Patterico's Pontifications

2/26/2009

Obama’s Budget: What the [String of Expletives Deleted]ing [Still More Deleted]

Filed under: General,Obama — Patterico @ 9:29 pm

Obama today said: “[T]here are some hard choices that lie ahead. Just as a family has to make hard choices about where to spend and where to save, so do we as a government.”

How hard will the choices be? I’ll tell you how hard: his new budget is $3.55 trillion.

If that’s not making the hard choices, I don’t know what is.

Speaking of things that are hard to do, it was hard to write this post without using several expletives.

Then I read that this budget amounts to $25,000 per taxpayer, and it got harder.

I’m going to stop writing now. The kids are asleep, so I need to find a pillow to scream into. Thanks for reading.

83 Responses to “Obama’s Budget: What the [String of Expletives Deleted]ing [Still More Deleted]”

  1. It’s one thing to argue politics, even with people who have a bumper sticker mentality. A walk through the ocean of their souls would scarce get your feet wet, to quote PJ O’Rourke.

    But you are right about our kids (and I have two little ones, too).

    I think many people are going to get involved at the grass roots. Just as nobody in Congress actually read the stimulus bill before voting, I’m very sure that many people voted for Barack Obama wihout knowing what he thought on a wide variety of topics.

    Example: the number of pro-gay marriage folk who seem to think, inexplicably, that Obama supports such legislation.

    No, just like congresscritters decided that the stimulus bill was vital, folks insisted that Hope and Change was coming from the Chicago machine and racialist politics.

    It’s going to be a tough four years, I suspect. But the interesting part is that I won’t be angry if I am wrong. This is fundamentally different from many of our friends on the Left!

    Eric Blair (8d54e0)

  2. Then I read that this budget amounts to $25,000 per taxpayer, and it got harder.

    Sorry, man. But I’m gonna have to opt out.

    EW1(SG) (e27928)

  3. Felix Salmon had an apt reaction:

    I was worried about Barack Obama’s plans to cut the budget deficit in half by the end of his first term: I thought they implied undue optimism about the economic future of this country. As it turns out, they just implied an almost unimaginably-large deficit at the beginning of his first term: $1.75 trillion.

    Brother Bradley J. Fikes, C.O.R. (0ea407)

  4. John Kasich was on Fox tonight commenting that when he left Congress, total Federal spending was $1.7Trillion, and now the deficit is $1.7Trillion.

    AD - RtR/OS (02b895)

  5. Then I read that this budget amounts to $25,000 per taxpayer, and it got harder.

    But I thought everything was supposed to be free now.
    You know,pay for my gas,pay my mortgage.

    I am glad that deficits don’t matter now.
    It is amazing what problems can be solved simply by having a (D) beside your name:

    White House Budget Director Orszag: “Elevated Deficits Are Beneficial”

    “During an economic downturn like we’re experiencing the deficit gets elevated which is not only natural, it’s beneficial because it helps bring the economy back up to the potential output level. In other words, the key problem we face right now is the gap between how much the economy could produce and how much it is producing. The whole point of the Recovery Act is to fill in that gap and part of that means a temporary elevated deficit.”
    Peter Orszag
    White House Budget Director
    February 26, 2009

    Whew!!! what a relief.
    And to think I was worried about the dollar,inflation,and investment crumbling under massive debt.
    Silly me!!!


    Obama’s trillions dwarf Bush’s ‘dangerous’ spending

    By Byron York
    Chief political correspondent 2/24/09
    http://www.dcexaminer.com/politics/Obamas-trillions-dwarf-Bushs-dangerous-spending.html

    Pelosi and Reid called Bush’s budgets “dangerous” and “unpatriotic,” but with Obama, they’ve changed their tune

    The new spending guarantees that the problems that so disturbed Pelosi and Reid just a couple of years ago — high interest payments and an increasing number of foreign debt-holders — will get worse. Yet so far, the Democratic leaders have refrained from using words like unpatriotic, irresponsible and dangerous to describe Obama’s budget.

    Bush’s deficit that was made up of 2 wars, Katrina,and his spending is nothing but a blip on the radar compared to the welfare state Mr. Pay-as-you-go has mounted up in just a month.

    Meanwhile, Mitch McConnell in the after-speech spin points out that in the first month of Obama’s administration Congress has spent more money than it spent on Iraq, Afghanistan, and Katrina relief over the past seven years

    .

    Inflation…Raising Taxes….Welfare State…Inflation….Raising Taxes….Welfare State….Inflation….Raising Taxes…Welfare state.

    “YES WE CAN”

    Baxter Greene (8035ae)

  6. Every time Teh One speaks I am reminded of an ESPN commercial where the guy keeps talking out his ass.
    Although I expect Teh One has more than one ass and he talks out of both at the same time.

    ML (14488c)

  7. John Kasich was on Fox tonight commenting that when he left Congress, total Federal spending was $1.7Trillion, and now the deficit is $1.7Trillion.

    Good grief.

    How many trillion in new spending are we up to this week?

    Patricia (89cb84)

  8. my advice to all of you is to all start drinking heavily….

    /Spirit of Bluto

    redc1c4 (9c4f4a)

  9. The “hard choices” will be which lies he uses to justify taking from those who earn to to give to those who don’t.

    Between the inflation tax, the income tax jump, the carbon taxes and the other taxes yet to come, the one real question will be why anyone still bothers to work.

    Kevin Murphy (0b2493)

  10. my advice to all of you is to all start drinking heavily

    Tried that for much of the 70′s. Turned out not to work all that well.

    Kevin Murphy (0b2493)

  11. Remember the talking point that was oh so fashionable among the left eight years ago — how tax cuts were really just designed to drive up large deficits so that there was no money left over for the social spending that liberals believe is crucial towards re-making America in their preferred image? Looks like Dear Leader has figured out a way to square that circle. The natural progression will be for government to take more and more of our money in order to combat these pesky deficits, but while the economy suffers from all this high taxation the government will try to combat it by pumping more and more money into the preferred industries as “stimulus.” We’ll be on our way to the Zimbawbean model in no time flat.

    Remember too how the left said that Bush, Cheney, and Rumsfeld had no right to direct military policy since none of them had served active duty? Have Obama, Biden, Pelosi, and Reid ever held a job in private enterprise?

    JVW (bff0a4)

  12. I can’t wait for Congressmen from high income states like Calif. and NY to hear from their constituents about Obama’s plan to limit the benefit of itemizing deductions on incomes over $250,000.

    The interest from that $800,000 mortgage? Sorry, deductability now limited.

    State income taxes? Limited.

    Real estate taxes? Limited.

    NEVER mentioned this Robin Hood idea in 2 years of campaigning.

    WLS Shipwrecked (86c79b)

  13. WLS Shipwrecked:

    Check your e-mail.

    Patterico (cc3b34)

  14. Its the Annenberg Project all over again. Obama totally wasted $150 million making grants to improve the Chicago school system. No improvements were made and $150 million was lost. Obama learned nothing and never apologized for his waste. In fact, in Obama’s disturbed mind, he thought it qualified him for a higher office. Now Obama is setting out to waste trillions of dollars “improving” America. Outside of warfare, Obama’s plans will be the largest waste in human history.

    Perfect Sense (0922fa)

  15. Patterico, please fact-check this claim for me (the bold portion):

    During his first address to a joint session of Congress last night, Obama said he was proud that the $787 billion economic stimulus plan was enacted “free of earmarks.” He added that his administration “has begun to go line by line through the federal budget in order to eliminate wasteful and ineffective programs.”

    The pet projects remain popular with lawmakers on both sides of the aisle; about 40 percent of the earmarks in the omnibus were sought by Republicans.

    There has to be a mistake here, considering that Republicans, who make up about 40% of congress, cannot possibly have pursued such a big chunk of this pork, given their incessant whining about it.

    link.

    Andrew (96ab30)

  16. Andrew – check your own facts. You have already demonstrated a painfully deficient level of understanding on taxes, and general economics.

    $1,750,000,000,000 deficit. I personally think it is fucking cute how Baracky explodes the deficit in the first 30 days while he is in office, and then has the audacity to claim that he will cut the deficit in half.

    JD (0aaaea)

  17. $3,500,000,000,000 budget. $3,500,000,000,000.

    JD (0aaaea)

  18. So, if you go outside to scream at the sky, to keep from awakening the little Pattericos, will your neighbors call the police?

    The sympathetic Dana (3e4784)

  19. The scene from “Planet of the Apes” where Heston sees the Statue of Liberty and cried “You Maniacs! You blew it up! Ah, damn you! God damn you all to hell!” keeps coming to mind lately.

    voiceofreason2 (10af7e)

  20. Between the inflation tax, the income tax jump, the carbon taxes and the other taxes yet to come, the one real question will be why anyone still bothers to work.

    I’m already making plans to live out of JD’s garage.

    voiceofreason2 (10af7e)

  21. Strictly speaking, your post contains at least two expletives (words without semantic content that serve purely grammatical roles) that were not deleted: the “there” at the beginning of the Obama quote and the “it” in “it was hard to write this post.”

    Xrlq (62cad4)

  22. “But I thought everything was supposed to be free now.
    You know,pay for my gas,pay my mortgage.”

    With some folks its hard to tell when they’re playing dumb.

    imdw (f0a2e3)

  23. Who is John Galt?

    Washington, D.C., February 23, 2009–Sales of Ayn Rand’s “Atlas Shrugged” have almost tripled over the first seven weeks of this year compared with sales for the same period in 2008. This continues a strong trend after bookstore sales reached an all-time annual high in 2008 of about 200,000 copies sold.

    “Americans are flocking to buy and read ‘Atlas Shrugged’ because there are uncanny similarities between the plot-line of the book and the events of our day” said Yaron Brook, Executive Director at the Ayn Rand Center for Individual Rights. “Americans are rightfully concerned about the economic crisis and government’s increasing intervention and attempts to control the economy. Ayn Rand understood and identified the deeper causes of the crisis we’re facing, and she offered, in ‘Atlas Shrugged,’ a principled and practical solution consistent with American values.”

    Horatio (55069c)

  24. I am like most blog readers – a political junkie. I read just about everything that is said, ponder it, and react. I know politicians lie, but I figured that what they said was still somewhat relevant.

    We need to stop. What is said and written by just about everyone is not even remotely related to reality. The current political leadership’s words are never reliable. The words are as worthless as the electrons that bring them to your flat screen. It may as well be the barking of the dog next door.

    Face it – there is not much more than zero written opinion anywhere that is relevant at all today. There is only a piecemeal record of what was actually done. The words only serve to confuse the actions.

    Amphipolis (fdbc48)

  25. Lighten up, Patterico, it ain’t your money…..

    howard432 (3f8901)

  26. Patterico, would it be too rude for me to ask what your income is?

    Andrew (6cf219)

  27. So, please tell me, is the budget 3.55e12 dollars INCLUDING the “Stimulus” package or is that still separate?

    Techie (6b5d8d)

  28. Andrew, why don’t you explain to us how that information would be relevant?

    Amphipolis (fdbc48)

  29. The effect of this plan will be a general slowing of economic activity. Incentives are being lost and others are being created. Democrats don’t give to charity so that is reduced. University professors (sorry Eric) tend not to be investors (except their pension plans but they haven’t figured that part out yet) so that is not important.

    I was watching Fox this morning about 5:20 and Geraldo was sharing his economic wisdom with us. He said he met with his accountant in 1982 after the Reagan tax cuts. He saw that he would get more money back and said “That’s not fair !” He has no concept of the distribution of tax receipts. He doesn’t know that 10% of the population pays 62% of the income tax. He doesn’t know that 1% pays 40% of the taxes. I’m sure he doesn’t know that 40% pay no income tax at all. Guess who they voted for.

    This will increase unemployment. The reduction of tax deductibility of mortgage interest, while a good idea long term, will kill the housing recovery. This is a formula for a depression.

    I don’t know if there is enough economic knowledge in the country anymore to understand what is happening. The Marxist professors may have succeeded in dumbing down the younger generation. We’ll see.

    Mike K (2cf494)

  30. Patterico:

    “I’m going to stop writing now. The kids are asleep, so I need to find a pillow to scream into. Thanks for reading.”

    It was HARD Difficult IMPOSSIBLE to read this post last night I was busyscreaming in my pillow last night and could only comment this morning.

    GM Roper who wants DRJ back on Patterico's Pontifications (85dcd7)

  31. Do not worry Patterico, he is still a “good man” no?

    Mr. Pink (eae12c)

  32. On NPR this a.m., they discussed one bank’s economist writing that government needed to rescue the financial services industry with much more money or worse things would happen. There was some comment on the order of:

    “That’s a real nice global economy you got there. Yeah, it’d be a shame if something bad would happen to it. Maybe youse should just hand over some money so it don’t.”

    PAYGO’s working, though. Financial restraint. Can you imagine if it were unrestrained?

    Oh, and remember his pledge to get rid of non-working government programs? I wonder how that’s going? Probably major cutbacks soon.

    –JRM

    JRM (355c21)

  33. Patterico, would it be too rude for me to ask what your income is?

    Would it be rude to ask how much you get from the government each month, Andrew?

    Rob Crawford (04f50f)

  34. The evil spendaholic George Bush: U.S. budget deficit hits record $438 billion for year

    Barack Obama? Quadruple it. And tell me again about the “failed policies of the past.”

    Pablo (99243e)

  35. Obama is like the man who sees his neighbor’s house on fire and figures that neither of this close proximity neighbors has enough insurance to rebuild .. so he starts the neighbor’s house on the other side on fire .. in the name of improving the value of his home.
    The only thing left to the imagination is whether the fires on both sides of his house are enough to cause his house to burn to the ground.

    Neo (cba5df)

  36. All of this is happening, and the real panic hasn’t even hit yet.

    Amphipolis (fdbc48)

  37. #28 Mike K:

    University professors (sorry Eric) tend not to be investors (except their pension plans but they haven’t figured that part out yet) so that is not important.

    Actually, as a class, they are. But they are a special class, (ie, 403b and the like) and protected in ways that are unavailable to ordinary investors. They still have to contend with market forces however, and it will be interesting to see if any take heed.

    One of the most maddening discussions I’ve heard in the last year or so (before the market meltdown) was a perfesser in the National Hippie Preserve® agonizing to her friend over whether her investments were socially responsible enough!

    Was all I could do not to exclaim, ‘You stupid cow, be greedy! Go for your own self interests and then your investments will actually have the effect you desire!’ But the moment passed.

    #34 Neo: That is a superb description.

    #34:

    EW1(SG) (e27928)

  38. Oh, Dr. K., I certainly have watched my investments, in and out my retirement program go blooie.

    Hope and Change!

    Eric Blair (8d54e0)

  39. Techie (comment #26, 6:00 am): I like the idea of using scientific notation to underscore the enormity of the budget: 3.55e12 or 3.55 x 1012 dollars. Unfortunately, not too many people understand it, due to the general math illiteracy in this country (thanks, Department of Education, for 30 great years!).

    JVW (7b05c8)

  40. Conversation with an Obamaphile:

    Me: Obama’s budget for 2009 comes out to $25,000.00 for every taxpayer.
    Obamaphile: I don’t want to hear that.
    Me: OK.

    Phone rings back.

    Obamaphile: Should I stop the contributions to [my retirement plan]? I have lost 50% already.
    Me: No. This is the time to buy. Also, your tax rate is 33% and that 33% is money that Obama does not get. It’s deferred. You will not have to pay taxes on it until twenty years from now when a Republican is in the White House.
    Obamaphile: OK. Thank you. That’s what I was thinking, too.

    nk (da8e61)

  41. Aw shoot, the superscript code worked in the live preview but apparently not when the post hits. It should be 10 to the 12th power above, not 1012.

    JVW (7b05c8)

  42. You did know -didn’t you!?- that up to now the Iraq war has not been included in the deficit figures?
    Thanks to Obama now it is, so we have the real numbers.

    Republicans don’t want government to invest, they just want it to spend. Start a war and cut taxes.
    The Club for Nihilism.

    P. Favor (48d752)

  43. You did know -didn’t you!?- that up to now the Iraq war has not been included in the deficit figures?

    The number in my #33, $438 billion, is the real number, calculated on real revenue and real expenditures at the end of the fiscal year. It is not a reflection of budget projections. Obama hopes to only quadruple it. That’s his projection. It’s going to be more than that.

    The real numbers aren’t at all elusive once the spending has been done.

    Pablo (99243e)

  44. “The number in my #33, $438 billion”

    Which as I said, does not include the costs of the war -of either war actually, including Afghanistan- which are kept separately.
    Facts are stupid things. They don’t go away when you want them too.

    P. Favor (34f469)

  45. I am, once again, reminded of a well-used saying from the depths of history (well, the Soviet Union post-Stalin):
    We pretend to work, and they pretend to pay us.

    Welcome to the New, Hope & Change World, Comrades.

    AD - RtR/OS (10cf6d)

  46. por favor sure is persuasive, isn’t he? Baracky has spent more in the first thirty days than we have spent on the wars in Iran and Afghanistan since 2003. lo siento por favor. tu eres estupido.

    JD (0aaaea)

  47. The amount per tax “filer” may be in the range of $25,000. The Guardian columnist uses tax filer numbers. As we know many tax filers do not pay taxes. Many have to file to claim their refundable credits such as EITC. The IRS tables he uses to come up with 138 million tax filers shows that 106 million actually have a tax liability. If you divide that into the $5.5 or $5.6 trillion budget the amount per taxpayer rises to the $33,000 to $34,000 range.

    Phaedrus (419f68)

  48. Which as I said, does not include the costs of the war -of either war actually, including Afghanistan- which are kept separately.

    Yes it does. That is the actual deficit incurred, not the budget, Jeenyus. The U.S. Federal Government collected $2,524 billion in FY2008, while spending $2,979 billion, generating a total deficit of $455 billion. That is a fact, not a budget projection.

    Pablo (99243e)

  49. “Which as I said, does not include the costs of the war -of either war actually, including Afghanistan- which are kept separately.
    Facts are stupid things. They don’t go away when you want them too.”

    - P. Favor

    Dude, just shut the fuck up. I don’t give a shit if you poke your own eyes out that you might See No Evil; the only thing that matters to me is that you do it on your own porch.

    Leviticus (b987b0)

  50. No Pablo, they “excluded” it by paying from their top-secret offshore Halliburton accounts. I know, because I read it on tpmmuckraker, and I committed it to memory.

    God, but Senor Favor es un pinche guey estupido. Vete a la chingada, por favor!

    carlitos (3e7004)

  51. Republican leaders need to point out how much control people will loose after this budget…

    Government will control the car you drive once they have GM and Chrysler
    Government will control what bank you get your money from once they have Citi and BofA
    Government will control what kind of healthcare you get and when you get it
    Government will control how much energy you will use to heat/cool/light your home(cap and trade)
    Government will control your mobility. You can forget those family car trips(cap and trade)

    About the only thing they won’t control is what you eat and when you sleep…

    silypuddy (5b22fa)

  52. The scene from “Planet of the Apes” where Heston sees the Statue of Liberty and cried “You Maniacs! You blew it up! Ah, damn you! God damn you all to hell!” keeps coming to mind lately.

    Oh. come now. That’s not the real line from that film you were thinking of. Why not just get it off your chest and quote the line that really does it for you.

    This is blog is truly becoming more fascinating and twisted by the day, it’s like Never-Neverland and it’s difficult to look away from this group hysteria and denial.

    Peter (e70d1c)

  53. Watching this spendulous bill and the raising of taxes during a severe downturn, I have come to the conclusion that Obama doesn’t care if he destroys us economically.

    He is more interested in imposing his Marxist ideals.

    After all, was Stalin, Mao et al concerned about the prosperity of their people? No, it was of no concern to them. It is of no concern to Obama either.

    Lily (9d9b60)

  54. It is not a good year to be a Kulak, Lily.

    SPQR (72771e)

  55. Patterico, would it be too rude for me to ask what your income is?

    Would it be too rude of me to ask if you still live with your mommmy?

    Dmac (49b16c)

  56. Which as I said, does not include the costs of the war -of either war actually, including Afghanistan- which are kept separately.
    Facts are stupid things

    …and using incomprehensible grammar coupled with inane punctuation can also be quite stupid things. But no matter, please continue.

    BTW, John Adams first stated that quotation, and he didn’t say stupid, Poindexter. The correct word was stubborn.

    Dmac (49b16c)

  57. From Brainy Quotes:

    The tax on capital gains directly affects investment decisions, the mobility and flow of risk capital… the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth in the economy.
    John F. Kennedy

    I posted that quote in the wee hours this morn on my blog. Let’s see the libs fight against one of their own holy saints.

    John Hitchcock (fb941d)

  58. Andrew:

    Patterico, would it be too rude for me to ask what your income is?

    Of course it would be, but more importantly, it would be too dumbass-ish. On what planet do the merits of Patterico’s post depend one iota on whether his annual income is $1,000, $10,000, $100,000 or $1,000,000? His arguments either hold water or they don’t.

    Xrlq (62cad4)

  59. It has become obvious that Obama and the Democrats are using the current economic problems as an excuse for an immense spending increase unrelated to the economy that fulfills long held wishes by the Democrats to take over immense sectors of the economy and remake the old welfare state paradise.

    I just thought we’d have a bad four years because Obama was not up to the job. Its going to be worse, because he’s not up to the job and he intends to wreck havoc on our nation.

    SPQR (72771e)

  60. Xrlq, I was informed last night on Sadly No that liberals make more money and are better educated than conservatives.

    That, and conservatives hate non-whites and are afraid of non-whites.

    That, and any non-white who votes Republican is a race-traitor.

    So there is a world that ties money to words. Just not an honest world.

    And, yeah, I wrote a bit about my experience there.

    John Hitchcock (fb941d)

  61. Not that I enjoy it especially in this context, but yes 455 is the precious deficit number, including the wars.
    Bush funded them through supplementals as a way of obscuring costs but they did of course end up in the final numbers.
    Obama is putting those costs up front.

    On with the show

    P. Favor (34f469)

  62. I’ve been wondering for some time now, is Por Favor Lovey?

    John Hitchcock (fb941d)

  63. Bush funded them through supplementals as a way of obscuring costs but they did of course end up in the final numbers.

    You seem to be unaware of what occurs during debates on this blog – you make an assertion, you back it up with verifiable sources, and not just the voices in your head.

    What a Ponce.

    Dmac (49b16c)

  64. The Iraq war costs were not funded through supplementals to obscure the costs, that is the usual propaganda of the BDS set. They were funded through supplementals specifically because they were not part of the recurring budgeting process. Duh.

    Sheesh, when are going to get some adult trolls?

    SPQR (72771e)

  65. I’ve been wondering for some time now, is Por Favor Lovey?

    If you’re thinking of someone making wild assertions without a scintilla of actual evidence, then I’d say you make a fair comparison.

    Dmac (49b16c)

  66. On with the show

    The Ponce is apparently referring to the doll show he’s currently conducting in his basement.

    Dmac (49b16c)

  67. Meanwhile, the Democrats in Congress are brazenly violating the Constitution by attempting to give the District of Columbia votes in Congress.

    One would think that after all the drooling nonsense from the BDS crowd about how “unconstitutional” the Bush administration’s actions were, we’d hear some howling about this completely unconstitutional proposal.

    But silence.

    Evidently since inauguration day, we’ve been a banana republic without knowing it.

    SPQR (72771e)

  68. Sure, but one could argue (whether you agree or not is a different matter) that deficits are necessary now and weren’t then.

    Patterico (cc3b34)

  69. P. Favor is not Lovey I’m willing to bet. Both are stupid but their focuses are much different and not overlapping for the most part.

    The question about how much money Patterico makes is more telling. In the current climate persons who will “benefit” from the plan are expected to support it and those who do “benefit” (i.e. make more than 250,000) are assumed to oppose it out of raw greed.

    Have Blue (974cdf)

  70. Not something I’m going to discuss. Sorry.

    Patterico (cc3b34)

  71. My wife and I would benefit from this plan, but we’re not in favor of it – at all. We were brought up in families that believed in living within their means, and those lessons are still resonant. Would be that our leaders would do the same – but they’ve never had to operate under a truly pay – as – you – go plan, so no surprise.

    Dmac (49b16c)

  72. Whine all you want about the policies the administration has chosen to get us out of the ditch, but don’t forget HOW WE GOT THERE.

    Turns out, tax cuts aren’t magic. Who knew?

    Not Bush Republicans.

    They still believe that cutting taxes raises revenue, axiomatically.

    We are first and foremost suffering from the collapse of a gigantic credit bubble.

    We overborrowed. Massively.

    How did that happen?

    1. Greenspan kept interest rates artificially low year after year, enabling a long-term pattern of overborrowing at all levels of the economy, from municipalities to businesses to college students.
    Why did Greenspan allow this bubble to develop? Because he felt responsible for ensuring growth after supporting the Bush tax cuts and was willing to stoke growth artificially by holding down interest rates, creating the massive housing bubble.
    The refinancing and home-equity loan boom prevented slow wage growth and even slower jobs growth from sinking the Bush economy back in 2004 and 2005, when that would have also sunk his re-election prospects.
    Greenspan left the punch bowl out long after everyone was too drunk and he did so because he didn’t want the party-goers to realize the economy was in need of deep restructuring.

    2. At precisely the same time homeowners were borrowing more, refinancing and borrowing against any equity they had to buy more made-in-China trampolines for the backyard and made-in-Japan SUVs for the driveway, investment banks were doubling and tripling their leverage on credit derivatives, having convinced themselves that their mathematical models accurately described the risk in that as acceptable.
    Greenspan was here too, telling anyone who’d listen — which was everyone, certainly including yours truly — that credit derivatives were a shiny new magic fist of the marketplace that no one need to fear.
    Of course, the legal limit on leverage was lifted at the Bush administration’s behest in 2004, after which banks like Bear Stearns and Lehman pumped up leverage to more than 30 to 1, doubling the profitability of big bets on so-called synthetic collateralized debt obligations.
    Without big leverage, those bets don’t work. The banks would not have, indeed could not have, made those bets and there would have been no crisis.

    We might be, would probably be, in a seriouis recession right now, but it would not be anything near the global banking collapse we’re now in the midst of.

    Given the dimensions of this collapse, does the Ayn Rand for Dummies crowd really believe that standing back and letting the magic fist of the free market flail away is the best policy option?

    I’m as concerned as anyone about higher taxes, but I also know that credit and banking are absolutely essential infrastructure. Credit is like water and, at the moment, there is no pressure in the system, so water isn’t flowing.

    Unless and until you can come up with a better way — than pumping fresh money — to solve that problem, whinging about taxes is pointless.

    Hax Vobiscum (edacf7)

  73. Sniff. John, did you pass gas over on this thread, too?

    Eric Blair (8d54e0)

  74. Economic ignorance will be the downfall of the Republic.
    Congratulations to the accomplishments of the public-education establishment.

    AD - RtR/OS (5e419c)

  75. And…I did have a small comment on the actual post.

    I think I admire your courage, Pat, in taking on this subject.

    It’s a good demonstration of the value of a concern in establishing facts, even at the risk of provoking hurricane-force emotions.

    Child rape and the death penalty: so many people are going to dig in their heels on those issues and comfort themselves with the belief that their position is the moral high ground, facts or no facts.

    I too have a lot of questions about the case and Balko’s write up on it. I’ll wait, though, for Reason’s next installment on it and then, perhaps, see if they’re answered…

    Hax Vobiscum (edacf7)

  76. It’s those spuds, the eyes that cannot see.

    AD - RtR/OS (5e419c)

  77. Boy, talk about being lost?

    AD - RtR/OS (5e419c)

  78. Hax, old boy, you’re making an ass out of yourself again. Plus, you know nothing about the economy except what you’ve read of lefty talking points, which means you know next to nothing and all of it is wrong.

    Carry on.

    daleyrocks (ae34ca)

  79. Hey, daley: what is faux-Latin for “passive aggressive insulting hypocritical snob of a ponce”?

    I’m just asking questions.

    Eric Blair (8d54e0)

  80. Humungous Foppish Douchebagus.

    Dmac (49b16c)

  81. Perhaps the “deregulation” he refers to is the unregulated market of credit-default swaps. This was a derivative security that banks and investors used to insure against credit defaults. He should know that former Secretary of the Treasury Robert Rubin, described by President Clinton as the greatest treasury secretary since Alexander Hamilton, pushed his Citigroup bank to pursue these instruments and aggressively invest in sub-prime mortgages. Today, Citigroup is on the verge of bankruptcy. Prior to Citigroup, Mr. Rubin was with Goldman Sachs. (Former Treasury Secretary Paulson was also with Goldman Sachs. Wonder if they knew each other.)

    SPQR (26be8b)


Powered by WordPress.

Page loaded in: 0.4081 secs.