vent Treasury from making good on the public debt.
No one in Congress is calling for the Treasury to default in the public debt. That threat is coming from the Treasury.
The debt ceiling is simply the maximum amount of principal the government can borrow.
If Congress declines to raise the debt ceiling, tax revenues can pay for about 60% of current spending.
Treasury can stop borrowing and roll over the currently due principal into new bonds.
The Public Debt Clause requires the President to use current tax revenues to pay off the interest on the debt before all other spending.
What the Public Debt Clause does not do is empower the President to seize Congress’ power of the purse which includes determining what the government may borrow.
In sum, the President’s threat to default on the debt unless Congress allows him to increase the debt is both reckless and unconstitutional.
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If Congress declines to raise the debt ceiling, tax revenues can pay for about 60% of current spending.
So what does it mean that the current Congress passed a budget that required an increase in debt, but then wouldn’t authorize that increase in debt that they implicitly authorized as part of the budget they passed?
Since Congress has the power of the purse, what exactly is the Constitutional requirement when the day of reckoning arrives? And on what do you base your answer?
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#15 written by rgbact 1 year ago
Bart–
Legally speaking, what was the debt ceiling’s implied intent? Effectively. it would seem to give Congress an out on whatever they negotiated beforehand.. They can readily agree to spending, knowing they can later nullify it all with the debt ceiling. Is that giving Congress too much power? It actually is more powerful than a balanced budget amendment—since the BBA ties all parties hands in a negotiation—but the debt ceiling
allows one party to renege. But hey, maybe its the War Powers Act equivalent on the fiscal side. Just an implied power of one branch thats never been actually tested in the courts.Anyway–the whole notion of “stimulus” seems faulty. “Stimulus” implies something temporary. The spending the Dems did in 2009 was clearly not meant to be temporary.….anymore than the Bush tax cuts were.
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Bart, there are two other budgets that have been created: 1) Obama’s White House budget, and the 2) the Progressive Caucus budget. You meant to say that the Ryan budget is the only one that the Repub-dominated House has so far approved.
And yes, if the Republicans got everything they wanted in their wildest fantaises, they’d be happy to accept everything they always wanted in their wildest fantasies. Why do you imagine that a minority of élitist totalitarians should be allowed to dictate policy to the nation, in direct contradiction to the Will of We the People?
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DC:
1) MW claimed that the GOP agreed to the current deficit spending by enacting a budget calling for the borrowing. In fact, the Dems have so far blocked the FY 2012 budget.
2) The OC and WH “budgets” were actually outlines of wishful thinking which bipartisan majorities in the House and nearly all of the Senate voted down.
3) which 40% of current spending would I cut? Start with the 2000 baseline (which would be very close to current revenues) and adjust from there. In essence, reverse all the new Bush and Obama spending increases and the cut some more to pay for the added SS.
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Bart,
The GOP House budget (which is the only budget created to date)…
Another falsehood. The 2010–2011 budget was passed, and enacted on April 15, 2011. That budget covers all federal expenditures through September 30, 2011. That includes such dates as, well, this one. And the entire month of August.
In other words, the debt limit could perhaps be discussed for debts incurred starting October 1, but not before. Congress, including your sacred tsunami inductees, already approved the spending that requires an increase in the debt load.
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Bart,
MW claimed that the GOP agreed to the current deficit spending by enacting a budget calling for the borrowing. In fact, the Dems have so far blocked the FY 2012 budget.
That’s because the 2012 budget doesn’t begin until October 1. Completely separate issue.
Start with the 2000 baseline (which would be very close to current revenues) and adjust from there. In essence, reverse all the new Bush and Obama spending increases and the cut some more to pay for the added SS.
So what would you do about the impossible-to-avoid expenditures associated with Iraq and Afghanistan? I’m pretty sure they weren’t part of the 2000 budget. And what would you do about the other increases in Medicare/Medicaid that came from increased per-capita health care costs?
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MW:
The April deal was a continuing resolution derived from the fired Dem Congress’ previous string of continuing resolutions the GOP only voted for to keep the President from shutting down the entire government.
The Ryan budget is the only GOP budget to date and it requires double the current GOP demand for budget cuts in the debt ceiling negotiations. If the Dem Senate enacts and the Dem President signs the GOP budget then you can legitimately claim that the GOP agreed to the current deficit spending.
Currently, we have a Dem government operating under a Dem continuing resolution with a Dem deficit. The GOP will not be able to enact a GOP budget until Bachmann wins the presidency and the GOP takes the Senate in 2012.
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The April deal was a continuing resolution derived from the fired Dem Congress’ previous string of continuing resolutions the GOP only voted for to keep the President from shutting down the entire government.
Which means Michael was correct, and you’re trying to present it in a gruesome light. The fact is, the current Congress approved spending and authorized the debt up to Oct 1. Thank you for admitting that, even if you had to turn it into a Lovecraftian horror story.
You want to imply that Obama blackmailed the Republicans into approving these expenditures. At the same time, you are implying it’s okay for the Republicans to blackmail America into accepting their irresponsible future cuts. A double standard of this magnitude is easy to spot.
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By the way, Bart, if the “previous Dem Congress” was “fired”, then we don’t currently have a “Dem government.” Do you keep track of the propaganda shifts you put into a single comment? It’s dizzying.
I realize that you like reality to flutter back and forth depending on which Dadaist argument you’re currently making. But honestly, you could keep to one self-negating fantasy at a time, couldn’t you?
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Bart,
The April deal was a continuing resolution derived from the fired Dem Congress’ previous string of continuing resolutions the GOP only voted for to keep the President from shutting down the entire government.
Call it what you want. It was a bill passed by the sitting Congress, which has a heavy Republican majority, encompassing funding through September 30. It might not meet the Bart definition of a budget, but it meets the statutory definition.
The Ryan budget is the only GOP budget to date…
It’s a 2012 budget. Even if it passed tomorrow, it wouldn’t have any effect on expenditures between now and October 1.
The GOP will not be able to enact a GOP budget until Bachmann wins the presidency…
Well, then, I guess they’re in for a long wait.
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Bart, the point is, CONGRESS APPROVED FEDERAL EXPENDITURES THROUGH OCT 1. Just because some of the people in your party disapprove, that doesn’t mean Congress didn’t authorize these expenditures. This isn’t about blame. It’s about the fact that THE U.S. HAS COMMITTED TO CERTAIN OBLIGATIONS.
Get it? Or do you imagine that Federal obligations are only valid if Republicans like them?
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Michael Weiss:
Bart,The April deal was a continuing resolution derived from the fired Dem Congress’ previous string of continuing resolutions the GOP only voted for to keep the President from shutting down the entire government.
Call it what you want. It was a bill passed by the sitting Congress, which has a heavy Republican majority, encompassing funding through September 30. It might not meet the Bart definition of a budget, but it meets the statutory definition.
Congress has a heavy Republican majority? The voters lent the House to the GOP. The Senate and White House are Dem.
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fired Dem Congress
Interesting to point out that yes Virginia, even during Bartles’ 2010 wave election for Reps that the Dems still control the senate.
And again the obvious, Reps took control of the House not because they were popular in any way, shape or form, but because of anti-incumbency …
Bad news for Congressional Republicans
Emphasis mine.
“PPP’s newest national poll finds that after a little more than 3 months in charge House Republicans have fallen so far out of favor with the American public that it’s entirely possible Democrats could take control of the House back next year.
43% of voters think that House Republicans are doing a worse job now than the Democrats did, compared to only 36% who think the GOP has brought an improvement. 19% think things are about the same. 62% of voters thinking that the Republicans have either made things worse or brought no improvement to an (((already unpopular Congress))) does not bode particularly well for the party.
46% of voters say that if there was an election for Congress today they would vote Democratic, compared to only 41% who would vote Republican. That five point advantage for Democrats is only a hair below the margin Republicans won by in the national popular vote last year. A victory of that magnitude for the Democrats next year would at the very least result in the party taking back a large number of the seats it lost last year, and it could be enough to take back the outright majority– hard to say at this point without knowing how good a number the GOP can do in redistricting.
The key to this strong movement back toward the Democrats right now is the same as the key to the strong movement away from the Democrats last year– fickle independents quickly growing unhappy with the party in power. Exit polls showed independents supporting the GOP by a 19 point margin last year at 56–37. Now only 30% of those voters think that the Republican controlled House is moving things in the right direction, compared to 44% who think things were better with the Democrats. Given those numbers it’s not much of a surprise that independents now say they’d vote Democratic for the House by a 42–33 margin if these was an election today, representing a 28 point reversal in a span of just five months.
These poll numbers also point to the reality that Republicans taking control of the House may have been one of the best things that could possibly have happened for Obama’s reëlection prospects.
One thing is very much for certain– it’s not 2010 anymore.“
~~~~~Again, good thing for Bart the election won’t be held anytime soon lol and the obvious, The Ryan Plan is DOA, not that Dems won’t be using said plan against Reps from now until Nov. 2012 ie the recent embarrassing loss by Reps the the heavily conservative NY-26 special election.
carry on
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Bart:
fired Dem Congress
Bart:
Congress has a heavy Republican majority? The voters lent the House to the GOP. The Senate and White House are Dem.
Make up your mind. Did the voters “fire” the “Dem Congress”? or did the voters leave the Democrats in charge of most of the government?
Should we allow the minority Republicans to extort their rightist totalitarian agenda from the Democrats, who were elected by The People, and who still control most of the government? Or did the tsunami of 2010 sweep the Republicans into power, authorizing them to dictate government policy — which thus makes them responsible for the current state of affairs?
Which is it? Was there a tsunami sweeping the Republicans into power? Or was there a ripple giving them a little more of a minority voice? If they’re not responsible for the current condition of the country (because they’re still a minority), that means The Voters still wanted a Democratic majority — and don’t want the Republican agenda enacted. If the Republicans were installed in power because of a great conservative tidal wave, then they’re the ones we should be blaming because they’re now in charge.
I actually get it — the truth is somewhere in between. But you like to flipflop from one extreme to the other, depending on which rightist Orwellian historical rewrite you imagine would best suit the moment’s argument. But you’re beginning to sound like one of those magic 8-balls that gives random answers with no actual pattern or thought behind them.
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fired Dem Congress
Interesting to point out that yes Virginia, even during Bartles 2010 wave election for Reps that the Dems still control the senate.
The Dems seats in red states come up in 2012. Unless the economy experiences a Reagan-like boom, the GOP takes the Senate next year.
And again the obvious, Reps took control of the House not because they were popular in any way, shape or form, but because of anti-incumbency …
You are half right. The voters lent the GOP the House because of anti-Dem sentiment. This is why I posted “fired the Dem Congress.”
Bad news for Congressional Republicans
Emphasis mine.
“PPP’s newest national poll finds that after a little more than 3 months in charge House Republicans have fallen so far out of favor with the American public that it’s entirely possible Democrats could take control of the House back next year.Wanna put money down on that now?
PPP is a Dem outfit which ran a low sample poll of registered voters with heaven knows what weighting. Until they put on their LV screen, PPP is a propaganda outfit.
Rasmussen is still using his standard LV screen and still polling the congressional generic, which keeps bouncing around with the same GOP lead as much of 2010, when Ras underestimated the GOP gains.
BTW, the GOP is actually thinking long term for once and the state legislatures are eliminating safe GOP districts to add GOP voters to the new districts the party took in 2010 and creating minority majority safe Dem districts that the Obama Justice Department will be forced to support. In short, the GOP is cementing their heartland majority for at least the next decade.
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come up in 2012 … Unless the
Bartles your desperate deflections and inane hypotheticals are becoming quite tiresome …
Truly!
Wanna put money down on that now?
As well as your continued teabagging er bourgeois, die-hard, fearful, fogyish, fuddy-duddy, guarded, in a rut, inflexible, obstinate, old guard, old line, orthodox, reactionary, redneck, right of center, right-wing, timid, unchangeable, unchanging, uncreative, undaring, unimaginative …
posturing!
take care
btw, notice how when wingers easily get backed into a corner, they bring out their faux blustering Wanna put money down on that now? childish deflection.
>
Everyone must be watching the Casey Anthony trial as I continue to pummel Bart!
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come up in 2012 … Unless the
Bartles your desperate deflections and inane hypotheticals are becoming quite tiresome …
These are conditional statements, not deflections or hypotheticals. Pollsters use them all the time in their horserace polling because they know polling is simply a snapshot in time and conditions can change. Ask anyone polling the 2008 race in June 2007 while the economy was rocking along.
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shiloh:
Conditional statements are hypotheticals you ignorant fool …
apologies to ignorant fools!A hypothesis is a testable or falsifiable assumption.
A conditional prediction by its nature cannot be tested. For example, my conditional prediction is that the GOP will in the Senate in 2012 absent a Reagan-like economic boom. There either will or will not be a Reagan-like economic boom and it is impossible to test the alternative.
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A hypothesis … A conditional prediction
yada, yada, yada
Further embarrassing deflections/discombobulation(s) notwithstanding, let the record show Bart is totally flustered ie he did not disagree conditional statements are hypotheticals or that he’s an ignorant …
Again, when one is in a hole, stop digging!
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Bart:
A conditional prediction by its nature cannot be tested. For example, my conditional prediction is that the GOP will in the Senate in 2012 absent a Reagan-like economic boom. There either will or will not be a Reagan-like economic boom and it is impossible to test the alternative.
On the other hand, a conditional can still be proven false. In this example, if there is no “Reagan-like economic boom” and yet the Republicans do not take control of the Senate, then then prediction was false. However, a clever spinmeister can claim that if the Republicans do not win control of the Senate, then whatever happened to the economy was a “Reagan-like economic boom.” (Especially since the “Reagan boom” was really no more than a minor fizzle in 1988.)
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DC:
Good point.
BTW, you can tell a Reagan-like economic boom without a degree in economics — the GDP is sprinting at a rate above 5% and the unemployment rate is free falling by about a point every six months because millions of private sector jobs are being created. After the last two lost years of Obama, the change will be stark.
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DC… you’re quite right. Big polls like the one I quoted from above, show that among seniors and midwesterners, the numbers who self-ID as Dems have increased by 9 and 7 points respectively since last year.
The Republicans with their “pro-millionaire, club-the-poor-like-baby-seals” rhetoric have become so highly visible and universally loathed, the blame for the economy is now moving from Obama to THEM. All they needed to do was keep their heads down and co-operate just a bit, and they would have been aces. But they simply can’t. The fanaticism runs too deep.
When, at Obama’s Twitter Townhall, Boehner tweeted “where are the jobs?”… the audience laughed.
It’s astonishing to watch.
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#50 written by rgbact 1 year ago
Yeah Bart–
I guess the GOP’s conspiracy didn’t work too well in the 90’s. Got welfare reform, tax cuts, balanced budget, Medicare reform. But Clinton got reëlected—-damnit—-why couldn’t things have failed instead.
Right now, Obama is just begging the GOP for a budget deal to save him from the misery that is his record. He’d sign anything right now. Hope Boehner knows this. The GOP will likely be Obama’s lifesaver, like for Clinton.
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#52 written by rgbact 1 year ago
Bart–
Watching the Senate Dems this week–I think you’re wrong. I think they are the ones actually pushing Obama to deal. They desperately don’t want to develop their own budget and the last minute cram jobs are really the only way they will vote on anything anymore. So, whatever Obama can get that seems bipartisan and gets them thru 2012 is fine. They can still beat the GOP over the head on the Ryan plan anyway.
Yeah, I’m hoping the GOP Senate says unless they have a week to review–they won’t sign on. I expect alot of accounting gimmicks. If so, Boehner needs to go.
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Do you know how conspiracy theory nutty that sounds?
Yes. It sounds not at all nutty. Nutty conspiracy theories require conspirators who either stand little or nothing to gain by conspiring, or that they work against their core beliefs.
Our political process self-selects for people who will do anything to get reëlected. It is in the Republicans’ best interest for Obama to fail. Rush Limbaugh said it before Obama had even been inaugurated. So it’s not at all nutty that the party would be focused on Obama’s failure, even at the expense of the health of the country.
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Rgb, Bart,
Yes, the Republicans are intentionally keeping the economy slow. They’re throwing tens of thousands of public employees out of work at the state and local level. Republican governors are refusing to spend ARRA money. This insane meme that the way out of the recession is to do nothing.
rgb,
Obama is just begging the GOP for a budget deal to save him from the misery that is his record.
This is the craziest thing I’ve heard in a long time. Here the Republicans have been screaming that we need a “budget deal” or else they won’t make good on America’s current commitments. Obama calls their bluff, and says, “Okay fine, let’s make a budget deal” — and you claim he’s “begging” for one in order to improve his record? That’s insane.
Not only that, he’s going beyond what even the Republicans were saying. He’s looking for a comprehensive deal that includes everything. Republicans were merely using it as a talking point, a political club. They never intended to fix anything — if possible, they intended to break things more. So Obama is being the adult, and telling them, “You claim you want to address America’s budget issues? Here’s your chance. Get serious or shut the hell up.”
It’ll be interesting to see how the Republicans respond. Will they actually cut a deal? Will they keep insanely demanding more more more? Will they walk out in a snit because any workable solution must involve increased revenues?
If they do cut a workable deal, will the nutbat Teapers start talking about armed rebellion again?
It’s fun watching Obama play these guys like cheap fiddles. The Republicans put themselves waist deep in quicksand. Will they accept a lifeline, or will they insist on drowning? — leaving Obama no choice but to invoke the 14th Amendment and to paint them as the spoiled children they are?
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Bart
neither party is taking the debt crisis seriously.
That’s because it isn’t a “debt crisis.” That’s just a rightist talking point.
The crisis that does exist is the Great Recession, which Republicans are refusing to do anything about. They’re using this “debt crisis” paranoia as an excuse to prolong the pain as they transfer more of America’s wealth to their élite benefactors — just as they did in the early 1930s.
Obama is talking a page out of Clinton’s playbook. President Clinton was a master at talking the Republican talking points away from them. Do remember that “The era of big government is over!” and “We will end welfare as we know it!” were Clinton’s lines.
The Republicans and their propaganda arm, FOX “News,” have convinced Americans that there’s a “debt crisis” which must be solved before humanity’s betters, the Wealthy Job Makers, will deign to re-employ us. So Obama is calling their bluff. Fine, let’s solve the “debt crisis.” What are you going to complain about then?
Will the Republicans actually work to solve anything? Or will they continue to simply scream “NO!” with their fingers in their ears? Maybe I should put this on a site poll to get readers’ opinions.…
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Do you know how conspiracy theory nutty that sounds?
Yes. It sounds not at all nutty. Nutty conspiracy theories require conspirators who either stand little or nothing to gain by conspiring, or that they work against their core beliefs.
Our political process self-selects for people who will do anything to get reelected. It is in the Republicans’ best interest for Obama to fail. Rush Limbaugh said it before Obama had even been inaugurated. So it’s not at all nutty that the party would be focused on Obama’s failure, even at the expense of the health of the country.
It is interesting that you should reference Limbaugh because he has been arguing for months that no rational human being could be pursuing Obama’s agenda and thus he must be intentionally attempting to tank the economy for political advantage. You and DC appear to be making the mirror image argument.
Obama is the most successful President on the left since FDR and obtained all of his policy priorities except Cap & Tax, and his EPA is attempting to backdoor that policy by fiat. The country has operated under Obama policies since 2⁄09 and will do so until at least 1⁄13. Thus, the pathetic argument that the GOP is somehow tanking the economy is nonsense on its face. Obama owns this lock, stock and barrel.
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DC,
That’s because it isn’t a “debt crisis.” That’s just a rightist talking point.
There is a debt crisis in a sense. We had this kind of debt load before, during World War II, but the difference then was that 80% of that debt was from the war, which meant that there was a clear end to the spending and a clear path to long-term solvency.
Our current debt is certainly partially attributable to the Keynesian countercyclical spending efforts, but nowhere near 80% of it. Without addressing the medical spending and a few other things, we’re not looking at a clear end to the spending or a clear path to long-term solvency.
In that sense, while “crisis” might be too strong a word to use for 2011, it’s clear that we’re heading in that direction pretty rapidly.
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Michael,
You are correct (naturally) that there is a long-term issue that must be addressed, that is, finding ways to keep Medicare, Medicaid, and Social Security functional and solvent. For the last of these three, the solutions are straightforward (which doesn’t mean they’re politically easy). For the other two, a lot has to do with prescription drugs (the prices for these should be negotiated, just as the VA does), and there needs to be ways to control the rising cost of end-of-life care, plus better preventive care.
But there is a difference between a “problem” and a “crisis.” Admittedly, America has a tendency to avoid problems until they become crises. So perhaps portraying it as a “crisis” is a good idea if it gets things solved — though rational thought seems to go out the window once crisis mode takes over.
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Bart:
Obama is the most successful President on the left since FDR and obtained all of his policy priorities except Cap & [Trade]
Not bad for a guy whom the right claimed was inexperienced and incompetent.
It bears repeating that “cap and trade” was a Republican idea. They loved the concept of having the free market solve the problem of greenhouse gases, until Obama embraced it. Your contempt displays yet another example of the emptiness of rightist rhetoric, coupled with the right’s willingness to destroy America in a cheap effort to score talking points.
But since the Republicans campaigned on their ability to turn the economy around and to create jobs, and then proclaimed the success of their tsunami that gave them control of the House, it’s hard to see how you can blame the current state of affairs on Obama. Mr Boehnor, where are the jobs?
I do hold Obama accountable for one thing — he was far too timid when it came to stimulus spending. But given mindless Republican obstructionism, I recognize the half-measure he got was probably the best he could do. That we have pulled out of the Republican Great Recession as far as we have, and as quickly as we have, despite the best efforts of Republicans, is nothing short of stunning.
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#60 written by Mainer 1 year ago
Come on what have the Republicans done to make one positive move to help the economy? Any thing as I don’t see it. Deficit? Bull shit. Cut taxes? More bullshit. Get in the freaking way? Most definetly!!!
I know some of you are just salivating that unemployement is going up as it appears any thing that hurts the president some how helps you but I still don’t see the end goal. What earthly thing is there in the Republican policy manual that would not make things worse for most of us if they were implimented across the board?
Another thought. I’m not getting these new employement numbers. I live in a pretty economically challenged area, always has been always will be. Just where we are. We presently have more people working and less unemployed than we have in several years. There is work, not high paying work but work. Now in a recession we are the first to feel the pinch and the last to see the relief. So how is it that there is hireing going on here at the end of the economic life line and there isn’t up the line? This makes no sense to me at all. We produce raw materials, Wood pulp, soft wood lumber and up the chain for us fabric for vehicle interiors and medical applicators and wooden applicators and food industry things like popscicle sticks. The farms are bustling and the boats are fishing and the motels are full of vactioners so what is happening down in the big city?
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#61 written by mostlyilurk 1 year ago
Did you hear about Michele Bachmann’s statement to the effect that she hoped that higher unemployment numbers or worsening economic conditions would help her get elected. I guess she’s not terribly concerned at all about the people without jobs and health insurance and instead is only interested in what she thinks will advance her in her political aspirations. I suppose we should ignore the fact that she’s currently a member of the House of Representatives with a responsibility to the folks who elected her (some of whom are included in the ranks of the unemployed and uninsured) and pretend that she really, really would like to see a robust economic recovery under Obama and will do everything she can to make that happen. Yeah, right.
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#62 written by Max aka Birdpilot 1 year ago
Limbaugh because he has been arguing for months that no rational human being could be pursuing Obama’s agenda and thus he must be intentionally attempting to tank the economy for political advantage.
Actually, it’s not just a conspiracy, it’s a real policy by the GOP. And it’s followers, as Bart, are the first, as does Bart, to trumpet the latest bad news. The ill imformed may well believe them.
And as far as the above quote: No rational human being would cite Rush Limbaugh as a reasoned source, and anyone who does is so full of shit their eyes are brown!
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Mainer,
We produce raw materials,
It could be that the producers of raw materials are starting to see a pickup, because the rest of the economy is on the verge of starting to produce again. If manufacturers are anticipating an increase in demand, perhaps they are asking raw material providers to begin turning up the supply chain.
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Mitch McConnell said his number one priority is to make Obama a one-term president. I believe him. I am certain McConnell was being entirely honest. Defeating Obama is McConnell’s top priority, more important than improving the economy, more important than creating jobs, more important than the deficit, more important than oil prices or the wars or the financial meltdown or global warming or civil rights or the good of the people in his state. The thing he cares about most is defeating Obama.
So it stands to reason that if he thinks a bad economy is also bad for President Obama, that McConnell would do everything in his power to help create and maintain a bad economy. It’s not complicated.
Do we take Senator McConnell at his word? Or is Bart calling Senator McConnell a liar?
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Michael Weiss:
DC,That’s because it isn’t a “debt crisis.” That’s just a rightist talking point.
There is a debt crisis in a sense. We had this kind of debt load before, during World War II, but the difference then was that 80% of that debt was from the war, which meant that there was a clear end to the spending and a clear path to long-term solvency.
Our current debt is certainly partially attributable to the Keynesian countercyclical spending efforts, but nowhere near 80% of it. Without addressing the medical spending and a few other things, we’re not looking at a clear end to the spending or a clear path to long-term solvency.
In that sense, while “crisis” might be too strong a word to use for 2011, it’s clear that we’re heading in that direction pretty rapidly.I’m sorry, but the crisis is here and now.
At our present rate of borrowing, the United States will be in PIIGS territory in less than a decade.
The US ship of state cannot be moved sufficiently in the short term to stop the fiscal bleeding somewhere down the road say 3–4 years before insolvency.
If we act right now to eliminate the now $1.8 trillion deficit over five years at a steady glide path, we are talking about $300 billion in new spending cuts each year and hoping economic growth boosts revenues to cover the rest.
Neither party is close to agreeing to that.
Ryan’s plan is talking about a far longer glide path with 2⁄3 of the cuts. To work, we would have to enact that plan in the next year or two. The Dems have declared even that relatively mild plan a nonstarter and can indeed block it until at least 2⁄13.
Given the lack of political will to get our house in order, we are indeed in a clear and present debt crisis. Given what is politically possible in the way of cuts, there is simply no more time to delay.
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dcpetterson:
Bart:Obama is the most successful President on the left since FDR and obtained all of his policy priorities except Cap & [Trade]
It bears repeating that “cap and trade” was a Republican idea. They loved the concept of having the free market solve the problem of greenhouse gases, until Obama embraced it. Your contempt displays yet another example of the emptiness of rightist rhetoric, coupled with the right’s willingness to destroy America in a cheap effort to score talking points.
Cap & Trade was a conservative idea to efficiently allocate the externalized costs of actual pollution. Almost no actual conservative still believes the AGW hypothesis that CO2 is a pollutant.
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I’m sorry, but the crisis is here and now.
At our present rate of borrowing, the United States will be in PIIGS territory in less than a decade.And, in two consecutive sentences, you both contradict yourself and confirm what I already said. Being in PIIGS territory is a crisis. If it’s “les than a decade”, then it’s not “here and now”. It’s soon, though…which is what I already said.
If we act right now to eliminate the now $1.8 trillion deficit over five years at a steady glide path, we are talking about $300 billion in new spending cuts each year and hoping economic growth boosts revenues to cover the rest.
No, we’re not talking about that. We’re talking about a shift in about $300 billion a year in the difference between tax revenues and government spending. Since Deficit = Income — Spending, reducing Deficit can happen via four changes that I can see. Why are you only capable of seeing one?
Ryan’s plan is talking about a far longer glide path with 2⁄3 of the cuts. To work, we would have to enact that plan in the next year or two. The Dems have declared even that relatively mild plan a nonstarter
Perhaps because the plan involved cutting tax revenues further. Pretty lame proposal, in my estimation. It hardly sounds like a means of getting our house in order. Tax cuts aren’t the answer to every question.
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Almost no actual conservative still believes the AGW hypothesis that CO2 is a pollutant.
I wonder if that’s true. George Wallace said in his later years that he wasn’t really a segregationist, but rather was willing to promote segregation if that’s what it took to get elected. How many Republicans in Congress feel the same way about AGW? The world may never know.
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At our present rate of borrowing,…
Of course, NO ONE approves of our “present rate of borrowing.” No one. And NO ONE imagines it can go on forever. No one.
The disagreements are a) how to reduce that, given that various methods will, inevitably, have both positive and negative effects on the economy, and b) how quickly to reduce it, given that there simply isn’t any way to do it quickly without doing immense damage.
It is simply not possible to balance the budget with spending cuts only. Can’t happen. The required payments that America is already committed to, plus military spending and interest payments, exceeds current revenues. Even if you eliminate all other spending, there’s still a massive deficit.
So revenue increases have to happen. We might as well stop pretending they don’t.
Furthermore, a great deal of the revenue problem we now have is due to the economic slowdown. Because the economy is slow, that meas tax revenue has decreased. When the economy picks up again, revenues will increase. It’s silly to pretend that we have to reduce spending to match the current level of revenue. So let’s stop doing that, too.
The economy did great with the Clinton-era tax structure. By returning there, we can solve the medium– and long-term budget issues. Simple, clean, straightforward, and we know it won’t hurt job growth or economic expansion. So let’s start with that.
For the long term — when Clinton left office, economists were predicting $300 — $500-billion surpluses for as far as the eye could see. The Bush tax cuts screwed that, and led to massive deficits, and ultimately to the collapse of ’08. Getting back to a Clintonesque tax structure should, in the long term, produce enough revenue to begin paying off the Reagan / Bush / Bush debt. Problem solved.
Social Security, Medicare, and Medicaid are separate issues, which need to be addressed separately. Social Security and be kept solvent by raising the contribution cap, means-testing payouts, or both. Medicare and Medicaid need changes to how healthcare is done in America. None of this has anything to do with the other budget issues.
See? Not so hard. All it takes is to face reality.
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#70 written by Max aka Birdpilot 1 year ago
If we act right now to eliminate the now $1.8 trillion deficit over five years at a steady glide path, we are talking about $300 billion in new spending cuts each year and hoping economic growth boosts revenues to cover the rest.
Note the telling truth implied in Bart’s statement: The GOP policy to keep the economy down so that there is no resultant increase in revenue due to a better economy and more job growth. ALL the decrease in deficit comes from cuts and NONE from a better economy!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Accomplished by the GOP suppressing any chance of economic improvement.
The TRUTH comes out!!!! Thanks. Bart, for the admission.
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$300 billion in new spending cuts each year and hoping economic growth boosts revenues to cover the rest.
::: sigh :::
Reducing spending by $300 billion / year means laying off tens of thousands of people every year — maybe hundreds of thousands. That means increased unemployment costs, lower demand for goods, and decreased economic activity, which means lower tax revenues.
Prescription for increased disaster.
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#72 written by Mainer 1 year ago
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#73 written by rgbact 1 year ago
Bart–
Saying things like “less than a decade” belittles the debt problem. Whenever uniformed people read things like that they assume there’s really no problem and there is just a bunch of fearmonging (just like we think for AGW). The reality is, we are right there with Greece in terms of being busto. If we didnt have a currency that we could debase or a strong military—we would be just as screwed as those other guys.
Anyone saying be don’t have a debt crises better not be calling us denialists when in comes to AGW.
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I’m sorry, but the crisis is here and now.
At our present rate of borrowing, the United States will be in PIIGS territory in less than a decade.And, in two consecutive sentences, you both contradict yourself and confirm what I already said. Being in PIIGS territory is a crisis. If it’s “les than a decade”, then it’s not “here and now”. It’s soon, though…which is what I already said.
Perhaps we have different definitions of crisis. I see a crisis when I see the cliff and still have time to apply the brakes. You apparently do not see a crisis until you are already doing a Thelma & Louise over the cliff.
If we act right now to eliminate the now $1.8 trillion deficit over five years at a steady glide path, we are talking about $300 billion in new spending cuts each year and hoping economic growth boosts revenues to cover the rest.
No, we’re not talking about that. We’re talking about a shift in about $300 billion a year in the difference between tax revenues and government spending. Since Deficit = Income — Spending, reducing Deficit can happen via four changes that I can see. Why are you only capable of seeing one?
There is only one historically effective means — spend less. (See 1999 and 2000).
We have tried grand bargain combinations of tax increases and spending cuts before (82, 90) and they never work. We get the tax increases, the tax increase brings in less than projected revenue and we never see any substantial net spending cuts.
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rgbact:
Bart–
Saying things like “less than a decade” belittles the debt problem. Whenever uniformed people read things like that they assume there’s really no problem and there is just a bunch of fearmonging (just like we think for AGW). The reality is, we are right there with Greece in terms of being busto. If we didnt have a currency that we could debase or a strong military—we would be just as screwed as those other guys.I do not count the IOUs treasury wrote to SS as public debt because there is actually no actual legal obligation to pay them. Thus, we are still a bit less than a decade short of PIIGS territory of sovereign insolvency.
SS is another problem entirely and will require changing the inflation index to chained CPI and extending the retirement age over time.
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DC,
Reducing spending by $300 billion / year means laying off tens of thousands of people every year — maybe hundreds of thousands.
Not necessarily. Depends on where that money is going. For example, let’s just cut Social Security payments in half starting next year. We’d save $350 billion right there, and wouldn’t lay off a single person.
What matters is not the number of dollars spent, but rather on what those dollars are spent.
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rgbact,
Anyone saying be don’t have a debt crises better not be calling us denialists when in comes to AGW.
Oh, puhleeze. The effects of increased carbon dioxide are much slower to realize than are the effects of increased debt. And much more intractable to address. The two are not comparable in any meaningful way.
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Perhaps we have different definitions of crisis. I see a crisis when I see the cliff and still have time to apply the brakes. You apparently do not see a crisis until you are already doing a Thelma & Louise over the cliff.
Or perhaps I recognize that there’s still plenty of time to apply the brakes. Sure, it’d be preferable to have a gentle application of the brakes…it’s less jolting. But it becomes a crisis when you are out of margin for error in avoiding going over the cliff. We’re not there yet.
That’s not to say that I don’t think it would have been far better to have done something about it, oh, say, 20 years ago. And every year since.
We get the tax increases, the tax increase brings in less than projected revenue…
I don’t care. Really. So the actual revenue is lower than projected. So what? The question I want answered is whether it’s higher than without the tax increase. And for the federal rates we’ve seen in the past half century, the answer has always been yes. Always.
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I do not count the IOUs treasury wrote to SS as public debt because there is actually no actual legal obligation to pay them.
How so? They’re treasury notes, just like any others.
When the government writes IOUs to itself, who is going to enforce a claim when the government says that it will not honor them?
There is no SS reserve and the government will have to issue public debt to finance all future SS payments above taxes.
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#82 written by shortchain 1 year ago
What kind of an intellect (I use the term loosely) insists on an equivalence between trashing the global ecosystem, plunging millions, perhaps billions, into starvation and water shortages, catastrophic weather events and who knows what collateral damage down the road after the mass extinction event really takes hold, with a relatively small problem (in historical terms) in cash flow — which could be cured by a relatively small tax increase?
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The unemployment figures are likely far worse than they appear as over half of the alleged new jobs created over the first half of 2011 were added under the birth/death adjustment:
Except that most reports you read are the seasonally-adjusted ones…and they don’t use B/D in the seasonally-adjusted unemployment figures…
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When the government writes IOUs to itself, who is going to enforce a claim when the government says that it will not honor them?
When you’re talking Social Security, it seems pretty clear that it’s the voters who will enforce the claim. It’s not referred to as a “third rail” for nothing.
the government will have to issue public debt to finance all future SS payments above taxes
Of course. The government has to issue public debt to finance all payments above taxes. Or increase the money supply, which is in many ways a different form of taxation.
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#85 written by Max aka Birdpilot 1 year ago
We have tried grand bargain combinations of tax increases and spending cuts before (82, 90) and they never work. We get the tax increases, the tax increase brings in less than projected revenue and we never see any substantial net spending cuts.
A flat out lie. Again.
The Tax Bill of 1993 increased a number of taxes, conjoined with the reduction in federal employees (cuts) and reduction in “welfare as we know it” (cuts), it helped usher in the best decade of growth in 30 years and put the country in a SURPLUS!
Eight years later, Bush tax cuts, two unpaid wars and Medicare D, and where do we find ourselves a few short years later?
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the government will have to issue public debt to finance all future SS payments above taxes
Of course. The government has to issue public debt to finance all payments above taxes.
Not necessarily. The alternative is to increase taxes to cover the committed expenses. But maybe that’s merely semantics — is it “public debt” if it’s been paid for?
I note that Bart wants to renege on America’s Social Security commitments. I hope Republican leaders take a clue from Bart, and are as honest and open about it. They’ll never win another election.
By the way, Bart, since the idea you propose (cutting Social Security payments in half) is wildly unpopular, does that make you an autocratic totalitarian, opposed to the Will of The People? Or did you not mean that suggestion to be taken seriously?
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The Tax Bill of 1993 increased a number of taxes, conjoined with the reduction in federal employees (cuts) and reduction in “welfare as we know it” (cuts), it helped usher in the best decade of growth in 30 years and put the country in a SURPLUS!
That’s hardly evidence of a causal relationship, you know. The significant business process reengineering that went on at the time, coupled with the improved data transmission afforded through the Internet, likely had a far greater impact than any particular government policy of the time.
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Not necessarily. The alternative is to increase taxes to cover the committed expenses.
You misread what I wrote. The government has to issue public debt to finance all payments above taxes. In other words, to cover deficits. If you increase tax revenues by enough, then you no longer have a deficit. Whether it’s possible to increase the tax revenues is a separate, situation-specific question.
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You’re so funny, Bart.
“Taking the office of President” is what most of the people on this planet would call “being elected President of the United States”.
On your planet, maybe not so much.