Patterico's Pontifications

1/3/2011

Goolsbee’s Reduction to Absurdity (Updated)

Filed under: General — Aaron Worthing @ 7:55 am



[Guest post by Aaron Worthing; if you have tips, please send them here.]

Try this sometime.  Go to your local bank.  Tell them that you need a loan.  They will ask why, in one way or another.  When they ask why, explain to them that you already have a massive loan to someone else that you will not be able to repay unless you get this loan from them.  When they ask how you got that loan in the first place, then explain to them that this loan was taken out because otherwise you couldn’t have paid a previous loan.

And when they ask how you plan to pay off this loan, explain to them that surely someone else will loan you that money.

Then, let me know in the comments when they stop laughing at you.

But what is reductio ad absurdum (reduction to absurdity) in the real world, is considered responsible policy for chairman of the White House Council of Economic Advisers.  On ABC’s This Week, he explained that we have to raise the debt ceiling and allow us to go into more debt, or else we will default on other debts.

Yes, really.

Top White House economic advisor Austan Goolsbee warned Sunday that a congressional failure to rise the nation’s debt limit early this year would be “catastrophic.”

“It pains me that we would even be talking about this,” Goolsbee told ABC’s “This Week.”

“This is not a game. You know, the debt ceiling is not something to toy with. … If we hit the debt ceiling, that’s essentially defaulting on our obligations, which is totally unprecedented in American history. The impact on the economy would be catastrophic. I mean, that would be a worse financial economic crisis than anything we saw in 2008.”

The current debt limit is $14.3 trillion, which Washington is expected to hit in February. A failure to raise the ceiling would prevent Congress from borrowing funds to pay the country’s obligations. Some conservatives — notably many in the incoming class of Tea Party-backed Republicans — are threatening to vote against raising the cap, arguing that the U.S. simply can’t afford to rely so heavily on borrowing.

So the only way to meet our obligations and thus to make timely payments on our national debt…  is to go further into debt?  Does Goolsbee have a plan for finally, actually, paying off this debt out of our own funds?

It’s coming up in February and no, you can’t turn the ship of state around on a dime.  So I say give them enough for three months of reprieve.  And then the day of reckoning.

Either we will finally as a nation figure out how to live within our means.  Or we will eventually default.  And if a default is in our future, its better to come now than later when it would be even worse.

Anyway you can watch Goolsbee and Congressman Weiner acting like, well, wieners, here:

You can read more at The Blaze.

Also in other news, George Will apparently doesn’t understand that private industry is the primary mover in useful science.  He starts off his column yesterday with this:

New Republican legislators should come down Capitol Hill to the National Museum of American History, which displays a device that in 1849 was granted U.S. patent 6469. It enabled a boat’s “draught of water to be readily lessened” so it could “pass over bars, or through shallow water.”

The patentee was from Sangamon County, Ill. Across Constitution Avenue, over the Commerce Department’s north entrance, are some words of the patentee, Abraham Lincoln:

THE PATENT SYSTEM ADDED

THE FUEL OF INTEREST

TO THE FIRE OF GENIUS

Stoking that fire is, more than ever, a proper federal function, so the legislators should be given some reading matter.

From there he goes on to argue that this means the Federal Government should directly fund science.  But a patent is not a government subsidy in any traditional meaning of the word.  Instead it is a property right, created in one’s ideas, granted in order to encourage a person to come up with valuable ideas.  Thus if you come up with the next great innovation and sell it to the people, you will be a rich man—which is why both individuals and corporations are constantly engaged in useful research.

And the thing is that it forces would-be inventers to do a cost-benefit analysis.  They have to ask themselves: “would this be useful to people?  Can I convince them to buy what I make?”

By comparison government scientist can be entirely theoretical with little hope of practical application, because the goal isn’t to sell anything to the public, but to the people giving the grant.  And in fact by paying scientists to do useless, theoretical science, we actually drain brainpower away from useful applications and thus harm economic growth.

Now to a certain extent this is still a justified expense.  For instance, although many innovations arose out of our trip to the moon the fact is that the whole concept was monumentally unprofitable.  Even when talking about private space travel, generally the context is in some kind of X prize, where it is made artificially profitable.  But I think we can all agree that it is good that we went to the moon, right?

But let’s not pretend, as Will does, that the reason for the government to fund science is because of its great efficiency.  Patents do that.  Subsidies, if anything, harm the advancement of profitable science. Subsidized science serves other purposes.

Updates: Two interesting and timely stories. First, apparently us gamers are the vanguard of science these days, pushing technology forward. You’re welcome.

Second, the WaPo fears that reduced spending will harm the D.C. economy. Um, as a D.C. resident, we will survive.

[Posted and authored by Aaron Worthing.]

61 Responses to “Goolsbee’s Reduction to Absurdity (Updated)”

  1. Someone commented on this by saying it was a good thing that the White House had ABC to send its third stringers to go get some experience where no one was watching …

    SPQR (26be8b)

  2. Anti-sciene denier!!!!

    What is really amusing is that Scary Larry O’Donnell has been pushing this debt ceiling crisis meme since election night. Even more so since Boehner has all but said it will pass quickly. It never occurs to the Goolsbee’s of the world to quit spending, or to address anything that led to the “crisis”.

    JD (6fed24)

  3. The republicans should call the democrats bluff; call for a reduction in entitlement spending equal to the amount of the debt ceiling increase. Problem solved.

    As for government funded science, no one should ever expect it to be profitable on it’s own. That does not mean that spinoff’s from those discoveries can’t be profitable. No private business could have justified the research in to atomic fission for the purposes of creating electrical power generation. One can make the same argument for radar, computing, jet engines among others. All developed for the military and then on to great commercial success.

    Does this mean that there can be no advancement without government funding of science? No. It simply means that there is more than one track to the advancement of science and that the tracks are not mutually incompatible.

    cubanbob (409ac2)

  4. In other entertainment news, the runaway movie hit is “Avatar,” a futuristic epic about humans who travel to an alien planet to mine a precious mineral that they believe will give them the power to emit believable dialogue.

    We spent the last two years with a Congress and Administration also on a quest for “Unobtainium.” If it weren’t so expensive, the similarities would be laughable.

    Neo (03e5c2)

  5. The Tea Party new blood are not going to give in, nor should they.Don’t get coopted by the Old Guard fools who led us here in the past. How hard is it to tell Trent Lott to go comb his hair again? Not one more dime of borrowing without at least cutting an equal amount of spending.

    Bugg (4e0dda)

  6. It’s so obvious we need deep spending cuts, that to call for more spending is simply unpatriotic.

    Those doing that care about something else more than their country.

    In fact, if we start cutting spending and borrowing, I suspect confidence will grow, leading to more lending and investing and jobs. We’re clearly unsustainable, following years of bad fortunes and sour predictions. We’ve got to make it seem like maybe we won’t collapse financially before the economy will thrive again.

    Why does this stuff need to be explained? A lot of lefties think the way out of this mess is for someone to invent an ‘epoch changing technology’. They are escaping to a fantasy instead of gutting precious democrat programs.

    Dustin (b54cdc)

  7. Milton Freidman’s ghost is ashamed that an utter hack tool like Ghouls – be is from the U of C.

    Dmac (498ece)

  8. This is so early to be in a george herbert walker bush situation. Remember how “no new taxes” turned into a club against him in ’92?

    “No increase in the debt ceiling” will be used against the repubs in 2012 if they increase this now.

    There is no point in having principles if they are only good for a month and a half.

    I can think of many things that I would stop payment on. I am sure the pols know more about what’s available than me.

    Jim (844377)

  9. Will’s column does illustrate his provincialism in regarding “elite universities” to be the source of scientific advances. Craig Venter, the most ambitious and successful scientist now working came from UC San Diego. There are lots of good engineering and hard science programs at state colleges.

    I do agree with his point but the global warming fiasco is eroding the public’s confidence in science. I have more here .

    Mike K (568408)

  10. Mike K’s blog link is a great read.

    I particularly agree on two points: that US engineering programs are strong all over the country, and that we should limit aid to majors that do not benefit humanity very much. It’s nice to have history and english majors, but only a tiny handful of people in those majors manage to improve our lives as much as a chemist does (and those people are naturally gifted and would have risen to the top by merit).

    Engineers should keep the academic high bar to entry, but I would love it if they paid far less for their education than a Sociology or music major does.

    Dustin (b54cdc)

  11. Maybe we can get a loan from Greece, or Portugal, huh?

    mojo (8096f2)

  12. I can think of many things that I would stop payment on.
    Comment by Jim

    I think when most Americans are tight on cash, the first things to go are expensive vacations and food expenditures (hamburgers instead of steak, beans instead of hamburgers, and no caviar).

    Just saying

    MD in Philly (3d3f72)

  13. MD

    > beans instead of hamburgers

    That will help us with domestic natural gas production, too.

    Aaron Worthing (e7d72e)

  14. “No increase in the debt ceiling” will be used against the repubs in 2012 if they increase this now.

    Really? Who made such a stupid promise? No Republican that I ever heard of.

    I can think of many things that I would stop payment on.

    Really? We have obligations. Paying them is not optional. Perhaps previous Congresses were foolish to take on those obligations, but they did, and they pledged the faith and credit of the United States against them. Nor can we argue that they had no right to do so; the constitution clearly gave them the right. So what choice do we have but to pay up? And to do so we must raise the debt ceiling; we have no other way to pay what we must. If you would default on our debts then you are without honour. And how do you suppose the voters will respond to that?

    Milhouse (ea66e3)

  15. Maybe we can get a loan from Greece, or Portugal, huh?

    There is no shortage of people willing to lend us as much as we want to borrow. Thank God our faith and credit are still good in the world, and will remain good for as long as we don’t welsh on our debts. Living off the credit card is far from ideal, and we definitely have to cut spending, but in the meantime we can’t just refuse to pay our bills.

    Milhouse (ea66e3)

  16. Milhouse

    > We have obligations. Paying them is not optional.

    Are you really going to tell me it is impossible to cut spending enough to pay those obligations without going further into debt?

    Because if that is the case, then we are officially insolvent as a nation. And then we might as well default now, before it gets worse.

    Aaron Worthing (e7d72e)

  17. milhouse

    > Living off the credit card is far from ideal, and we definitely have to cut spending, but in the meantime

    in the meantime? When exactly are we going to stop this spending insanity?

    Aaron Worthing (e7d72e)

  18. Milhouse, explain why raising the amount we have borrowed is required to pay what was previously borrowed.

    SPQR (26be8b)

  19. I think when most Americans are tight on cash, the first things to go are expensive vacations and food expenditures (hamburgers instead of steak, beans instead of hamburgers, and no caviar).

    Just saying

    Comment by MD in Philly

    I feel very out of touch, even though I’m far from wealthy, about what it means for Americans to be poor.

    Cars last forever. Entertainment is not expensive. If you prepare the food yourself, it’s really not that expensive, and if you don’t, it’s still pretty cheap if you eat junk.

    when I think of poverty, I think of soup lines and people wearing the same clothes for weeks, but Americans have cell phones and multiple televisions.

    Obviously, if you can’t get a job, your income is nothing and you can’t afford a can of beans, but we’re talking about a much lower percentage of people in this category than we had during the periods I consider hard times.

    Are we talking about people who are skipping that trip to Hawaii and grilling burgers instead of Waygu? That’s the category I’m in, and frankly I’m very happy.

    Dustin (b54cdc)

  20. And then we might as well default now, before it gets worse.

    Comment by Aaron Worthing

    that’s great logic.

    If we’re really in such bad shape that we have no choice but to live off our credit cards, it’s not actually helping us to live off our credit cards and collapse with yet more debt than we have now.

    The hard truth is that our nation would persist and perhaps thrive if the federal government cut spending much farther than anyone realistically predicts it will. This debt, this year’s deficit, next year’s are choices. We can wait for some miracle recovery, or we can make it happen via choices.

    Dustin (b54cdc)

  21. Dustin

    see the update. we are apparently the vanguard of innovation.

    Aaron Worthing (e7d72e)

  22. Re: update. What a horror, the parasites might starve …

    SPQR (26be8b)

  23. It’s very simple. The T-bills have come due and there’s nothing in the till with which to pay them. The only way to pay them is to borrow more; there is no money tree. It’s unfortunate, but it’s reality. How we got here is another story; but we’re here all the same. Unless you’re prepared to balance the budget immediately, total debt must rise before it can come down. And of course the higher the debt the higher the interest on that debt, which leaves less room for spending cuts. We’re in a bind, but stopping our ears and refusing to pay our debts is not an answer.

    And more to the point, Juan’s contention that the public will hold it against the GOP if they break their promise not to raise the debt ceiling is nonsense, because there was no such promise. It would have been a foolish promise to make, and fortunately nobody made it.

    Milhouse (ea66e3)

  24. The WaPo is the local paper, so it’s entitled to parochial fears.

    Milhouse (ea66e3)

  25. Very interesting story, Aaron. The economies of scale are amazing when put to use. Games are evolving at an incredible rate.

    I’m still amazed at how financially successful video games have become over the past several years, but it’s a better medium.

    And going back to my other comment, it’s really not that expensive. A $50 game can entertain you for a very long time, compared against a $20 movie. These systems can serve as a fitness consultant, too.

    When people complain about how hard our economy is (and for the funemployed, I agree things are grim), I think it’s important to note that a lot of ‘poor’ people live a relatively good life.

    Dustin (b54cdc)

  26. Milhouse, that sounds reasonable, but it’s still a good thing that voting to raise the debt ceiling will carry a political cost, and that cost will increase, so there should be great pressure to balance the budget as quickly as possible. Otherwise, we will always run into the situation we are in now, where we either up the limit and dig a deeper hole, or we default.

    It isn’t as though most of the members who will vote to increase the ceiling aren’t at fault for when they didn’t balance the budget. No one is surprised this is happening now, or will happen again in April.

    I hope a lot of Tea Partiers vote against the change, and the fear of a default in coming months gets us closer to a sustainable path, which is the only way to recovery.

    Dustin (b54cdc)

  27. Dustin

    Well, the value depends on the game and how you use it. I mean when you hear about a gorgeous game that has a campaign that last five hours, it kind of pisses you off they expect you to spend $60 for it.

    But there are some developers who really try to give you alot for your buck. right now i am working through red dead redemption again, and its amazing how you can suck away the hours just creeping through the wilderness and shooting every animal that has the misfortune to encounter you. it would be conservative to say i spent 60 hours in that world, so that works out to around $1 an hour, cheap as crap compared to a movie ticket.

    The hilarious thing right now is I managed to snag rock band 2 for only $35 (because its the last iteration) and my wife has gotten into it for the first time. i assumed she would enjoy singing, but in fact what she really loves is guitar. which is freezing me out of the fun until amazon delivers a second guitar to me.

    Aaron Worthing (e7d72e)

  28. milhouse

    i will grant that you can’t fix it by february. there is too much that has to be done to slow this spending machine down. but if we can’t fix it by may, i have no believe we are ever going to fix it. we have to get control of this and NOW.

    Aaron Worthing (e7d72e)

  29. Milhouse, if the t-bills are “due”, then the Treasury can issue more to pay them off without raising the debt ceiling.

    The debt ceiling must be raised only to accomodate more spending, not to pay on old debt.

    SPQR (26be8b)

  30. When did cutting spending and payinmgng obligations get conflated?

    Xbox360 Kinect rocks.

    JD (109425)

  31. I hated all the Eye and Eyetoy games, not just because they barely worked, but because the idea of waving my arms around to control the game gets really old. I agree with the Kevin Butler advert about needing buttons, and even the Eyetoy games that let you use the Dualshock didn’t work well.

    Maybe I’m just out of step. It’s amazing what Kinect (at least in theory) can do (I realize it’s an evolution beyond a simple camera, just like the Move is an evolution over the wiimote). I’m really interested in seeing just how far they take that technology. Fitness games fascinate me, and this kind of thing is the future. 3D + Kinect + an online competition could have my swordfighting or boxing a real person.

    All of this is a lot more interesting than watching DC implode the dollar. One nice bonus for the 360 is that it’s American, so maybe it will be affordable after the dollar crashes and PS3s cost $10,000 (I’m joking).

    Dustin (b54cdc)

  32. 3D Kinect would be cool beyond words.

    JD (0d2ffc)

  33. Toshiba is innovating a better 3D system that doesn’t require glasses. It coincidentally would be well suited to a system that can track where the viewer is, and Toshiba is almost bitter in its competition with Sony, just as MS’s games division is.

    Just give it a few years, JD.

    I’m very happy with my PS3, but I know that’s mainly because of stiff competition, so I’ll look forward to Kinect taking off.

    Dustin (b54cdc)

  34. If we don’t raise the debt ceiling, or give indications that we won’t do so, the people buying US debt will get concerned and start demanding higher interest rates to compensate for the additional risk. Right now, at historically very low interest rates, the interest payments represent roughly 8% of our GDP. That could easily double to 16% if you give potential buyers cause for concern.

    Jimbo (87e69d)

  35. dustin

    ah, microsoft is a bunch of a55holes. sorry, can we get a version of windows that actually works better? or how about a console that doesn’t crap out with a red ring of death?

    that being said, but that post i did on the x stories we all got wrong, includes a link to a cracked story that talks about kinnect and its possibilities. but i am like, “mmm, doubt it really can live up to the hype.”

    incidentally, it will allow you to use an xbox controller at the same time.

    but i would rather shoot with a wii or a move, right now.

    Aaron Worthing (e7d72e)

  36. to be honest, I am also pretty hard on MS, Aaron. It’s one of the American companies that remains great, but sometimes… I just can’t avoid finding their products to be annoying.

    But while Kinect isn’t for me, I admit I’m in awe of the possibilities. It probably won’t live up to the hype yet, but maybe in a few years. I tried one and it didn’t track my motion well, though I’m sure when it works it’s fun.

    Shooting with a Move controller is excellent. It’s annoying to calibrate more than once, but it is simply the perfect motion interface.

    What’s amazing is that we’re seeing tremendous success in a number of directions in this field. The wii’s fitness board, your wife’s guitar controller, cameras and motion sticks, and of course, just normal gamepad oriented games.

    It’s just exploding in 100 directions.

    Dustin (b54cdc)

  37. Dustin

    hey, that’s MY guitar controler. she’s just borrowing it. just like my niece has been borrowing my vhs copy of Toy story like for over 10 years now and…

    crap.

    joking aside, you have to give it to sony for being the first to be really experimental with their console. if it wasn’t for having their massive install base with the ps2 (100 million units) a company like red octane could never have tried something as radical as guitar hero. and there couldn’t have been a karaoke revolution, and numerous other things that opened the door. not to mention games as experimental in design as shadow of the colossus.

    Aaron Worthing (e7d72e)

  38. Agreed, Aaron. Nintendo did not wear the mantle of console leadership very well, and stifled competition. In fact, they refused to give Sony ownership on Sony games for the SNES+CD concept. Sony welcomed competition and that’s their core strength and something I think MS has been wise to follow.

    Things like the game wand idea, the camera tracking your movement idea, the guitar idea… that all started development for the PS2 because it was an environment where any good idea could make money.

    And the PS3’s sold what… 41-42 million? The 360 has sold 45 million or so?

    I don’t begrudge what MS has brought to the table in an online atmosphere. That’s my favorite thing about games these days, and it drastically increases the entertainment value. I do worry what the industry would be like if MS enjoyed dominance as they do in office productivity and OS, but I don’t think that will happen simply because the emerging markets are Asian.

    Dustin (b54cdc)

  39. Another point is that it looks like MS was very smart to sink tremendous costs into gaming. They are much more viable this way. Google could really cramp their model with web oriented OS and Office software, but MS has a great phone architecture and millions of loyal Halo gamers.

    Frankly, I prefer MS to Google on a gut level, perhaps as the devil I know.

    Dustin (b54cdc)

  40. Instead it is a property right, created in one’s ideas, granted in order to encourage a person to come up with valuable ideas.

    I challenge this construction. The judge who ruled thus is wrong. A Patent is a monopoly, granted as a quid pro quo to induce an inventor to publish.

    LarryD (f22286)

  41. larryd

    the two are not mutually exclusive. the property right creates the monopoly.

    this isn’t even a controversial thesis. what do they call the concept of copyrights, patents and trademarks? intellectual property.

    Aaron Worthing (e7d72e)

  42. While it’s true in one sense that patents are a property right, it’s also true that they’re a state-created monopoly. That is to say: the right to exclude others is entirely a grant of the state, as an incentive to engage in behavior the state desires; this is distinct from most physical property, where physical possession by definition entails the power, if not the right, to exclude.

    But mostly I find the description of patents as property to be misleading. That is: asserting that patents on property in some sense asserts that inventors have a natural right to exclude (as opposed to use), but a more accurate description is to say that inventors have a natural right to use and a state-granted right to exclude.

    The questions which follow from that are: when, and under what terms, should the state grant such a right?

    And why isn’t it appropriate to characterize the granting of the right to exclude – and the inevitable financial gain from the exercise of that right – as a subsidy?

    aphrael (9802d6)

  43. LarryD and aphrael are right: “intellectual property” is a bastard term that should never have been allowed into the legal lexicon. Patents and copyrights are legal grants that behave like property, so it makes sense to lawyers to call them that, but it encourages people to think of them as actual property, and therefore as something to which the holders are morally entitled. Suppose Congress were tomorrow to cancel all patents and copyrights, or to restrict their term to 14 years; would that be within its power? Of course it would. And yet the creative community would be up in arms, seething with moral outrage at the “confiscation” of its “property”, and millions of naive conservatives and libertarians would support them, out of an ill-thought-out feeling that this was some sort of communist coup.

    The difference is clear, though: property is one of the liberties which pre-exist all government, and which governments are created to protect. A government that fails to protect people’s property is no more legitimate than one that fails to protect their lives or their liberty. But copyrights and patents do not pre-exist goverenment. On the contrary, as the US constitution specifies, they are gifts and creations of that government, and therefore the same government that granted them has the right to abolish them on a whim.

    Also, property does not exist for a purpose; it’s a primary value, and exists for its own sake. But “intellectual property” exists for one purpose and one purpose only: to encourage the useful arts and sciences. Congress has no power to grant patents and copyrights for any other purpose. That’s why works that involve no creativity at all, such as telephone directories, cannot be subject to copyright.

    aphrael asks, though, why in that case they cannot be called a subsidy. The answer is simple: they don’t cost the taxpayer anything. Nor is their economic effect all that much like a subsidy; a work may be copyright, but if it doesn’t sell then the creator will get nothing from it. IP encourages people to create, but only to create works for which there is a market.

    Milhouse (ea66e3)

  44. We have obligations. Paying them is not optional.

    You should run for the legislature here in IL – they just lurve this line of reasoning. “We voted for this and put the entire state into a financial crisis, and now all of YOU have to pay more taxes in order to make it good.”

    Dmac (498ece)

  45. BTW, states like IL and CA have been getting killed in businesses moving the hell out of high – tax and spend states, which means a lot less businesses overall are left to tax. Which leads to even more high taxes. There is not other endgame but complete and utter insolvency, no matter how you slice it.

    Dmac (498ece)

  46. If they aren’t going to fix spending now, we are going to default at some point, so let’s default early and at the lowest debt level we can.

    Alternatively, we can pass a debt ceiling attached to repeal of Obamacare, reform of social security, and a balanced budget amendment. I’m not kidding. Put it all on the table. We have a winning hand and should go for broke, because it’s that urgent. If the democrats really mean what they say, they will vote for the deal.

    Dustin (b54cdc)

  47. Dmac, the latest colume by VDH used the number of 3000 people/week moving out of CA (Net?), and a lot of them are business owners.

    AD-RtR/OS! (b8ab92)

  48. Anyone with good google skills able to find what Obama said about raising the debt ceiling in 2006?

    JD (07faa1)

  49. Mr. President, I rise today to talk about America’s debt problem.

    The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. Government can’t pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our Government’s reckless fiscal policies.

    Over the past 5 years, our federal debt has increased by $3.5 trillion to $8.6 trillion. That is “trillion” with a “T.” That is money that we have borrowed from the Social Security trust fund, borrowed from China and Japan, borrowed from American taxpayers. And over the next 5 years, between now and 2011, the President’s budget will increase the debt by almost another $3.5 trillion.

    Numbers that large are sometimes hard to understand. Some people may wonder why they matter. Here is why: This year, the Federal Government will spend $220 billion on interest. That is more money to pay interest on our national debt than we’ll spend on Medicaid and the State Children’s Health Insurance Program. That is more money to pay interest on our debt this year than we will spend on education, homeland security, transportation, and veterans benefits combined. It is more money in one year than we are likely to spend to rebuild the devastated gulf coast in a way that honors the best of America.

    And the cost of our debt is one of the fastest growing expenses in the Federal budget. This rising debt is a hidden domestic enemy, robbing our cities and States of critical investments in infrastructure like bridges, ports, and levees; robbing our families and our children of critical investments in education and health care reform; robbing our seniors of the retirement and health security they have counted on.

    Every dollar we pay in interest is a dollar that is not going to investment in America’s priorities. Instead, interest payments are a significant tax on all Americans–a debt tax that Washington doesn’t want to talk about. If Washington were serious about honest tax relief in this country, we would see an effort to reduce our national debt by returning to responsible fiscal policies.

    But we are not doing that. Despite repeated efforts by Senators CONRAD and FEINGOLD, the Senate continues to reject a return to the commonsense Pay-go rules that used to apply. Previously, Pay-go rules applied both to increases in mandatory spending and to tax cuts. The Senate had to abide by the commonsense budgeting principle of balancing expenses and revenues. Unfortunately, the principle was abandoned, and now the demands of budget discipline apply only to spending.

    As a result, tax breaks have not been paid for by reductions in Federal spending, and thus the only way to pay for them has been to increase our deficit to historically high levels and borrow more and more money. Now we have to pay for those tax breaks plus the cost of borrowing for them. Instead of reducing the deficit, as some people claimed, the fiscal policies of this administration and its allies in Congress will add more than $600 million in debt for each of the next 5 years. That is why I will once again cosponsor the Pay-go amendment and continue to hope that my colleagues will return to a smart rule that has worked in the past and can work again.

    Our debt also matters internationally. My friend, the ranking member of the Senate Budget Committee, likes to remind us that it took 42 Presidents 224 years to run up only $1 trillion of foreign-held debt. This administration did more than that in just 5 years. Now, there is nothing wrong with borrowing from foreign countries. But we must remember that the more we depend on foreign nations to lend us money, the more our economic security is tied to the whims of foreign leaders whose interests might not be aligned with ours.

    Increasing America’s debt weakens us domestically and internationally. Leadership means that “the buck stops here.” Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.

    I therefore intend to oppose the effort to increase America’s debt limit.

    -Senator Barack Obama

    (He then voted against an increase in the debt ceiling despite the same problems with doing so that exist today). This reminds me a lot of how he opposed Bush’s judicial nominations, even though it’s even more blatant in this case.

    Dustin (b54cdc)

  50. Meant to block quote that instead of hyperlink it.

    Dustin (b54cdc)

  51. His f@cking hypocrisy knows no bounds. Good job, Dustin. That was quick.

    What would Austin Powers Goolsbee say to Teh One.

    JD (07faa1)

  52. Obama put the “light” in “lightweight”.

    SPQR (26be8b)

  53. It would be freaking hilarious if the House membership would repeat this speech, over and over, just updating the figures.

    What’s really disturbing is how he chides Bush for things that Obama is obviously drastically worse on.

    He talks about how extreme it was for the federal government to run up 1 trillion in debt over 5 years. 5 years that included 9/11 and 2 wars, and at a deficit of $200 billion per year, obviously.

    Imagine if we could simply return to a $200 billion deficit per year.

    JD’s right. Obama’s hypocrisy is historic and awesome.

    Dustin (b54cdc)

  54. It took Barcky a couple months to do what Bush the Evil did in over 5 years.

    JD (07faa1)

  55. The only one with more authority and/or credibility on economic matters than our good friend Austan is,
    well, just about everybody (Christina Romer excepted)!

    AD-RtR/OS! (ab7109)

  56. Goolsbee was one of the designated liars during the campaign. Remember his discussions with Canada?

    JD (07faa1)

  57. Are we talking about people who are skipping that trip to Hawaii and grilling burgers instead of Waygu? That’s the category I’m in, and frankly I’m very happy.
    Comment by Dustin

    The point I was trying to make is when the “typical middle class American” is getting crimped in the budget, most do forego the trip to Hawaii for something closer and make daily expenditures like food a bit cheaper. So, if the American in Chief is worried about his credit limit, maybe he should rethink his vacation plans and menus for his frequent parties.

    MD in Philly (3d3f72)

  58. But, Doc, that would be diminishing the image of THE PRESIDENT!

    AD-RtR/OS! (ab7109)

  59. AD, I was simply hoping to put a few smiles on faces with the veiled reference.

    MD in Philly (3d3f72)

  60. MD, as usual you were clear on the first try. And you’re right… it’s really amazing how extravagantly our President is living during times when many are cutting back.

    I’m just musing about the general issue of what it means for America to be in a downturn today. Even with politics being pretty lousy and the nation’s finances being absurd, it’s hard not to appreciate how good life is in America today. Not a contradiction of your very good point that Obama really needs to try doing some work instead of goofing off all the time.

    Dustin (b54cdc)

  61. Dustin you’re right. There are people who are in desperate situations in the US, but only in the US can a person have a shelter, running water and electricity, and cable TV and be considered “poor”.

    On the other hand, I don’t think most of the country would/will do real well being poor by 1930 standards.

    MD in Philly (3d3f72)


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