Obama: Going $800 Billion Further in Debt Is Part of What This Election Was All About!
So there’s going to be a whole range of approaches that we have to take for dealing with the economy. My bottom line is to make sure that we are saving or creating 4 million jobs, we are making sure that the financial system is working again, that homeowners are getting some relief.
And I’m happy to get good ideas from across the political spectrum, from Democrats and Republicans.
What I won’t do is return to the failed theories of the last eight years that got us into this fix in the first place, because those theories have been tested and they have failed. And that’s part of what the election in November was all about.
The election was about incurring $800 billion dollars of government debt? Allow me to remind you of your previous position — the one suckers believed when they voted for you. Under a headline titled “Restore Fiscal Discipline to Washington” you said:
Obama and Biden believe that a critical step in restoring fiscal discipline is enforcing pay-as-you-go (PAYGO) budgeting rules which require new spending commitments or tax changes to be paid for by cuts to other programs or new revenue.
Another promise under the bus.
So what we need to do is double down on them…which is totally different.
Pablo (99243e) — 2/10/2009 @ 7:17 amHe’s sort of pompous.
happyfeet (71f55e) — 2/10/2009 @ 7:18 amI suppose Baracky will be able to show us where he has propose cutting almost a trillion dollars, or closed almost a trillion dollars in corporate tax loopholes.
Let’s be clear, this is just a warm-up for what is to follow. He is just softening us up.
JD (815958) — 2/10/2009 @ 7:26 amPablo has it right here. Bush bears some of the blame for the collapse because his Federal Reserve left interest rates too low for too long, contributing to the lending frenzy and real estate bubble. Some of this was reaction to 9/11 and the almost simultaneous collapse of the dot com bubble. Some of it was to facilitate the cost of the Iraq War, somewhat like LBJ and his “guns and butter” analogy. OK. That was a mistake.
How does borrowing a trillion dollars and throwing it at condoms purchases and Capital Mall reseeding improve on that ?
James Glassman today quotes Keynes on what could constitute a fiscal stimulus.
If the Treasury were to fill old bottles with bank notes, bury them at suitable depths in disused coal mines which are then filled to the surface with town rubbish and leave it to private enterprise on well-tried principles of laissez-faire to dig the notes up again, . . . there need be no more unemployment and with the help of the repercussions, the real income of the community would probably become a good deal larger than it is.
That sounds like an improvement on Obama and Pelosi’s plan. At least it would use private enterprise for some of it.
Mike K (2cf494) — 2/10/2009 @ 7:30 amPablo, precisely right.
Both Bush and Obama have the same fallacy that it’s better for government to take massive action, no matter whether it makes any sense, than do nothing.
In reality, doing nothing would have been much better than spending hundreds of billions for a “stimulus” (drunken spending binge) that will be temporary at best, and when it passes leave the country more indebted than before.
Hair-of-the-dog economics.
Bradley J. Fikes, C. O.R., who wants DRJ back! (0ea407) — 2/10/2009 @ 7:33 amI thought he was a “pompous little f*ck,” happyfeet? Are you just so offended he sounds careful and measured like an NPR host!!111Eleventy.
As for the body of the post, yeah, patterico, every economist in the world says in a recession the government should stop spending money too. Even W didn’t stop spending money. He just cut taxes, so his base could afford more Cayman Island bank accounts.
I suppose the election was not about the current economic crisis….except that before the crisis, McCain was running largely even and after the country heard the difference between them, it elected Obama by 8 points.
Carry on with the ad hominems, boys.
timb (a83d56) — 2/10/2009 @ 7:34 amCriticizing OBiden for blatantly breaking their promises is soooooooo ad hominem.
Bradley J. Fikes, C. O.R., who wants DRJ back! (0ea407) — 2/10/2009 @ 7:38 amBush bears some of the blame for the collapse because his Federal Reserve left interest rates too low for too long, contributing to the lending frenzy and real estate bubble.
that’s not true.
happyfeet (71f55e) — 2/10/2009 @ 7:39 amBarney Franks was part of Bush’s base?
kaf (16e0b5) — 2/10/2009 @ 7:39 amTimmah appears to be arguing with the voices in his head again today. Shocka.
JD (815958) — 2/10/2009 @ 7:41 amBush bears some of the blame for the collapse because his Federal Reserve left interest rates too low for too long, contributing to the lending frenzy and real estate bubble.
Whether it is true or not, that excuse is only going to play so long. Obama will own this economy soon. Jimmy Carter could only blame Ford and Nixon so much.
Joe (17aeff) — 2/10/2009 @ 7:44 amPatterico says it best, using one of their campaign quotes.
This is high-level robbery of the American taxpayer. Robbery with twelve zeros.
Vermont Neighbor (ab0837) — 2/10/2009 @ 7:48 am“Bush bears some of the blame for the collapse because his Federal Reserve left interest rates too low for too long, contributing to the lending frenzy and real estate bubble.”
That would be Greenspan and the Governors of the Fed system who bear the blame. Theoretically they act independently.
daleyrocks (5d22c0) — 2/10/2009 @ 7:49 am“He just cut taxes, so his base could afford more Cayman Island bank accounts.”
timb – How many middle class people do you know with Cayman Island accounts?
daleyrocks (5d22c0) — 2/10/2009 @ 7:51 amAre you just so offended he sounds careful and measured like an NPR host!
Well, they both lie through their teeth, now that you mention it.
Dmac (49b16c) — 2/10/2009 @ 8:00 am…”what this election was all about …”
You know, given the profound unpopularity of Bush, the press going all tingly legged, the poor economy, the unpopularity of the war, gas prices, the campaign spending gap, and the fact that no body truly liked the Republican candidate, this election was not really a big win for the Dems. But the Office of the Former President Elect is going all Nixonian based on a what is, in reality, a rather mediocre performance – given the advantages they had.
quasimodo (edc74e) — 2/10/2009 @ 8:01 amIndeed, independence is supposed to be the central character of the Federal Reserve. To keep it out the politicians hands.
quasimodo (edc74e) — 2/10/2009 @ 8:03 amDaleyrocks,
Bradley J. Fikes, C. O.R., who wants DRJ back! (0ea407) — 2/10/2009 @ 8:06 amYes, Greenspan and the Fed certainly deserve blame. As you noted, “theoretically,” they act independently. But in practice, as we all know, the Fed is largely a political body that gives great deference to what the President and Congress want.
He is still a “good” man though even if he tells the entire country bald faced lies. Yes indeed 🙂
Mr. Pink (eae12c) — 2/10/2009 @ 8:07 amThey have GOT TO CHANGE the filter in the White House Water system….
EricPWJohnson (8e86b5) — 2/10/2009 @ 8:32 amPatterico types out with a straight face: Obama sez concerning $800 Billion in debt “And that’s part of what the election in November was all about.”
FAIL, Pat. LIE. DISTORTION. HORSESHIT.
For an attorney your lack of reading comprehension is troubling (most prosecutors are so handicapped, I find).
The election was about changing the failed policies of the last eight years. Full stop.
Peter (e70d1c) — 2/10/2009 @ 8:46 amThis part of the stimulus bill should make it easier for Obama to track and leak medical dirt on Rush Limbaugh.
Wesson (3ab0b8) — 2/10/2009 @ 9:05 amYour medical treatments will be tracked electronically by a federal system. Having electronic medical records at your fingertips, easily transferred to a hospital, is beneficial. It will help avoid duplicate tests and errors. But the bill goes further. One new bureaucracy, the National Coordinator of Health Information Technology, will monitor treatments to make sure your doctor is doing what the federal government deems appropriate and cost effective.
Bloomberg: Medical changes in Stimulus
http://www.bloomberg.com/apps/news?pid=20601039&refer=columnist_mccaughey&sid=aLzfDxfbwhzs
voiceofreason2 (10af7e) — 2/10/2009 @ 9:07 amCourtesy of Drudge.
Welcome to Tricare for the rest of the country..:(
I like when Barry knits his brow. He looks so…presidential! In sort of a dreamy way.
Patricia (89cb84) — 2/10/2009 @ 9:08 amFunny thing is, if you look at it from the right angle and squint just right, the bailout *was* what the election was (partly) about. Or rather, the debt crisis. McCain was getting pretty close in the polls around late September or so (if I recall correcly), basically reaching a tie with Obama at one point. Then the housing bubble burst, Lehman Brothers went belly-up, and Obama’s campaign speeches about the economy sounded much better to voters than McCain’s. Cue McCain’s drop in the polls, and Obama’s solid 53%-47% victory on Election Day. (Yes, the electoral college votes are what actually counts, but the popular-vote figure is easier for me to remember).
Of course, many of those same voters are expressing their opinions in current polls that they don’t like the trillion-dollar “bailout” bill (I believe I saw a figure of 57%-41% opposition among independents in one recent poll). But Obama’s “I won” line, while very arrogant-sounding, is a pithy summary of a fundamental truth: elections have consequences. We (collectively) vote for a President and a Congress, we’d better be prepared to live with the laws they pass.
BTW, when I was trying to remember the Lehman Brothers name, the first name that came to my mind was Leman-Russ. Wonder what that says about me… 🙂
Robin Munn (4811b5) — 2/10/2009 @ 9:19 amWhy do I, as a retired baby boomer, have the uneasy feeling that I am going to be denied health care by a faceless committee somwhere, my personal physician will be required to ask “Mother, may I…” when it comes to making decisions, and the military will be armed with realistic looking paint-ball guns to combat terrorism.
My quality of life may end up on a conveyor belt into the gaping maw of the Soylent Green machine if I am unfortunate enough to require a medical procedure that will extend my life beyond my actuarial death date.
The new mantra for baby boomers from the “Committee For Proper Medical Prescriptives” will be for me to “Take one for the team” as they close the door to my soundproof cubicle so that I may die alone in noisy solitude.
Now we know where the payback is coming for the stimulapalooza!
vet66 (9d1bb3) — 2/10/2009 @ 9:20 amYou know, I’m just curious. What do folks on the Right think McCain would be doing about now, three weeks into his presidency?
Peter (e70d1c) — 2/10/2009 @ 9:26 amMcCain would be doing the following:
– sending out messages via our contacts in Tehran to tell the Mullahs that if they launch one more rocket test, we tell the Israelis to begin bombing immediately;
– calling Putin (who’s the real leader of Russia) and mentioning that if they interfere in our air base again next to Afghanistan, we’ll station NATO troops in Georgia immediately;
– going immediately forward with the missile defense system in Europe.
But then again, you probably have no idea what I’m talking about, as does Obama.
Dmac (49b16c) — 2/10/2009 @ 9:48 amPissing us off, but in a different way.
Rob Crawford (04f50f) — 2/10/2009 @ 9:54 amPeter, unable to defend $800 billion in back-loaded spending masquerading as stimulus, is now left with only, “Well, your guy probably couldn’t do any better.”
Steverino (69d941) — 2/10/2009 @ 10:00 amIf he were sleeping, we’d be better off. But I think he’d be doing something similiar only much less porky.
Pablo (99243e) — 2/10/2009 @ 10:05 amI have a feeling McCain would have wrote the bill himself instead of letting Pelosi write it. You know something that would take actual leadership.
Mr. Pink (eae12c) — 2/10/2009 @ 10:11 amhttp://www.marketwatch.com/news/story/US-Stocks-Drop-Amid-New/story.aspx?guid=%7B789D775E%2D5073%2D48DE%2D9CC5%2D6559E967A586%7D
In the mean time, the stock market is reacting sharply to Geithner’s new bank bailout proposal.
Steverino (69d941) — 2/10/2009 @ 10:26 amSteverino: “Well, your guy probably couldn’t do any better.”
You read that into it. Not me. I’m interested in hearing about what McCain might be doing.
If like Dmac, says above, he’d be doing nothing about the economy and creating flashpoints with Putin, Iran and putting a missile defense system in Europe, I fail to see how that addresses the economy. Unless a win fall of military contracts for General Dynamic, Raytheon, Lockheed-Martin and Rockwell is what you folks consider to be an economic solution, in which case I suggest you go climb the nearest tree.
The CBO thingy. Has the CBO done an accounting on what will happen to the economy if nothing is done. How much personal and company wealth is going to disappear. How destructive in $$ amounts would the price of a deflationary spiral be to the well being of millions in this country. How many jobs would be cut, how big a percentage rate would the GDP fall by, and all those homeowners and small businesses and credit card customers having their loans called in from the banks, or their rates taken to the max (32% on credit cards soon. Get your shit in order, now folks, pay them off, take them out of your wallet, better yet cut them up) the ones who’re healthy and pay their bills on time?
I guess the CBO or GAO don’t do that sort of wealth loss projection, or do they, I honestly can’t recall of they do….
Peter (e70d1c) — 2/10/2009 @ 10:30 amIf anyone thinks McCain wouldn’t be superior in matters of national defense, check into your nearest Obama rehab addiction clinic. And read some history while you’re detoxing.
Dead on.
Vermont Neighbor (ab0837) — 2/10/2009 @ 10:39 amWhat do folks on the Right think McCain would be doing about now, three weeks into his presidency?
Emperor7 (1b037c) — 2/10/2009 @ 10:40 amI believe McCain would be sending aides to tell Sarah Palin to stop acting like he’s not in charge. That is in addition to doing nothing.
Steverino: In the mean time, the stock market is reacting sharply to Geithner’s new bank bailout proposal.
This is limited thinking and displays no perspective of the very same inherent systemic dysfunction in the stock market that got us into this mess. It’s no longer an accurate (taken overall.) metric for what is happening to the economy. It can add 500 point tomorrow and it won’t mean squat. The whole thing is more or less broke, as is the banking system and needs to be dismantled, gutted of shit parts and missing parts, cleaned, oiled and put back together again. I guess like a gun, and right now that thing like any fu*ked up gun is liable to take hand with it.
If you must follow the market as an indicator, chose a company that is healthy and sound and see how it’s doing.
Peter (e70d1c) — 2/10/2009 @ 10:40 am“Doing nothing” would be better for us than the Omnibus Corruption Act of 2009.
Rob Crawford (04f50f) — 2/10/2009 @ 10:43 amVN/Dmac: If anyone thinks McCain wouldn’t be superior in matters of national defense, check into your nearest Obama rehab addiction clinic. And read some history while you’re detoxing.
I disagree. That Rx laid out by Dmac sounds like Bush part deux. And we all know how well that worked out for us. The economy is one of the most vital elements of a strong national defense. Obama’s assigned brilliant people to all those flashpoints and issues, yet 3 weeks in and you folks think it’s not working and have to whine like big babies: “McCain would be so much better on national defense…boo hoo booo hooo…WAA..WAAA!”
Okay, I’m leaving now. For real.
I am really, for real no longer wasting time here today….
Peter (e70d1c) — 2/10/2009 @ 10:47 amComment by Rob Crawford — 2/10/2009 @ 10:43 am
Really, Rob. How does “doing nothing” translate to saving the economy, creating jobs, controlling foreclosures and restoring confidence? I want to see how it works. Please take me through it.
Emperor7 (1b037c) — 2/10/2009 @ 10:51 am^ Because the porkulus is a spending bill, heavy on special interest projects. And the benefits are partisan.
Vermont Neighbor (ab0837) — 2/10/2009 @ 10:59 amAlso, I’m leaving because Pat, has decided to censor me today, for telling him he’s wrong to interpret Obama’s words as meaning: The election was about incurring $800 billion dollars of government debt.
As always the freedom of speech thingy on this blog can turn on a very subjective dime. Especially when Obama’s words are parsed for maximum distortion.
Tsk, tsk.
Peter (a72029) — 2/10/2009 @ 11:02 amIt doesn’t, oh deliberately dense one. But doing nothing would be FAR better than this monstrosity Obama is foisting upon us.
Steverino (69d941) — 2/10/2009 @ 11:03 amPerhaps I’ll send IRS $1.98 My share of the bill that IS NOT Pork!
GM Roper who wants DRJ back on Patterico's Pontifications (85dcd7) — 2/10/2009 @ 11:03 amOr, maybe with inflation $2.15 soon to be $2295.03 due to hyperinflation. Calling Jimmah Cahtuh!!!
GM Roper who wants DRJ back (85dcd7) — 2/10/2009 @ 11:05 amOk Peter, have a good day.
You think Saddam was no threat, but it was HIS refusal to cooperate with the UN that got him in trouble… and his harboring terrorists through the 90s… and later, the food for oil games.
The progress now in Iraq is all over the net. Just google. Barry finally admitted the surge worked — McCain was the only one for it.
Love Obama if you must, and I know you do. But realize his agenda is domestic. He’s got NO international creds.
Vermont Neighbor (ab0837) — 2/10/2009 @ 11:09 amDoing nothing is better than doing the wrong thing.
For example: you have a cold. I prescribe cutting off your arms. Got it?
Your assumption that the “stimulus” bill will “save the economy” and so on is noted, but rejected. Left to itself, the market will sort out all of that. The more the government messes in the economy, the more confusion over what exactly the market should do.
Ask the Congressional Budget Office for its judgment of the “stimulus” bill.
Rob Crawford (04f50f) — 2/10/2009 @ 11:09 amWhy should the government be controlling foreclosures, lovie?
JD (c2765f) — 2/10/2009 @ 11:11 amMy prediction: the answer will be “why shouldn’t they?”
Rob Crawford (04f50f) — 2/10/2009 @ 11:12 amPeter only gone for a day? What, the Thorazine prescription is running out?
steve miller (3381bc) — 2/10/2009 @ 11:17 amObama says his plan will create or save 4 million jobs. When there are only 4 million jobs left in the U.S., will he take credit for saving them?
jwarner (0a2a75) — 2/10/2009 @ 11:18 amSadly, Rob, you are likely correct. Because people had guns to their heads when they were taking out mortgages they could not afford in the long run.
JD (c2765f) — 2/10/2009 @ 11:19 amNot to go too off-topic… but why shouldn’t the government control everything ( ! )
Vermont Neighbor (ab0837) — 2/10/2009 @ 11:19 amYou know, I’m just curious. What do folks on the Right think McCain would be doing about now, three weeks into his presidency?
Comment by Peter
I know he left (darn !) but the question is a good one.
I think he would probably go with the House Republican plan which would increase unemployment benefits to deal with the rising rate, provide some incentives for car and home purchases and cut the payroll tax for either 6 months or a year. The amount of stimulus would still be high, probably $600 billion, but it would all be temporary and would not create a new baseline as the pork does. Also, it would all be out in the economy by summer.
The positive about such a program (I don’t believe he would do nothing) is that it would be short term, very powerful for average folks as the payroll tax (FICA) is capped and would come to an end. The CBO is already predicting recovery by year end. The question now would be will the Obama porkfest stall the recovery the way Roosevelt’s anti-business actions in 1933 and 34 stalled the recovery from the 29 crash.
Mike K (f89cb3) — 2/10/2009 @ 11:26 amComment by Rob Crawford — 2/10/2009 @ 11:09 am
Emperor7 (0c8c2c) — 2/10/2009 @ 11:38 amGoing by your “do nothing” formula, it follows that if I have a cold, I should do nothing about. I should let the cold “sort itself out”. Am I reading you correctly. You have proffered doing nothing as a solution. So if Obama does nothing, the economy will fix itself. Right?
No, you blithering moron. Rob gave you a scenario where doing nothing was better than the alternative.
The answer is to do the right thing. But when the action proposed is wrong, doing nothing is better than doing the wrong thing.
Is that so hard to understand?
Actually, yes, the economy will eventually recover on its own.
Steverino (69d941) — 2/10/2009 @ 11:42 amYup. Colds do sort themselves out. Or, you could cut your head off, which would relieve your symptoms.
Pablo (99243e) — 2/10/2009 @ 11:44 amFunny thing about colds. When I get one, and I take an aspirin or two, it does not cure the cold………. but of course I’m much more productive throughout the duration of the cold.
I can actually work while I’m sick (economy), instead of staying in bed (unemployed) and doing nothing.
Oiram (983921) — 2/10/2009 @ 11:50 amRepublicans warning about deficits??!! ha! ha! ha!. Republicans are the only species of elephant with NO memory…or should I say they hope we have NO Memory… and with good reason.
Here is a truth you can bet on.
Limbaugh speaks for all of them when he said he hopes the economic recovery package fails. A party which once saw itself as dominating the political landscape like the Democrats did after Roosevelt, now sees its only chance for a comeback in more misery and more job loss and more home foreclosures.. Country be damned… flag pins not withstanding.. that is what they want.
Certainly there will be parts of the bill that are not ideal but pointing these areas out is not done for the sake of making a better bill but for the sake of killing it because it is a repudiation of failed Rep/Con/ Bush/ Reagan policies. Voodoo economics, trickle down economics if finally having consequences.
You dont have to be an economist to know that we are in an economic mess and that Republican right extremists have been in charge for eight years. They will do what they can to avoid blame as they have avoiding responsibility for their foolish war in Iraq. They will cry “socialism” ” Marxist” “family values” “class warfare” “pork” and, without so much as a smirk, warn about Democrats deficits.!!!?? They see killing this as a way to worm their way back to power because it just might succeed.
More suffering is what they want so they can returned to power to continue their attacks on middle class, destroy any social programs, give tax breaks to multi-millionaires and smear and slam anyone who disputes their wars of aggression.
So they do what they can to discredit this bill and wish for Obama to fail.
In their minds there is no need for economic policy. Just trust to the free enterprise system to do it all.. and if you don’t let the gays get married you can count on God’s help as well!
Anything different is Un-American, anti capitalist,Marxist, Socialist, envying the rich and Ungodly too boot.
George Mitchell said it best twenty years ago.. “Republicans will tear down the house if necessary in order to rule over the ruins!
Republicans have had their chance and they failed, miserably.
VietnamEraVet (543dfe) — 2/10/2009 @ 11:52 amVermont Neighbor you really dont know what you are talking about.. You refer to the UN BUT the UN and the International Atomic Energy Commission BOTH dispute your version of things. But dont let that inconvenient fact get in the way or your determination to twist the facts.
VietnamEraVet (543dfe) — 2/10/2009 @ 11:57 amQuote the UN when it supports your preconceived notions and denounce them when they dont.. Quite a game you play!!
Did I read this correctly?
Peter pokes fun at people for not liking when things don’t go their way…and then angrily leaves because…things don’t go his way?
Projection, thy name is….?
Eric Blair (912fb6) — 2/10/2009 @ 12:04 pmLimbaugh speaks for all of them when he said he hopes the economic recovery package fails.
That’s a lie. He said that if Obama wants to introduce socialism, he hopes he fails.
Oh well, nothing new from you.
Mike K (8df289) — 2/10/2009 @ 12:18 pmI don’t think it is about facts, Dr. K. I keep finding people who tell me what Limbaugh “thinks” or “says” who never actually heard what he said or read the transcript.
It takes us back to Alinsky.
Hope and Change!
Eric Blair (912fb6) — 2/10/2009 @ 12:19 pmLooks like Thorazine is in short supply all around, judging by the people posting according to the voices in their heads.
steve miller (3381bc) — 2/10/2009 @ 12:21 pmVEV,
You might want to ask the CBO why they, too, want Obama to fail. I think you’d be laughed out of the room, however. You shouldn’t assume that anyone who disagrees with this joke of a spending bill is doing so out of partisanship.
What will happen when people wake up to the fact that Dem’s have been in control of congress for the last two-plus years? Might not portend so well for the mid-terms.
How can you (channeling Obama at the presser) blame Republicans for deficit spending which contributed to the calamity and in the same breath propose tripling the deficit to get us out?
Irresponsible spending has been a bipartisan endeavor, at least up until now. When one side balks at going over the cliff, maybe they have a point. And if they don’t it will become clear in short order. Republican support is not necessary to pass this generational theft so there’s no reason to get upset when it isn’t forthcoming.
Chris (b886a5) — 2/10/2009 @ 12:21 pmHere’s something else that our Fearless Leader promised:
Let’s see, he’s going to cut tax rates to a total take of less than 18.2%/GDP but lower wasteful spending (our government was spending 22% of GDP before the 2008 and 2009 bailout bills) so that the deficit comes down.
Can we count this as yet another broken promise, just three weeks into his first — and hopefully last — term?
The very disappointed Dana (3e4784) — 2/10/2009 @ 12:23 pm“Obama says his plan will create or save 4 million jobs”
And GM announced that under the terms of their agreement with the Government, they are laying off 10,000 white collar workers world wide. Great start.
quasimodo (edc74e) — 2/10/2009 @ 12:24 pmThe beauty of claiming this will “save 4 million jobs” is that it is unverifiable. As long as the total employment in the US doesn’t drop below 4 million, The Big O can claim he met the objective – “See, I saved those last 4 million jobs.”
I want this guy to fail.
steve miller (3381bc) — 2/10/2009 @ 12:27 pmBut wait! There’s more! Stay tuned for Bank bailout 2!
Early returns say that EVERYBODY hates this next plan
http://www.huffingtonpost.com/2009/02/10/administration-officials_n_165551.html.
Everybody except big insolvent banks.
EdWood (0bd853) — 2/10/2009 @ 12:31 pmMaybe we will see some “real” bipartisanship in Congress after all!
Also, Im leaving because Pat, has decided to censor me today, for telling him hes wrong to interpret Obamas words as meaning: The election was about incurring $800 billion dollars of government debt.
As always the freedom of speech thingy on this blog can turn on a very subjective dime. Especially when Obamas words are parsed for maximum distortion.
I have no idea what you’re talking about, Peter.
I can only assume that you have some comment sitting in a filter — and rather than asking me about it, you’re choosing to assume I moderated it somehow.
Well, I didn’t. I can’t check the filter right now — as a consequence of the WordPressMu software that was installed to accomodate the Jury site, I can’t get into the admin from my phone any more — so I’ll check when I get home.
Ask the regular conservative commenters here how often their comments get stuck in a filter.
Patterico (75352e) — 2/10/2009 @ 12:34 pmLet’s hope his plan saves 100 million jobs since that is about the number the country has. That estimate is just as silly as his estimate of how many he will “save.” I don’t think this is a good start.
Mike K (f89cb3) — 2/10/2009 @ 12:36 pmAnyone care for a little history lesson? Courtesy of the 5 Minute Forecast today:
“We have tried spending money,” begins our mystery politician today. “We are spending more than we have ever spent before and it does not work. I say after eight years of this administration, we have just as much unemployment as when we started…
“And an enormous debt to boot!”
The mystery man? Henry Morgenthau Jr., Treasury secretary to then-President Franklin Delano Roosevelt.
Morgenthau uttered these words in May 1939 before the House Ways and Means Committee. Despite being a chief architect of the New Deal, Morgenthau came to the House to repent… six years after the New Deal’s inception, the unemployment rate had climbed back to 20%. The New Deal failed.
I’d much prefer to see the majority of congress people with history degrees rather than legal ones. Though with both Bernanke and Greenspan supposedly experts on the Great Depression [we’ve had worse btw] perhaps that is only misplaced hope.
allan (784964) — 2/10/2009 @ 12:39 pmVeV is a blithering moron. Someone ran out of their scripts.
JD (c2765f) — 2/10/2009 @ 12:48 pmThe financial markets seem to think that Obama’s “plans” are crap.
SPQR (72771e) — 2/10/2009 @ 12:52 pm#56 wrote: George Mitchell said it best twenty years ago.. “Republicans will tear down the house if necessary in order to rule over the ruins!
Obama is off to a good start tearing down Wall Street, savings, retirement plans and banks.
Perfect Sense (0922fa) — 2/10/2009 @ 1:01 pmWho said Affirmative Action could be bad?
Oh, it happens to me all the time. In fact, a week or so ago, I couldn’t post anything under my name until you went in and fixed it. But when it happens to Peter, it’s because you’re evil and afraid of the awesome power of his awesomeness. If you weren’t such a chicken, Pete would be flashing his ass all over the place, uninhibited by the spam filter! Or, something like that.
Pablo (99243e) — 2/10/2009 @ 1:21 pmI see where VV is back from his unfortunate flashbacks.
McCain would be so much better on national defense…boo hoo booo hooo…WAA..WAAA!”
Wow – that’s telling us, Peter. Consider the issue settled in your favor from now on. Schmuck.
Dmac (49b16c) — 2/10/2009 @ 1:24 pmVeV just snapped. That was a Grade-A rant. Brava.
JD (4342a2) — 2/10/2009 @ 1:35 pmJD – VeV has never been unsnapped. She was in da shit in Connecticut or something. Agent Orange fried brain.
Thanks for your service VeV.
daleyrocks (5d22c0) — 2/10/2009 @ 2:04 pmTimmuh No Tax failed at his first big test today.
1, bad delivery
2, he was asking the market for equity to co-invest with the Gov.t but problem is Investors don’t want to invest with socialists “who demonize you if you are making too much money?”
Looks like Timmuh plan is going to require lots of arm twisting or the private sector.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 2:33 pmarm twisting OF the private sector.
‘Luck Timmuh.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 2:34 pmThe answer is to do the right thing. But when the action proposed is wrong, doing nothing is better than doing the wrong thing.
Is that so hard to understand?
Emperor7 (1b037c) — 2/10/2009 @ 2:38 pmSo we have three options. The stimulus package, do nothing, and a better plan that does not involve spending. Right. Let’s cancel out the first two options. We are left with option three: A better plan that does not include spending. Question: What is this plan? Who knows? What is this “right thing”?
Patterico spelled accommodate without the second m. He never makes mistakes (and I’m not kidding). He’s all about the printed word.
He could call this blog Perfecterico, with his love for words.
Vermont Neighbor (ab0837) — 2/10/2009 @ 2:38 pmEmperor7, another logical fallacy on your part. That of the excluded middle. There is a fourth option, a more limited, targeted stimulus package designed to actually stimulate economic growth rather than reward Democratic constituencies.
SPQR (72771e) — 2/10/2009 @ 2:46 pmObama from the third Presidential debate:
“But there is no doubt that we’ve been living beyond our means and we’re going to have to make some adjustments. Now, what I’ve done throughout this campaign is to propose a net spending cut.”
Obama from the second Presidential debate:
“I want to go line by line through every item in the federal budget and eliminate programs that don’t work and make sure that those that do work, work better and cheaper.”
Obama now:
daleyrocks (5d22c0) — 2/10/2009 @ 2:47 pmI won, bend over and taste my stimulus bitches.
………That of the excluded middle. There is a fourth option, a more limited, targeted stimulus package designed to actually stimulate economic growth rather than reward Democratic constituencies.
Comment by SPQR — 2/10/2009 @ 2:46 pm
(Translation Tax Cuts For The Rich)
Oiram (983921) — 2/10/2009 @ 2:50 pmAre you that daft? There are scads of other plans. The problem is, the MSM/Democrat Party only talk about their plan. It’s the starting point; all other plans are down the bit bucket.
Egads. It’s as if it’s Year One. Except for blaming Bush for the deficit (passed by the majority Democrat Party in Congress). That will go on until The Big O flies away on Marine One to Davos in retirement.
steve miller (3381bc) — 2/10/2009 @ 2:52 pmOiram does not care how many people are unemployed as long as he feels he’s screwing the kulaks.
SPQR (72771e) — 2/10/2009 @ 2:52 pmOiram, do you want the $5.5 billion in for Acorn ?
Vermont Neighbor (ab0837) — 2/10/2009 @ 2:53 pmEveryone deserves “stimulus” except for the people that actually pay taxes.
JD (341fdd) — 2/10/2009 @ 2:54 pmOf course, I was a bad boy in #83 as I made a historical reference that would go right over Oiram’s head … not to mention Emperor7’s et al.
SPQR (72771e) — 2/10/2009 @ 2:57 pmDid Barry get a lump on his head after that little mishap on Marine One? Guess we can’t blame HH, head hoochie…
Vermont Neighbor (ab0837) — 2/10/2009 @ 2:58 pmOur pool boy mario doesn’t need no stinkin’ history.
steve miller (3381bc) — 2/10/2009 @ 3:00 pmDemocrat Representative Walt Minnick has actually proposed an alternative that is aligned with Obama’s campaign promises and phases out as the economy recovers. Sized at only $170 billion, though, the media isn’t giving it much traction and he’s in hiding from Pelosi’s hit squad at the moment.
daleyrocks (5d22c0) — 2/10/2009 @ 3:02 pm#83 Untrue
Oiram (983921) — 2/10/2009 @ 3:03 pm#88 Partisan Steve overlooked the last 8 years solely because we haven’t been hit by terrorists.
Oiram (983921) — 2/10/2009 @ 3:04 pmLovey – Do you want Barcky to nationalize American industry and ration health care to senior citizens?
daleyrocks (5d22c0) — 2/10/2009 @ 3:05 pmYou’re not a very good mind reader, are you? But you knew that.
Tax cuts for tax payers, I can understand.
Tax cuts for untaxed users, I don’t understand. Call it by its accurate name — a giveaway.
If you want to make the argument that you hate rich people and you think they should lose control of your money, then make the argument. But if you want to make the argument that tax cuts to the “rich” somehow don’t rebound to the rest of society – feel free to make that unique and factless argument.
steve miller (3381bc) — 2/10/2009 @ 3:07 pm(Translation Tax Cuts For The Rich)
(translation – debunked liberal myth)
daleyrocks (5d22c0) — 2/10/2009 @ 3:09 pmHey guys your all on the assumption that I’m still on board with the current stimulus package.
It’s not enough.
Good job guys, our economy is likely to tank and Obama will get the blame for it. Some liberal ranter above mentioned “Elephant Memory”, that part was true anyways.
I make jokes here on a regular basis about Palin (sorry about that).
Not joking now, next time please pick someone who can create a strong middle class.
That is what you want right?
Actually That is a serious question for you guys.
However we get there, can we all agree that a strong middle class will help the future of our country?
Oiram (983921) — 2/10/2009 @ 3:09 pmBy the way, your guy “won,” as he is so fond of telling the rest of us, so you really can stop thinking it’s all Bushaliburtonoil. Most of us have moved on from that meme and are on the new meme: supporting The Big O is bipartisan; speaking out that he’s wearing no clothes is partisan. Get with the program, clear your cache, and refresh your browser.
steve miller (3381bc) — 2/10/2009 @ 3:09 pm@Oriam: “(Translation Tax Cuts For The Rich)”
Comment by Oiram — 2/10/2009 @ 2:50 pm
How tired that meme really is, and duplicitous too. The fact is that ALL of us got the same cut and a fellow that made $1.98 more than I did got a little tiny bit more. The fellow (or gal) that made $198,000.00 more than me got a lot more money than I did, but he paid a hell of a lot more too (Unless he was a future appointee to the Obama Cabinet and fudged on his taxes). And some folks that didn’t pay any taxes at all got some money too so they made out like a bandit percentage wise. I can only assume that Oiram flunked 6th grade math. But it seems he is in the same league as a lot of Democrats these days.
GM Roper who wants DRJ back (85dcd7) — 2/10/2009 @ 3:10 pmIn theory, we have many options. However, Obama has only presented us with his plan, and Congressional Democrats voted down any Republican alternative.
So, the Democrats have left us with very little to choose from. Given the choice between Obama’s plan and nothing, I think nothing will do less damage to the country.
Steverino (69d941) — 2/10/2009 @ 3:10 pmOiram, what do you personally want taken out of the $8 B ?
Vermont Neighbor (ab0837) — 2/10/2009 @ 3:10 pmBut if you want to make the argument that tax cuts to the “rich” somehow don’t rebound to the rest of society – feel free to make that unique and factless argument.
Comment by steve miller — 2/10/2009 @ 3:07 pm
Give me a break Steve, enormous bonus for C.E.Os of tanking companies is enough for my argument.
Oiram (983921) — 2/10/2009 @ 3:12 pmLet me see if I get you right, pool boy. You come in here throwing Molotov cocktails, and then ask innocently “how can we all work together?”
No thanks. I’d rather have an opponent who’s honest than a supporter that’s dishonest.
steve miller (3381bc) — 2/10/2009 @ 3:13 pmIt might be if it had anything to do with tax policy. But it doesn’t and it isn’t.
Pablo (99243e) — 2/10/2009 @ 3:14 pmWhy is it so difficult for some of us to make comments without name-calling and insults? Makes me think we have a lot of juveniles posing as serious commenters.
Emperor7 (1b037c) — 2/10/2009 @ 3:14 pmLet’s see – now how much do sports figures make a year? More than CEOs? Less? And somehow that’s OK?
A board is free to reward the CEOs that keep them in business. If they reward the CEOs inappropriately (they aren’t worth that), then the boards are stupid and fiscally idiotic.
Don’t like CEO bonuses? Then don’t take one, pool boy.
steve miller (3381bc) — 2/10/2009 @ 3:14 pmName-calling is sometimes a form of affection.
steve miller (3381bc) — 2/10/2009 @ 3:16 pm#97 Did the person who made $198,000 (explain what that means to JD please) use more of what our government has to offer?
If you answer “no”, your beyond help.
Entitlements exist for the rich as well, yet you want them to pay the same percentage everyone does.
Oiram (983921) — 2/10/2009 @ 3:17 pmWhy not make them pay what everyone else pays? What’s the use of being rich if you are forced to pay more for everything?
You think rich people are rich because they’re crooked? Or are they rich because they provide value that others pay for?
Rich people, if told to work just as hard but get paid less by government fiat, will discover they can work far less – why work harder when the harder work is taxed at a higher rate.
I know the whole marketplace/capitalism thing is hard to understand if you’re making a livelihood cleaning pools, but Adam Smith trumphs Karl Marx every time.
steve miller (3381bc) — 2/10/2009 @ 3:19 pmA board is free to reward the CEOs that keep them in business. If they reward the CEOs inappropriately (they aren’t worth that), then the boards are stupid and fiscally idiotic.
Don’t like CEO bonuses? Then don’t take one, pool boy.
Comment by steve miller — 2/10/2009 @ 3:14 pm
Yet they get bailouts under TARP
As usual, privatize the gains…….. socialize the losses. 🙁
Oiram (983921) — 2/10/2009 @ 3:20 pmPretty rich (pun intended) to talk about the rich paying taxes coming from the party that elevates tax cheats to Treasury Secretary.
Why, I’m about to stop listening to these people – they’ve had 8 years to fix their taxes, and they failed. The American people want change.
steve miller (3381bc) — 2/10/2009 @ 3:21 pm#107 I have nothing against rich people Steve.
I want to be one someday 🙂
But I would like to know that I’ve paid a fair amount of taxes on my way there.
Oiram (983921) — 2/10/2009 @ 3:22 pmTARP was initiated and passed by the Democrat Party which controlled Congress. The largess is due to your side of the aisle.
The latest pile o’ lard is due to your side of the aisle as well. Nice to keep dredging up history when it is the Democrat Party that has foisted these trillion dollar spending bills.
steve miller (3381bc) — 2/10/2009 @ 3:24 pm#109 We could finally agree Steve. Obama screwed up royally on those 3 cabinet choices.
Oiram (983921) — 2/10/2009 @ 3:25 pmExplain how someone that makes $198,000 uses more government services than someone that makes $80,000, or $40,000, or $20,000. Simply asserting that does not make it true.
Steve – Did you miss the fact that Mario thinks that the “stimulus” hooha does not go far enough?
Mario – CEO bonuses are taxed, heavily. I would love to get all of my bonus, but there is quite a hefty chunk taken out. But that was really just a distraction on your part.
JD (341fdd) — 2/10/2009 @ 3:25 pmNothing – absolutely nothing – is stopping you from paying your fair share right now.
steve miller (3381bc) — 2/10/2009 @ 3:27 pm“Using government services” is a useless canard. I’m taxed on my cell phone use (a use which affects my city precisely 0.0%) because (as the city admin office told me) “you live in the city and we can tax you.” What government service am I using that my cell phone is taxed? Well, unless you count the fact that perhaps the cell phone tower might fall and hit a power line and cause a fire and result in FEMA running in to handle things like it’s doing in Kentucky right now. (Thanks, Big O! You certainly showed us how to do Katrina right!)
But government services I’m using? Feh. It’s not that I use the services – it’s that they can just take the money. Because, after all, I’m “rich.” Or something.
One thing I know, I’m patriotic because I pay my taxes – just ask Slo-Mo Joe. And, I’m not a member of the Democrat Party, either — also because I pay my taxes.
steve miller (3381bc) — 2/10/2009 @ 3:31 pmI like pie.
daleyrocks (5d22c0) — 2/10/2009 @ 3:33 pmLook I don’t feel like being fodder for you all today.
I would just like my simple question answered.
I try to take into consideration every point I read here, even if I think it’s wrong.
But I might have to reconsider, if we all can’t agree on a strong middle class.
Oiram (983921) — 2/10/2009 @ 3:34 pmI am cool with a strong middle class, so long as it is not done by punishing those that pay taxes.
What income range do you use to define the middle class, mario? You see, depending on the topic and the audience, Leftists do not like to define this term.
JD (341fdd) — 2/10/2009 @ 3:39 pmPeter, amongst others, asked:
As much as I hate to admit it, Peter has asked the right question, at least in a hypothetical sense. Senator McCain is a long-time Washington insider, and he is probably just as eaten up with the notion that the federal government, when it sees a problem, must “do something” about it. The notion that doing nothing might be the best idea probably would never occur to him, and if it did, if he got up and said, “Look, people, the recession will end in due course, as they all do,” he’d be politically excoriated. And if the recession was still going on, or even perceived to be continuing, at the beginning of 2010, it would be the Republicans chiming in for him to “do something,” because they’d all be afraid of losing their seats.
Under a McCain Administration, the details might be different, but he’d probably pursue the same idiotic general strategy.
The annoyed Dana (556f76) — 2/10/2009 @ 3:41 pm#118 Your “Cool” with a strong middle class?
Shouldn’t it be the corner stone to our economy JD?
As for “Leftists” definitions, yeah your absolutely right about that.
But make no mistake about it both sides have clever ideas of what it should be.
Of course one person’s middle class in Tulsa is another person’s poverty in New York City.
Oiram (983921) — 2/10/2009 @ 3:48 pmEmperor7 wrote:
Actually, yes, if you should catch a cold, you will have caught an annoying but still non-life-threatening disease. As long as you do what you should normally be doing — eating decent food and not smoking pot or snorting coke or patronizing gay bathhouses — you will get over it.
So it is with the economy. Our politicians like to claim that “they” created seven million jobs (when the economy ios going good), but the politicians don’t create jobs at all; private enterprise creates jobs. The politicians simply want to take credit for it.
We have recessions because the economy has to adjust itself occasionally. During good times, there is an aggregate tendency to push the good times too far, and corrections are needed. Those corrections hurt, and politicians see a demand for action when people are hurting. Sometimes, helping them is the wrong thing to do.
The annoyed Dana (556f76) — 2/10/2009 @ 3:49 pmshort answer: I’m here to change the conversation to what I want to talk about, and when the argument gets inconvenient, I leave.
steve miller (3381bc) — 2/10/2009 @ 3:50 pmI agree, Dana. McCain is a staist, whose natural instincts lean towards government intervention. His might have less pork, and payoffs to political interest groups, but I have no doubt that he would have pissed me off too.
JD (341fdd) — 2/10/2009 @ 3:50 pm#118
Where I live, $100,000 would be about right (Husband and Wife only).
Oiram (983921) — 2/10/2009 @ 3:50 pm#121 Dana, I don’t know about you but a couple aspirin taken while I have a cold sure makes me more productive.
It certainly wont cure the cold, but at least I remain productive. *hint* *hint*
Oiram (983921) — 2/10/2009 @ 3:54 pmOur esteemed host wrote:
Occasionally, though there have been some multi-link comments I expected to go into the moderation queue which didn’t.
However, WordPress can be set up to deliver you a notification that your comment is being held in moderation, rather than disappeared into the ether; this site doesn’t seem to utilize that function.
The blogger Dana (556f76) — 2/10/2009 @ 3:54 pmIs that the top or the bottom of your middle class? Where would you adjust that for families with children?
JD (341fdd) — 2/10/2009 @ 3:56 pm#126 I agree with Peter on many issues, but I know Patterico would not moderate unless absolutely valid.
I don’t think Peter was moderated, and should reconsider his accusations.
Oiram (983921) — 2/10/2009 @ 3:59 pmMirrored mariO wrote:
Despite being the husband of a registered nurse, I almost never use medication for colds. Then again, I almost never get colds. Among my naturally superior Republican abilities is a superior constitution and immune system, and I just don’t get sick. The same was true with my mother (she died not due to illness but due to tar from cigarettes coating the inside of her lungs) and my sisters, and one of my daughters.
OK, OK, I realize that there might be some luck involved in getting good genes, as well as being a Republican! 🙂
The very lucky Dana (556f76) — 2/10/2009 @ 4:02 pm#127 Yeah, I guess it would be the bottom JD.
But again that is where I live.
Oiram (983921) — 2/10/2009 @ 4:02 pmThere is no luck in being Republican. It simply takes the ability to look at the world using facts and not hope and change.
steve miller (3381bc) — 2/10/2009 @ 4:03 pmA cold puts mario in bed? Tough guy.
JD (341fdd) — 2/10/2009 @ 4:08 pm#129 You are a good Republican Dana 🙂
Wish everyone could be as healthy as you!
But I do know that most people function better with passive medication than without.
I would rather my cab driver be fighting his cold with non drowsy medication than without.
Without medication, he may need to be home and unproductive.
Oiram (983921) — 2/10/2009 @ 4:09 pmIn several comments asking for a definition of middle class, in income terms, mariO suggested:
I don’t know where you live, but in tax year 2006, an adjusted gross income of $108,904 put you in the top 10% of all income tax filers.
Now, that’s somewhat misleading, because it includes joint returns with an AGI of $108,904 as well as individual filers at that level. But, on average, it would seem that $100,000 would be at the upper end of the middle class nationwide.
The dividing line that sets the median is just $31,987.
So, what actually defines “middle class?” I don’t think that most people would define it by the middle of the income range, from 25% to 75% of average AGI, because that’s going to include a lot of poor people.
In the United States, “middle class” seems to be more of a social than an economic construct.
The economist Dana (556f76) — 2/10/2009 @ 4:13 pmThere’s an interesting double standard inherent in the Ayn Rand for Dummies worldview:
“Rich people, if told to work just as hard but get paid less by government fiat, will discover they can work far less – why work harder when the harder work is taxed at a higher rate.”
So rich people, according to this, are de-motivated by the prospect of getting less out of the government, all in.
But the same people will tell you exactly the opposite about poor people. In their view, poor people will work EVEN HARDER when faced with the prospect of getting less out of the government, all in.
There you have it: rich people, according to this fable, operate under an opposite set of incentives from poor people. Different, indeed.
I don’t believe for a nanosecond that higher taxes will discourage rich people from working. It will, however, affect their investment and risk-taking behavior. When taxes rise, they will more aggressively seek investments that shield them from taxes — along with other “shelters.” And that can have unintended, counterproductive consequences for overall government revenue and economic growth in general.
Anyone who’s known enough rich people would also know that they’re compelled to produce and, most often, far better positioned to do so than poor people. They will not react to tax increases by simply taking more time off. This kind of “rational choice” economic analysis just doesn’t hold up under scrutiny for the obvious reason that humans are not entirely rational. We work for more than money, and the rich even more so.
Meanwhile, let’s remember the first 18 months of the Reagan administration. 11 percent unemployment!
11 percent unemployment!!!
Can you imagine if unemployment doubled under Obama?
Maybe it will.
Then the business cycle turns and we get a recovery and the press starts talking about an “economic miracle” just like they did for Reagan, right? Remember “Reaganomics?” and how its magic fist supposedly save America from recession?
But economists now know that the Reagan recovery was brought by massive increases in government spending, simultaneous with tax cuts. A double whammy of fiscal steroids.
But newspapers, being focused always on the present and disdainful of both the past and future, painted the Reagan economy as some kind of “miracle.”
And if you all are really so convinced that the press is in the tank for Obama, what in the world makes you think this same cycle won’t benefit him?
Hax Vobiscum (edacf7) — 2/10/2009 @ 4:13 pmNo, people are demotivated by devaluing their work. The government ought not be part of the equation.
Apparently, that’s Ayn Rand for the Illiterate you’ve been reading.
Pablo (99243e) — 2/10/2009 @ 4:16 pmMario wrote:
You might call me hard-nosed for this attitude, but I don’t think a cold ought to keep you at home in bed. A headache and congestion should not be debilitating. Man up!
The hard-assed Dana (556f76) — 2/10/2009 @ 4:16 pmthe Hack is back?
SPQR (72771e) — 2/10/2009 @ 4:18 pmI don’t think I can read that much at a time and stay awake. I’m pretty proud of myself I was able to list to The Big O! last night on the radio without driving into a bridge abutment as I slowly…drifted…off…to sleep by the meandering responses and riffs (I can’t dignify them as answers) to the questions spoon-fed in advance to the MSM.
steve miller (3381bc) — 2/10/2009 @ 4:20 pmAh. Faith-based economics. “I don’t believe for a minute.”
Well, yeah. In a non-fact-based worldview, you have your faith.
steve miller (3381bc) — 2/10/2009 @ 4:22 pm#132 No JD, a cold does not put me in bed. What helps, not cures is an asprin or two though.
Perhaps nothing will cure our economy’s ills, but there are certainly ways to cope with it, and still keep us productive until the cycle ends.
Or do you just want the “Tough guys” to survive?
Are bread and soup lines o.k. with you JD?
Oiram (983921) — 2/10/2009 @ 4:22 pm#137 I could “Man Up” Dana.
But we can’t shoot the people who can’t man up.
Oiram (983921) — 2/10/2009 @ 4:26 pmFixing the problem requires that you first identify the problem.
Have we done that yet? Because it sure seems like we haven’t.
If the problem is that ACORN is underfunded and that doctors need to start working for the state – well, yeah, this latest porkulus package is just the ticket.
But maybe we really haven’t identified the problem yet. We just threw away a few hundred billion last fall and winter, and that didn’t help. (Thank you, Democrat Congress!)
So spending $1.4 trillion on pork might not work either. Especially if the “shovel-ready” projects get stalled by EIRs. The money will evaporate, and then what do we do next? Print more money, President Mugabe?
steve miller (3381bc) — 2/10/2009 @ 4:26 pmMr Vobiscum wrote something with which I can mostly agree:
I absolutely agree that high producers will continue to be high producers even if their compensation is reduced, because people who are high producers are that way out of habit and work ethic.
But the part you missed, primarily with your comment that the rich are “most often, far better positioned” than the poor to be top producers, is the also true reverse: poor producers usually remain poor producers even when their compensation rises.
I’ve seen company after company put in place incentive programs to try to get people to work harder, with more money as the reward, and the result was the same invariably: the people who were already the hardest workers reached the incentives, because they worked according to their normal pattern, while the people who were poorer producers remained poor producers, and never exerted themselves harder to try and attain the incentives.
If you doubled my salary, I would not change: I already work as hard and as efficiently as I am capable. If you cut my salary, I still wouldn’t change — other than looking for a different job — because I really only know one way to work.
The hard-working Dana (556f76) — 2/10/2009 @ 4:27 pm“The government ought not be part of the equation.”
Then we’d be having a whole different discussion, wouldn’t we?
Anarchists are the weirdest kind of utopians in that denial is their defining aspect.
Hax Vobiscum (edacf7) — 2/10/2009 @ 4:29 pm“It will, however, affect their investment and risk-taking behavior. When taxes rise, they will more aggressively seek investments that shield them from taxes”
Hax – Alternatively, more highly compensated people seek to take a larger portion of their pay in forms designed to shield them from taxes or to defer tax liabilities to future years. Witness the haggling over the compensation caps related to TARP, where forms of stock based compensation seem OK with the government. This goes back to the discussion of the Bush tax cuts and math that you dodged the other day after your incorrect assertions.
daleyrocks (5d22c0) — 2/10/2009 @ 4:29 pmAsk the regular conservative commenters here how often their comments get stuck in a filter.
It’s even happened to a regular Libertarian commenter.
Brother Bradley J. Fikes, C.O.R., who implores DRJ to remain at Patterico! (b2bf3e) — 2/10/2009 @ 4:31 pmI say we initiate a program of from each according to his ability, and to each according to his need. I’m pretty sure it will work.
steve miller (3381bc) — 2/10/2009 @ 4:33 pm#134 Dana however we define it, and wherever we live. A house, two cars, and enough room for children without piles of un payable debt would be nice.
The income needed for that has so many variables, but if it were true for say 80% of the country, where above that middle class represented 10% and below that middle class represented 10%, wouldn’t we at least be approaching utopia?
Oiram (983921) — 2/10/2009 @ 4:33 pmAnarchy has nothing to do with it.
Pablo (99243e) — 2/10/2009 @ 4:33 pmOiram wrote:
Alas! You’re right about that. But we don’t need to reward them, either. I would organize society on the principle that if you don’t work, you don’t eat.
The brutally-honest Dana (556f76) — 2/10/2009 @ 4:35 pmAnd Pablo chimes in with a demonstration of that denial, right on time.
Thanks!
Hax Vobiscum (edacf7) — 2/10/2009 @ 4:35 pmI’m not sure – are Peter and Hack ever in this room at the same time? I detect similarities of dishonesty.
steve miller (3381bc) — 2/10/2009 @ 4:36 pmOiram comes to the crux of our disagreement:
Depends on how you attained those numbers. If all of the 80% in the middle class were middle class because they worked for it, then yes, ‘twould approach utopia.
But if a significant part of that 80% attained that income level by shirking work and leeching off those who did, then no, it would not be approaching utopia.
The ant-socialist Dana (556f76) — 2/10/2009 @ 4:39 pmant-socialist? Is that some kind of egg-corn?
steve miller (3381bc) — 2/10/2009 @ 4:41 pmWhy?
I bet the CEO that takes home a massive bonus is less of a burden on the government than a semi-literate high school dropout with a criminal record.
Rob Crawford (b5d1c2) — 2/10/2009 @ 4:42 pmHow will borrowing over $1 trillion and funneling it to Democrat partisans help keep the economy productive?
How about a 15-month suspension of payroll taxes, both employee-paid and employer-paid? The dollar amount is the same, the stimulus would be immediate, and there’d be no political shenanigans in directing the spending.
Rob Crawford (b5d1c2) — 2/10/2009 @ 4:48 pmOn Dana’s point:
Nor should we forget the cultural component.
Japanese CEOs make a fraction of what their American counterparts do, yet anyone who would think they produce a fraction of what American CEOs do is hallucinating.
I’d go straight down the line with that, from assembly line workers to middle managers and, certainly, your typical postal worker. Taxes have nothing whatsoever to do with that. The burdens are similar to what you have in the U.S., though one notable and crucial difference is that the Japanese somehow manage to provide universal healthcare via that level of taxation. (Actually, the latter is no mystery, but another discussion.)
Japanese people work harder out of a sense of obligation and because laziness or shirking is considered shameful, by consensus, whereas in the U.S. shirking is too often considered the clever way and a path to management.
At the same time, Japanese workers tend to be far less productive than Americans. Remember, their commitment to hard work is cultural and stems from a sense of obligation, not rewards. That means results are less important than effort.
This means you can get away with sitting at your desk all day and never doing anything other than answering the phone in magnificent obsequiousness and filling out the forms exactly as you were instructed to do, as long as you never, ever leave the office before your boss, take a long lunch, or arrive late.
Work and motivation is a fraught business. Ayn Rand had hold of about 25 percent of the stone-cold truth and, mistaking passion for evidence, played it like it was the whole truth and nothing but. That’s a lot of spinning.
How much tax is fair?
We need to be careful not to answer the moral question with practical imperatives or vice versa.
Hax Vobiscum (edacf7) — 2/10/2009 @ 4:51 pmIf you’re referring to my denial that lack of government involvement in setting compensation for privately performed labor is anarchy, then you’re exactly right. My, you’re a clever boy, Hacks.
Pablo (99243e) — 2/10/2009 @ 4:52 pmI don’t believe for a nanosecond that higher taxes will discourage rich people from working. It will, however, affect their investment and risk-taking behavior. When taxes rise, they will more aggressively seek investments that shield them from taxes — along with other “shelters.” And that can have unintended, counterproductive consequences for overall government revenue and economic growth in general.
There is a grain of truth here but there are plenty of examples of rich people, and even less rich people, working less when taxes are higher. One simple example known to me personally is Swedish doctors. Back in the 70s, Sweden had a confiscatory tax rate above an arbitrary income level, not that high a level either. The result was that Swedish doctors, especially the senior ones who were in higher income brackets, simply took off after October and spent the last three months of the year in the Mediterranean. Nobody could find a senior doctor after October.
A second example also involves Sweden. It was finally reported in the New England Journal about 1975. It was called the Seven Crowns Reform although the articles are too old to have abstracts posted.
The short version is that the government paid seven crowns per visit for doctors to see patients in the outpatient clinics whereas they were paid a salary for hospital work. Eventually, they figured out that all the professors were working in the clinic and all the junior trainees were doing the big surgery. They had to rework the payment scheme to get the professors back doing surgery.
Anyone who’s known enough rich people would also know that they’re compelled to produce and, most often, far better positioned to do so than poor people. They will not react to tax increases by simply taking more time off. This kind of “rational choice” economic analysis just doesn’t hold up under scrutiny for the obvious reason that humans are not entirely rational. We work for more than money, and the rich even more so.
See above. We need a better class of trolls here. I have a number of other examples including the catastrophic “luxury tax” on yachts and airplanes in the 1980s. It lost about 300,000 jobs in a year. Ironically, George MItchell who was majority leader and pushed the bill, saw his own state of Maine get killed by the tax.
These people are stupid. We are seeing stupidity right now with Geithner and the stimulus plan which is tanking the market.
Mike K (2cf494) — 2/10/2009 @ 4:52 pmI believe it’s more a symptom of their peculiar politics.
Rob Crawford (b5d1c2) — 2/10/2009 @ 4:53 pmI like the idea of the tax holiday – but that will never work, because it gives people freedom. The Big O! is all about getting us to love Big Brother who provides our daily needs.
steve miller (3381bc) — 2/10/2009 @ 4:54 pmReally? You don’t work in the US, do you?
Rob Crawford (b5d1c2) — 2/10/2009 @ 4:54 pmI’d really love to hear the supports of the “stimulus” bill explain why it’s preferable to a tax holiday.
Rob Crawford (b5d1c2) — 2/10/2009 @ 4:57 pmJapanese people work harder out of a sense of obligation and because laziness or shirking is considered shameful, by consensus, whereas in the U.S. shirking is too often considered the clever way and a path to management.
More economic illiteracy. Japanese executives have all sorts of off-the-books perks that don’t show up as salary. US CEOs are very highly paid because it is so difficult to manage these large corporations. The trouble is that only about 20% of CEOs are worth their salaries but the problem is identifying which ones are worth their salary. Here is an interesting piece about Steve Jobs, for example. That site is excellent for insight into Silicone Valley management.
This kid just doesn’t know anything about economics. This is just late night dorm bullshit.
Mike K (2cf494) — 2/10/2009 @ 4:58 pmThe Big O! wants us to be in the place where we get our paycheck from the government, and we’re grateful for it.
I think of the USPS and UPS. Similar services, one run by the government, and one not. Good people in both, but one is struggling under the dead hand of government, and one is struggling in the lively competitive marketplace.
We want UPS service but USPS prices and protection. We’ll get USPS service and extraordinarily high prices (even more than UPS, of course).
Want government control of the banks and salaries? Watch the exodus of people who can earn far more than $500,000, replaced by people who think $500,000 is a lot of money – but are vastly incapable of really earning that amount.
steve miller (3381bc) — 2/10/2009 @ 5:00 pmYou mean like recipients who live on Section 8 but have illegal home businesses AND get free healthcare? Or how about the woman who popped out 8 babies for a total of 14 kids. I hate that kind of con job.
Vermont Neighbor (ab0837) — 2/10/2009 @ 5:01 pmRob, I can’t answer you, of course, because I don’t support it on principle or on the facts.
I, too, would love to hear from a true supporter why it’s good to go into debt servicing the government needs versus simply giving the money to the taxpayers to spend as they want.
I mean, a true supporter. Not a true believer. I have had enough of faith-based economics from The Big O! and his team.
steve miller (3381bc) — 2/10/2009 @ 5:02 pm…to the questions spoon-fed in advance to the MSM.
Not only that, but teh Lightworker cut off questioning after a grand total of…fourteen questions. Quite a profile in courage, no?
Dmac (49b16c) — 2/10/2009 @ 5:02 pmBusinesses that promote people into management who are clearly incapable of the job have a word to describe them: bankrupt. The world is too competitive to let shirkers run things. There are a lot of nimble people in India and China who are not shirking and are ready to take over economically.
But lazy thinking – that seems to be what passes for success in the poolside set.
steve miller (3381bc) — 2/10/2009 @ 5:04 pmDoes the Japanese Constitution call for universal healthcare? I am sure that multi-trillion dollar social programs are much easier to fit into a budget when you can rely on the US to aid and assist in your national security.
JD (341fdd) — 2/10/2009 @ 5:04 pmI have a number of other examples including the catastrophic “luxury tax” on yachts and airplanes in the 1980s.
Why do I get the feeling that Hacks has no idea what you’re talking about, and also has no knowledge of what the term “regressive taxation” means? Instead he quotes Ayn Rand, that noted expert on economic theories. Brilliant.
Dmac (49b16c) — 2/10/2009 @ 5:07 pmA tax holiday would take a lot longer to create jobs and would probably end up creating a lot fewer and a smaller percentage of construction work, which is key because it keeps 20-something males away from trouble-making long enough to reach emotional maturity without going bad.
If we were just looking at a mathematical way to stimulate the economy, a tax holiday is indeed far more efficient at pumping cash into the economy at higher velocity.
But we have to recognize that there is a systemic breakdown, both in the economy and in the financial system.
We need to rebuild an employment infrastructure that’s been devastated by slow, steady declines in big manufacturing enterprises over decades and by a management compensation system that rewards short-term gains at the expanse of long-term stability and planning.
No one can be sure this particular stimulus bill will achieve that. but it looks to me headed in the right direction.
Act II will be tough, though. If these massive government projects gets a large segment back to work, what happens when the projects are completed?
Hax Vobiscum (edacf7) — 2/10/2009 @ 5:08 pm“If these massive government projects gets a large segment back to work, what happens when the projects are completed?”
Those folks go unemployed because folks like myself, a private employer, hesitate to hire a public sector employee. In general, most are useless, slow and always looking for excuses for failure.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:15 pmC’mon, Rob! The problem with our world is the Big Bosses. You know that!
The Big Politicians, though, are always on our side!
Seriously, this kind of weird disconnect is common from people who have never had serious jobs. For them bosses are The Man and the source of all their pain…because there is all this money call profits and The Man has jetskis and big cars and doesn’t work hard…
Paul Tsongas was a fair minded Democrat a few years ago. Check out what he said during the Clinton administration:
But too many folks have a cartoonish view of The Man.
Eric Blair (ec334b) — 2/10/2009 @ 5:16 pm“You cannot redistribute wealth you never created. You can’t be pro-jobs and anti-business at the same time. You cannot love employment and hate employers.”
Amen.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:18 pmAs long as the investment class has doubts about the ability of the economy to generate a return on investment, capital will sit on the sidelines as it did in the 1930’s. It is called a “capital strike” and there is no known way that the government can stop it by intervening in the economy. The way for government to encourage an end to a capital strike is to reduce its’ interference in the economy so that the usual forces may reassert themselves.
“Those who forget history are doomed to repeat it; first as tragedy, then as farce.”
AD (631e91) — 2/10/2009 @ 5:19 pmMost of the spending in the “stimulus” bill doesn’t occur until 2010 or 2011.
Why?
Really? That’s odd… percentage-wise, very few 20-something males work in construction, yet most seem to do just fine. I’d really like to see where you’re getting this peculiar idea.
So it would work quite well…
…but wouldn’t let you reorganize society the way you want.
Which, BTW, is why it’s attractive to me — it would let the market sort things out by itself, by giving people the opportunity to make the decisions on how their labor is allocated.
What makes you say that? Which particular elements lead to that conclusion, and how do you square that with the clearly wasteful elements (dog parks, frisbee golf courses) and the blatantly unrelated elements?
Rob Crawford (b5d1c2) — 2/10/2009 @ 5:27 pmIn Hack’s world, he sees teeming hordes of unemployed construction workers wandering around, pillaging everything in their path. If only the government had spent a couple more trillion dollars.
JD (341fdd) — 2/10/2009 @ 5:27 pmConstruction jobs at make work prices. I priced the ‘jobs’ in my area that are proposed for the stimulus. Most of them are make work projects with padded payrolls and unaccounted spending to keep the environmentalists happy. If you want a $16m roundabout for an intersection with no accidents in the last 15 years, well, then, this is a good thing. You could pay someone a lot of money to stand there and warn people for $16m. But, we’ll have this make work project, and we’ll have the environmentalists to pay off for the privilege of spending government (“free!”) money.
At least LBJ actually put people to work at prices that made sense, and had a budget to work with. There’s no budget here – it’s simply graft.
You thought spending in Iraq was corrupt? Wait until you see the state snouts into the trough of “free” money.
steve miller (3381bc) — 2/10/2009 @ 5:28 pmOn this issue of Executive Compensation I want to add a few thoughts …
1) CEO of Private Companies rarely get compensated for failure because the Owners are highly integrated in the compensation plan and there are usually few of them.
2) CEO of Public Companies are frequently OVER COMPENSATED for the opposite reason. Owners are so fragmented and uninvolved. CEO and the Executive Team basically become stewards of a company with no oversight.
3) With respect to compensation of Public Company CEOs, the biggest mistake was integrating stock grants as a panacea. It was turned into a comp game by management where the true costs where hidden from shareholders.
I don’t want the Feds getting involved in how much Disney’s CEO gets paid but I also don’t think it a bad idea the Gov.t make it ILLEGAL for management to engage in building “poison pills” or other anti buy-out provisions, ILLEGAL for Directors to insulate themselves from civil suits, and ILLEGAL for CEOs to select their own compensation committee.
Their has been plenty of malfeasance in Public Companies with mandarins enriching themselves for poor performance while taking advantage of a lax SEC, et al.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:29 pm“Most of the spending in the “stimulus” bill doesn’t occur until 2010 or 2011.”
This is Obama’s 2012 Campaign re-election kitty.
Da boy is not dumb.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:31 pmIf you want to see the comment Peter thought I censored — the one he was so proud of — it’s comment 21. It was stuck in the filter along with several comments by conservatives — for the same reason: use of a profanity (in Peter’s case, the word “horseshit.”)
Nowadays, comments with profanity like that go automatically into moderation. I end up approving almost all of them; it was a prophylactic measure I took days ago to deal with the resident stalker.
I like it. You can use profanity, but if it’s the harsh kind (the fucks, cunts, shits, bitches, etc.) you may end up waiting a few hours for the comment to appear. I don’t feel so bad about that.
Patterico (cc3b34) — 2/10/2009 @ 5:32 pmthe thing is, we HAVE TO ACT NOW!!!!ELEVENTY111!!!
We can’t examine the bill. We can’t debate whether it’s good or bad. We have to sign it up by Feb 13th so they good Congressional representatives can have a holiday.
Plus, the staff of The Big O! has been working real hard and needs some time off. You know, the staff that was forced at the point of the gun to work for The Big O! What? They weren’t forced to work? They chose to do so, and now they’re complaining?
How rich.
Next you’ll be telling me that some of them pulled an Ivana Trump: only the little people pay taxes.
steve miller (3381bc) — 2/10/2009 @ 5:34 pmhttp://news.yahoo.com/s/ap/20090210/ap_on_he_me/med_medicare_disappointment
OT … Interesting article for those in the health care debate or industry.
Not surprising to me because the program did nothing to change Patient or Physician incentives or risks. So it failed.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:36 pmwell, I’m glad that comment came out of moderation, because it so clearly set everything straight. A man runs for president promising one thing (“most ethical! no lobbyists! PayGo!”) and does another thing.
Meet the New Boss.
Same as the Old Boss.
Schadenfreude can be an especially rich treat at times.
steve miller (3381bc) — 2/10/2009 @ 5:36 pmYeah, I just don’t get that. Somehow, businesses that compete for my voluntary custom are more of a threat to my liberty than the government, which has a police force, subpoena power, and detailed records of my financial history. Oh, and they want to get my complete medical history, too!
I do love the bit about shirking somehow being a lauded quality in American workplaces. Where does that idea come from? I’ve worked with some shirkers — even had the misfortune to report to some of them — but those types always seem to end up as laughingstocks. There are some who manage to bullshit their way through, but those types have to outrun their own reputations.
The only thing I can think of is confusing people who reduce the amount of work that has to be done with people who avoid doing the work at all.
Rob Crawford (b5d1c2) — 2/10/2009 @ 5:36 pmSteve, your use of my favorite German got me very excited.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:38 pmGerman word … ack.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:39 pmI don’t know how someone impersonated The Big O!, because I’m sure I heard Him say “And that [the 1.4 trillion dollar porkulus package] is part of what the election in November was all about.”
Is this where Peter swears again? Because he’s so cute when he does so.
steve miller (3381bc) — 2/10/2009 @ 5:39 pmUeber, you crack me up sometimes. You just made a Freudian slip, where you say one thing but mean your mother.
steve miller (3381bc) — 2/10/2009 @ 5:40 pmNext you’ll be telling me that some of them pulled an Ivana Trump: only the little people pay taxes.
Comment by steve miller — 2/10/2009 @ 5:34 pm
Don’t you mean “Leona Helmsley”?
AD (631e91) — 2/10/2009 @ 5:42 pmSteve, you can laugh at me anytime.
Beats watching American Idol with the Mrs. Good god what puke.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:45 pmYeah, one of those ladies. I first had Imelda Marcos and then realized she was the shoe lady.
Imelda, Ivana, Ileona – they all have names starting with “I”
steve miller (3381bc) — 2/10/2009 @ 5:46 pmLeona.
Good liberal democrap she was, she left over $10MM to care for her dog.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 5:47 pmComment by Obama über alles!!!!! — 2/10/2009 @ 5:47 pm
AD (631e91) — 2/10/2009 @ 5:55 pmWell, the Govt didn’t need her money as it had all that loot from the “Little People”.
Did anyone else know that our economy was designed to keep 20 year old males from going crazy?
JD (341fdd) — 2/10/2009 @ 6:01 pmI thought that was marriage.
steve miller (3381bc) — 2/10/2009 @ 6:08 pm“You cannot redistribute wealth you never created. You can’t be pro-jobs and anti-business at the same time. You cannot love employment and hate employers.”
Yep, that’s about half of the truth, undeniably.
Here’s another portion:
Wealth isn’t created by photo-synthesis or any magical marketplace hand alone. It requires trade, which requires roads and rules and a population that’s well-educated enough, overall, to understand the rules.
The rules have to be fair and, crucially, perceived as fair. In order for that, the playing field has to be seen as level. What’s the point of having perfectly fair referees in a football game if it’s played on a ski slope, with one team always defending the downhill side?
If we go a little beyond the Ayn Rand nursery school fables, we see that our economy is global and multi-national. The competition is among nations that plan their industries and their economies and the U.S., the only industrialized nation that won’t admit that it plans its economy. Typically, our competitors use industrial planning to achieve long-term goals at the expense of short-term gains. Some are good at it and it works. Others fail. But the key to success isn’t in the ideology or choice of systems, but in the efficiency and intelligence with which it is implemented.
The U.S. is culturally averse to industrial planning. So I don’t think we can solve our problems by simply transplanting an Asian or European model, without transplanting some of the culture as well.
Granted, Ayn Rand’s worldview is a lot pithier. But there you have it…
Hax Vobiscum (edacf7) — 2/10/2009 @ 6:13 pmThe response to Obama administration briefings on their financial market plans? Laughter … yep. Laughter.
The Obama administration has a promising career as clowns ahead of them.
Running a government? Not so much.
SPQR (26be8b) — 2/10/2009 @ 6:14 pmIt’s amazing that we’ve managed to stumble into being the economic engine of the world while being such a bunch of ignorant rubes.
Pablo (99243e) — 2/10/2009 @ 6:16 pmI thought marriage was designed to drive men crazy.
JD (341fdd) — 2/10/2009 @ 6:17 pmCongresscritterers and policy wonks laugh. Investors have a slightly different reaction. But who needs them when we’ve got a bottomless supply of money?
Pablo (99243e) — 2/10/2009 @ 6:19 pmIf only we wuz all as smart az thows yuro endustreal planing peoples thin Amerikkka kood hav anne ekonomee that akshually workz.
JD (341fdd) — 2/10/2009 @ 6:24 pmPablo, the U.S. share of global GDP has been declining in fits and starts since the late 1970s. There was a good stretch during the Clinton boom, when China, Japan and parts of Europe were in the doldroms, but we went into a freefall, in relative GDP growth terms, under Bush.
And the U.S. does industrial planning — via the military industrial complex. It’s how we guarantee at least a degree of technological superiority in some key sectors. We all know that the Internet was the direct result of such planning, via the Defense department, as one example.
My point was that, politically, U.S. politicians need to pretend there’s no planning going on. Because if they do, the mediocre media will call them communists.
Hax Vobiscum (edacf7) — 2/10/2009 @ 6:25 pmJD: can you please insert more douche-fetish references. They make my day.
Hax Vobiscum (edacf7) — 2/10/2009 @ 6:27 pmSure we did, Hacks.
Pablo (99243e) — 2/10/2009 @ 6:32 pm“military industrial complex”
and was 9-11 an inside job, too?
steve miller (3381bc) — 2/10/2009 @ 6:34 pmHacks – When you act like a mendoucheous douchenozzle, I will point it out.
I always love it when some Leftists drones on about the “military industrial complex”.
JD (341fdd) — 2/10/2009 @ 6:35 pmHack making up economic facts again. No surprise. I’m continually astonished at how ignorant liberals are of the real effective tax rates, the actual trend toward contributions by income percentiles, and economic growth rates.
Liberals are just continually spouting myths unsupported by reality.
SPQR (26be8b) — 2/10/2009 @ 6:35 pmWe need to rebuild an employment infrastructure that’s been devastated by slow, steady declines in big manufacturing enterprises over decades and by a management compensation system that rewards short-term gains at the expanse of long-term stability and planning.
The last group of folks who tried to restore big manufacturing enterprises was called the Soviet Union. China may be nominally communist but they know better than this nonsense.
Mike K (2cf494) — 2/10/2009 @ 6:37 pmHax,
Industrial planning has not really worked anywhere.
It has taken really poor to less poor but if you look at all wealthy countries their competitive industries (**job and wealth creators**) developed with relatively little Gov.t support.
You need to go read a Michael Porter book Competitive Advantage of Nations .. it discusses these issues and is time tested since 1990
http://drfd.hbs.edu/fit/public/facultyInfo.do?facInfo=bio&facEmId=mporter
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 6:37 pmComment by Pablo — 2/10/2009 @ 6:32 pm
There you go, again. Bringing up those inconvenient facts.
Don’t you know that facts to a Liberal are like Kryptonite to Superman?
You should be ashamed of yourself.
AD (631e91) — 2/10/2009 @ 6:38 pmI got a laugh out of that one too, Pablo. The more he blathers on, the more he exposes himself.
Dmac (49b16c) — 2/10/2009 @ 6:38 pmSPQR – The “reality” based community meme was never more approriate, huh?
JD (341fdd) — 2/10/2009 @ 6:41 pmLet’s ask Hacks if he’s ever heard of Adam Smith, since he seems to only know of Ayn Rand, for some reason.
Dmac (49b16c) — 2/10/2009 @ 6:42 pmWho is Edward Deming, Hax?
Dmac (49b16c) — 2/10/2009 @ 6:43 pmIt’s almost funny when this guy makes stuff up, but then I think, “I wonder if he really believes what he experiences in an mescaline high?”
steve miller (3381bc) — 2/10/2009 @ 6:45 pm“Industrial planning has not really worked anywhere.”
OuA – C’mon, give Hax a break. Sure it does, it just keeps getting derailed by bad harvests.
daleyrocks (5d22c0) — 2/10/2009 @ 6:45 pmActually the least discussed issue when talking taxes and income equality is mobility between income deciles as people get older, more educated, etc.
My research some time back showed the USA has the most upward and downward mobility in the Industrial World and the threee biggest factors are Age and Education and Temporary Factors like Unemployment or Illness …
That is to say if you start your working life in the bottom 20% you still had a 33% chance of getting into the top 20%. If you educated yourself, did not die young and managed to stay employed …. you did even better.
Anyway, point is Poverty is not static in the US but moreso in countries where the Gov.t does “industrial planning” and the like.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 6:45 pmDmac,
Bradley J. Fikes, C. O.R., who wants DRJ back! (0ea407) — 2/10/2009 @ 6:45 pmDon’t fry his brains by mentioning Edwards Deming.
Edward Demming was not an economist and not a good reference for this thread.
Pick a new one.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 6:46 pm“Government planning” has been shown to work in how many cases?
All hail the Glorious Workers’ Party.
steve miller (3381bc) — 2/10/2009 @ 6:47 pmThough Hax might be unfamiliar with the likes of Adam Smith or Edward Deming,
AD (631e91) — 2/10/2009 @ 6:47 pmhe certainly demonstrates the accuracy of Dr. Laurence J. Peter.
Obama uber alles, you are correct. The US has an extraordinary amount of mobility among economic levels.
SPQR (26be8b) — 2/10/2009 @ 6:48 pmDr Demming by the way.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 6:48 pm“We need to rebuild an employment infrastructure that’s been devastated by slow, steady declines in big manufacturing enterprises over decades and by a management compensation system that rewards short-term gains at the expanse of long-term stability and planning.”
Hax – I was as intrigued by this one as others. You don’t happen to have any support for your theory that it is the management compensation system we’ve developed that has led to the decline in our big manufacturing enterprises, do you? Perhaps the website or book you lifted it from? I’m interested in how the causation is proved.
daleyrocks (5d22c0) — 2/10/2009 @ 6:48 pmEdwards Deming is famed for helping improve U.S. and Japanese productivity. Obviously totally irrelevant to a thread about economic policy.
Bradley J. Fikes, C. O.R., who wants DRJ back! (0ea407) — 2/10/2009 @ 6:50 pmI get the feeling Hacks wanted to say “…but we went into a freefall, in relative GDP growth terms, under Chimpy McHitlerburton.” but thought better of it. Gravitas, dontcha know.
Pablo (99243e) — 2/10/2009 @ 6:50 pmMore importantly SPQR, the three factors driving upward mobility are all controllable by the individual ….
1) Education
2) Getting older / being healthy
3) Avoiding unemployment
They represent approximately .75 on the R Squared meter.
So ,,, there is 25% which may be “luck” or some variable I could not source.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 6:50 pmDepends on how you attained those numbers. If all of the 80% in the middle class were middle class because they worked for it, then yes, ‘twould approach utopia.
But if a significant part of that 80% attained that income level by shirking work and leeching off those who did, then no, it would not be approaching utopia.
Comment by The ant-socialist Dana — 2/10/2009 @ 4:39 pm
I’m glad we finally agree Dana. Now the problem is how do we get 80% Middle Class that worked for it?
Oiram (caa738) — 2/10/2009 @ 6:51 pm“… expanse (sic) of long-term stability and planning.”
Long-term stability is antithetical to the creative destruction that marks the dynamism of the Capitalistic System.
AD (631e91) — 2/10/2009 @ 6:52 pm“Hack making up economic facts again.”
SPQR – That’s harsh. It’s not like he hasn’t supplied a plethora of links and data to support everything he has said here. What? Wait a minute.
Nevermind.
Carry on.
daleyrocks (5d22c0) — 2/10/2009 @ 6:53 pmI’m well aware of Dr. Deming’s field of expertise – but since Hacks can’t help himself from blathering about all manner of subjects that have nothing to do with economic policy, I’ll play along.
Dmac (49b16c) — 2/10/2009 @ 6:53 pmI’m quite pleased Hacks is out of moderation – this gets better as he goes deeper into his own private Idaho.
Dmac (49b16c) — 2/10/2009 @ 6:55 pmEvery time this kind if idiocy comes up, I think back to meeting Russell Kirk. And, I think about how hard it must be for someone like Hacks to get out of bed in the morning when The Man is conspiring to keep him down.
JD (341fdd) — 2/10/2009 @ 6:55 pmDmac, I was responding to #227.
Bradley J. Fikes, C. O.R., who wants DRJ back! (0ea407) — 2/10/2009 @ 6:55 pmBradley, yes Dr Demming was a great consultant to companies but his field of work did not include Macro-Economics, Micro-Economics, Finance, Financial markets or even Industry Level competitive analysis.
Dr Demming was a humanist with a math degree. He believed most people perform well if you teach them the right way and don’t treat them like idiots. He also believed very very very few people deserved out-sized compensation rewards and would likely agree with Obama’s crew on limiting comp.
But Dr Demming was not a big picture theorist nor would he have had strong thought on FDR or Obama’s largesse or belief in Gov.t planning.
In context to this thread, his teaching are mostly out-of-place.
Juss saying.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 6:56 pmOiram,
In life, fairness is 95% preparation.
Look at your God, BHO.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 7:00 pmHere’s the full set of rules to avoid poverty, courtesy of Walter Williams:
If I were to add anything, it would be “Don’t buy things you can’t afford”.
Pablo (99243e) — 2/10/2009 @ 7:00 pmAh, crap. Here’s the link for that.
Pablo (99243e) — 2/10/2009 @ 7:01 pm“Now the problem is how do we get 80% Middle Class that worked for it?”
Edumacation
Skills
Limit Illegal Immigration
Oiram – That is a huge middle class your are talking about. Given that 45% of Americans don’t pay income taxes as it is and with proposals on the table for further cuts, you are effectively asking 50% of the population to carry the other half, in a progressive manner. No good, while the politicians continue to demagogue about the “rich” not paying their fair share.
Focus on raising the bottom, not penalizing the top. Isn’t Obama fond of saying use carrots not sticks. Charter schools and vouchers, job training. Illegal immigration puts downward pressure on wages, which Democrats are too cowardly to admit.
daleyrocks (5d22c0) — 2/10/2009 @ 7:02 pmhttp://en.wikipedia.org/wiki/W._Edwards_Deming
Fair wikipedia outline. Deming. Sorry.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 7:03 pmSee Dr. Williams’ advice, Oiram. It’s quite simple, really.
Pablo (99243e) — 2/10/2009 @ 7:04 pm“I’m quite pleased Hacks is out of moderation – this gets better as he goes deeper into his own private Idaho.”
Mr. Potato Head?
daleyrocks (5d22c0) — 2/10/2009 @ 7:05 pmI am still dumbfounded by this bit of illogic from Hax.
Other than government employees, how are “rich people” reducing their effort at the prospect of increased marginal taxation “getting less out of the GOVERNMENT.” They are getting less out of their private employer, should they reduce their efforts. Or, should they keep their behavior the same, they are receiving less because the government takes more. That you think we earn what we do at the pleasure of some benevolent government deigning to allow us to keep some of its money tells me much more about you than it does illustrate your point. When I start a business and it is successful, it’s not getting more “out of the government” in any way.
Conversely, poor people currently receive direct transfer payments from the government – food stamps, WIC, section 8 housing etc. If the government were to reduce these, and / or set a work requirement, they would have incentive to … work. This actually happened, as you may remember, under Bill Clinton and the Republican Congress. Welfare reform.
carlitos (78dfe1) — 2/10/2009 @ 7:16 pmEasy, carlitos, according to Hacks, it is from government that all blessings flow.
SPQR (26be8b) — 2/10/2009 @ 7:21 pmOoh Pablo, that post at 212 leaves a sting.
Hax, please add US share of global GDP from 2000 – 2008 to your list of research, along with Zogby ‘disowning’ polls, taxation by quintile, etc. P3WND
carlitos (78dfe1) — 2/10/2009 @ 7:24 pmAccording to Hacks, in Bush administration, we had to live in a shoebox box in the middle of the road.
SPQR (26be8b) — 2/10/2009 @ 7:24 pmGood point on illegal immigration. Quick – everyone think back to your first few jobs. Are illegal immigrants performing those jobs today?
As a teen, I was fry cook at KFC, busboy, and factory floor sweeper. At least 2 of those jobs are being performed en español en estos días.
carlitos (78dfe1) — 2/10/2009 @ 7:28 pmI have a quote that seems to apply here:
“Throughout history, poverty is the normal condition of man. Advances which permit this norm to be exceeded—here and there, now and then—are the work of an extremely small minority, frequently despised, often condemned, and almost always opposed by all right-thinking people. Whenever this tiny minority is kept from creating, or (as sometimes happens) is driven out of a society, the people then slip back into abject poverty.
This is known as ‘bad luck’.”
– Robert A. Heinlein
Is that succinct enough ?
Mike K (2cf494) — 2/10/2009 @ 7:39 pmApropos of Dr. Capt. Mike K.’s quote, here’s mine:
“Poverty is not a mortgage on the labor of others — misfortune is not a mortgage on achievement — failure is not a mortgage on success — suffering is not a claim check, and its relief is not the goal of existence — man is not a sacrificial animal on anyone’s altar nor for anyone’s cause — life is not one huge hospital.”
– Ayn Rand
Bradley J. Fikes, C. O.R., who wants DRJ back! (0ea407) — 2/10/2009 @ 7:46 pmCamille Paglia on the pork-u-lus:
Why in the cosmos would the new administration, smoothly sailing out of Obama’s classy inauguration, repeat the embarrassing blunders of Bill Clinton’s first term? By foolishly promising a complete overhaul of healthcare within 100 days (and by putting his secretive, ill-prepared wife in charge of it), Clinton made himself look naive and incompetent and set healthcare reform back for more than 15 years.
President Obama was ill-served by his advisors (shall we thump that checkered piñata, Rahm Emanuel?), who evidently did not help him to produce a strong, focused, coherent bill that he could have explained and defended to the nation before it was set upon by partisan wolves. To defer to the House of Representatives and let the bill be thrown together by cacophonous mob rule made the president seem passive and behind the curve.
Joe (17aeff) — 2/10/2009 @ 7:53 pmThis reads like the Obama cabinet!
Vermont Neighbor (ab0837) — 2/10/2009 @ 7:57 pm“This actually happened, as you may remember, under Bill Clinton and the Republican Congress. Welfare reform.”
Carlitos – The Crap Sandwich seeks to undo that Clinton era welfare reform and bring back lifetime welfare.
Happy days and a larger democrat voter base are indeed here again.
daleyrocks (5d22c0) — 2/10/2009 @ 8:03 pmWhenever this tiny minority is kept from creating, or (as sometimes happens) is driven out of a society, the people then slip back into abject poverty
Sort of along the lines of the following…
^ And when the people of a community or society (perhaps including a nation that sent Obama to the White House) really are their own worst enemies, it’s quite difficult to sympathize with them. In fact, it’s rather easy to say “if you want to see something or someone stupid, look in the mirror!”
Mark (411533) — 2/10/2009 @ 8:09 pmJoe,
Barack is a diplomat, not a leader.
That is why the bill is pork-u-lus.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 8:09 pmActually best story I ever heard was in Venezuela ….
Basically, a land owner had his lands taken away and it was given to the “poor.”
The land owner said OK and he basically took his machines and stored them.
The poor farmers BOMBED. They had not the machinery, expertise or anything to make it work.
That same land owner now rents the machinery to the farmers, charges them for consulting and financial services and makes more money now than before …… Oh, and he no longer pays tax on the land he owns.
Classic Socialism.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 8:12 pmPablo: you link to a report comparing U.S. economic performance to that of Canada, Japan the the EU, for 2001-2005. That has nothing to do with portion of global GDP accounted for by the U.S.
As you may or may not be aware, the economies of China, India, Russia and Brazil have been storming ahead at between 7 and 11 percent a year, compared with the less-than 3 percent rates cited for the U.S. in the report you linked.
Granted, these economies are much smaller than the U.S. and on a GDP per-capita basis, their growth outperforms less. But still, the U.S., as I pointed out, is no longer the global economic engine: rather, it is one of many.
Here’s some numbers that demonstrate:
World (millions) United States U.S. share (%)
1995 29,391 7,398 25.2
1996 30,080 7,817 26.0
1997 29,928 8,304 27.7
1998 29,682 8,747 29.5
1999 30,786 9,268 30.1
2000 31,650 9,817 31.0
2001 31,456 10,128 32.2
2002 32,714 10,470 32.0
2003 36,751 10,961 29.8
2004 41,258 11,712 28.4
2005 44,455 12,456 28.0
Average annual rate (percents),
1995-2006 10.6 (global) 6.8 (U.S.)
source imf.org
As we can see, the U.S. share grew during the Clinton era, peaking in 2000, and has steadily declined since then.
The last numbers are the key. As we can see, the global economy is growing almost twice as fast as that of the U.S., and the differential is accelerating.
Here’s what Michael Milken says:
Hax Vobiscum (edacf7) — 2/10/2009 @ 8:13 pm“By 2030, Asia will be 58% of the world’s GDP. By 2050, China will be the largest economy, with 44.5% of world GDP vs. 35% in the U.S. India will be at 28%. India’s and China’s economies were much larger in 1820 than they are today. Back then, China was 29% of the world and India was 16%. The U.S. has been the unbelievable success story of the world since then. But 2050 will look a lot more like 1820.”
Ah, I see the table formatting didn’t make it. Well, you’ll just have to squint, I suppose. Fair enough, since some of you will surely prefer to continue to ignore the data.
Hax Vobiscum (edacf7) — 2/10/2009 @ 8:15 pmAccording to your global share numbers, Hax, 2001 and 2002 were both above the “peak” of 2000. Good call.
John Hitchcock (fb941d) — 2/10/2009 @ 8:20 pmHax,
A growing pie for all is good for all.
Thanks for point it out.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 8:21 pmLet me also point out another piece of research …..
Countries with low indices of human capital and infrastructure always have the capacity to grow much faster. They are further down the S Curve.
The real question is can they break through the 20K GDP per capita that seems to be a “magic number” to living like the west and can they grow that into the 40/50 that USA, Switzerland is.
That takes lots more capital accumulation in terms of infrastructure and education.
Obama über alles!!!!! (48dd5e) — 2/10/2009 @ 8:25 pmWhy would you expect it to when I was responding to this comment of yours?
Set those goalposts down, junior. You’re gonna hurt yourself.
Pablo (99243e) — 2/10/2009 @ 8:28 pmJH,
And 2005 was 3 points higher than 1995. Some freefall, eh?
OuA,
Yeah, until you get hit in the face with it. 🙂
Pablo (99243e) — 2/10/2009 @ 8:32 pmI looked at another source of data and got this.
The US share of GDP peaked in 1950 as a result of World War II, an event probably unknown to some trolls. The way I read that bar graph, our share was pretty stable the past 20 years. The real decline was 1950 to 1980, care of LBJ, Nixon and Jimmy Carter.
What is happening is that total world production is climbing among third world countries that are modernizing. It is not the result of any decline on our part. Mature economies do not grow at 9% per year. Sorry but this is another example of economic ignorance. Could we suggest a reading list ?
MIke K (2cf494) — 2/10/2009 @ 8:33 pm“There was a good stretch during the Clinton boom, when China, Japan and parts of Europe were in the doldroms, but we went into a freefall, in relative GDP growth terms, under Bush.”
Hax – Anyone who is knowledgeable understands growth coming from areas such as China and India, but your historical data doesn’t present that. Your statement above also doesn’t explain what you mean by “relative.” Relative to the growth of who Hax? Are you just trying to cherry pick some faster growing countries we all know about or is there a meaningful comparison you are attempting?
daleyrocks (5d22c0) — 2/10/2009 @ 8:34 pm“A growing pie for all is good for all.”
Pablo – That way Michelle doesn’t have to take away as much of yours to give somebody else.
daleyrocks (5d22c0) — 2/10/2009 @ 8:36 pmBy the way, did anyone notice the large share of world GDP of China and India from 1500 to 1800 ?
MIke K (2cf494) — 2/10/2009 @ 8:37 pmThat one is going to leave a mark …
JD (341fdd) — 2/10/2009 @ 8:41 pmI like that chart, Mike K.
China + India = 33 pc global population.
China + India = 17 pc gross global product.
USA = 5 pc global population.
John Hitchcock (fb941d) — 2/10/2009 @ 8:51 pmUSA = 22 pc gross global product.
Of course that chart is pure percentages and bears no relationship to actual global GDP.
Here’s another small economics lesson.
When you don’t drill for oil, RVs don’t sell.
MIke K (2cf494) — 2/10/2009 @ 9:00 pm“India’s and China’s economies were much larger in 1820 than they are today. Back then, China was 29% of the world and India was 16%. The U.S. has been the unbelievable success story of the world since then.”
Hax – I blame Bush.
daleyrocks (5d22c0) — 2/10/2009 @ 9:09 pmDoes the Japanese Constitution call for universal healthcare? I am sure that multi-trillion dollar social programs are much easier to fit into a budget when you can rely on the US to aid and assist in your national security.
Comment by JD — 2/10/2009 @ 5:04 pm
Don’t know whether or not their constitution calls for universal health care but I’m quite certain, based on simple geography, that Japan is not forced to pay for educating, feeding or medicating 12-20 million illegal immigrants.
Hax,
Chris (b886a5) — 2/10/2009 @ 9:27 pmAccording to your data, 2001 would appear to be the high point of US GDP relative to the rest of the world, not 2000 (I read it-and there’s no statistical difference between 01 and 02, either). The decline is minimal and a lot of the Chinese growth in global GDP is the result of their being an assembly point for lots of parts that are shipped there from other more technologically advanced nations. The parts are assembled there and then shipped elsewhere. China is credited with the value of the finished product even though the product (computer, gadget whatever) was merely assembled there. Markets are dynamic but we’re not losing ground in any meaningful way to China yet.
Hax,
I’m on blackberry, so can’t view tables and such with detail, but those numbers don’t jive. The EU 25, the anglosphere and japan represent 75 – 80% of gdp. For the US to outperform that group and lose share is counter-intuitive, especially given that those economies grew as well (albeit more slowly). These are ballpark estimates because, again, I’m on blackberry and can’t research right now.
Let’s take a 1 year example, using rates that were typical of the Bush terms:
– 50% of world (EU 25, japan mostly) grows at 3%
– ~30% of world (USA) grows at 5%
– 5% of world is clusterf*** (mideast/africa)-no growth
– 15% of world – emerging markets of brazil, india, greater china grow at 10%
Assuming global GDP of 100, here are share changes to global gdp for one year:
“Old world” GDP goes from 50 to 51.5 year-on-year
USA goes from 30 to 31.5 year-on-year
3rd world gdp stays at 5, share reduced to 4.8
Growing emerging markets go from
Emerging markets go from 15 to 16.5
So, global GDP grows 4.7%.
Share change as follows:
carlitos (0ffd49) — 2/10/2009 @ 10:04 pmEU 25/japana/canada/australia/nz – from 50 to 49.3%
USA – from 30 to 30.15%
3rd world – stagnant gdp, share loss to 4.8%
Emerging markets – from 15 to 16.5, increasing share of global gdp to (16.5 / 104.5), or 15.8%
With my numbers, the US’ global share of gdp after these growth rates is stagnant or slowly increasing. Given that europe/japan were much more stagnant for many years, I find it hard to believe that the USA lost substantial gdp share during l’epoque bush.
And even if (big if) the US lost share of global GDP during the bush years, how exactly does that negatively affect Americans? Does an increase in the economic status of your average brazilian hurt me? No, it does not, because economic growth is not a zero-sum game.
carlitos (6e32db) — 2/10/2009 @ 10:29 pmThere was a good stretch during the Clinton boom, when China, Japan and parts of Europe were in the doldroms, but we went into a freefall, in relative GDP growth terms, under Bush.
I was arguing several weeks ago with some dreamy eyed member in my family (a cousin) who voiced the argument that putting Obama in the White House would be good for out pocketbooks because, after all, the last time the US economy was so great was when Bill meaning-of-is-is Clinton occupied the Oval Office.
First of all, and regardless of who the president is, I’ve never been one to either praise or damn one solitary guy (ie, the fellow in the White House) for the general traits and condition (good or bad) of the huge, enormous, gigantic, multi-dimensional American economy.
However, the one thing I will lay at the feet of that one person is how he affected (or affects) my personal tax rates, either by moving them up or down, and whether those in the public sector — in particular government-employee unions (and their members, and all their government-paid holidays, and cozy retirement benefits, etc) — under his watch are living large while we saps in the private sector are required to stand by on the sidelines and feed those in the public sector.
Beyond that, I certainly won’t credit a president for economic trends that quite obviously rest upon forces far beyond his control. For example, the stock-market-crazed years of the 1990s (otherwise known as the dot-com boom), when the advent of something called the Internet — and the realization of its economic potential — really kicked into high gear.
Mark (411533) — 2/10/2009 @ 10:38 pmGovernment funding really helped us with that education thing, didn’t it?
(Warning: That link takes you to my blog.)
John Hitchcock (fb941d) — 2/10/2009 @ 11:43 pmCarlitos: Why are you assuming 5% growth for the U.S.? That’s about twice the Bush administration average? (I’m impressed with your thumb speed, though.)
More important, I never said other industrialized countries were outperforming the U.S.
I said the U.S. share of global GDP was declining and my comment came in response to Pablo’s? claim that the U.S. is the engine of global economic growth.
The data show clearly that U.S. share is declining and has been since the Bush administration and, longer term, since the 70s.
But declining GDP share tells only part of the story. A more telling figure is the almost doubling of U.S. debt held by Asians to almost half of all outstanding Treasury debt during the Bush administration. (47 percent, last time I checked)
How can the U.S. be the engine of economic growth if China, Japan and South Korea finance almost half its debt, while the U.S. lends them virtually nothing?
The Bush years saw the slowest economic growth since the Great Depression. But that’s not even the worst part. What makes it crystal clear that big changes are needed is that almost all of the economic growth came from consumer spending and much, if not most, of the consumer spending came from home equity loans and mortgage refinancing.
Under normal circumstances, it is simply not possible for consumers to borrow enough to have that kind of effect on economy at the same time that the government is also borrowing and spending heavily. Under normal circumstances, that would drive interest rates higher, deterring and disqualifying additional borrowing, preventing a bubble.
That didn’t happen because the kept short-term rates artificially low, while long-term rates were held down because China, Japan and South Korea were perfectly willing to buy more and more U.S. debt.
This was not all bad, as it does act as a kind of subsidy to, not from, the U.S. But the problem is that it eventually enabled the massive housing bubble and home equity spending binge that lead to the current crisis.
Engine, indeed. The U.S., for the past decade, has been a massive consumption engine, while Asia and and the BRICs have increasingly been taking care of production. So from that point of view, the U.S. has played a role, but not a sustainable one.
If we want to talk about industrial planning, it’s a good idea to talk about actual industries and a very good starting place is the U.S. auto industry.
Why can’t it compete with Japan’s and, even, Korea’s?
A decade ago, in the Clinton era, GM was helping bail out Isuzu and, even, Suzuki, while Ford was taking control of Mazda and Kia and Chrysler was taking a large stake in Mitsubishi Motors.
Now, the tables are turned, except that Japanese and Koreans have little or no interest in rescuing their U.S. rivals, largely because they see very little worth saving in terms of automaking technology and infrastructure.
How did that happen? Coincidence? Can we really blame Jimmy Carter, or Stalin?
I don’t think we can.
The answer is complex and includes not just economic arrangements, but cultural factors that underly those arrangements.
Hax Vobiscum (edacf7) — 2/11/2009 @ 2:34 amHacks simply ignores all of the posts that substantially refute his assumptions and assertions.
JD (c6800b) — 2/11/2009 @ 5:10 amYou’d better check again, Hacks. As of June ’08, the total US debt held by all foreign entities was 27.9% How telling are your facts when they’re so, uh, wrong.
Do explain how Federal debt enabled the housing bubble. It wasn’t driven by low interest rates, it was driven by low lending standards expanding the demand side with lots of buyers who couldn’t actually afford what they were buying.
Unions. Legacy costs and bad labor contracts. This is why the Japanese, German and Korean car companies can do just fine building cars in the US. Their costs are much lower. This is not rocket science.
Pablo (99243e) — 2/11/2009 @ 5:40 amOK Hax, so assume 3% in the US, 1.5% in the other developed markets. Please explain how it was that we went into “free fall in terms of relative GDP growth,” by out-performing half the world’s economies during Bush’s two terms? Growing our share of global GDP for at least the first 2 years?
Right. Except for the negative growth in the early 90’s, early 80’s, mid-70’s, a couple years in the 50’s (based on 2000 $’s) – you can’t be serious? Apples to apples, Bush had a few more hiccups than Clinton, and growth 1990 – 2008 was lower than the preceding 18 years. That’s all you can say with accuracy. “Free fall” is pure fiction.
carlitos (599c37) — 2/11/2009 @ 6:32 amcarlitos and Pablo – First off, you are both racists. Secondly, dontcha know that the reality based community gets to just make things up as they go along?
JD (c6800b) — 2/11/2009 @ 6:48 amIt’s like shooting members of oppressed identity groups in a barrel, JD.
Pablo (99243e) — 2/11/2009 @ 7:25 amthe economies of China, India, Russia and Brazil have been storming ahead at between 7 and 11 percent a year,
“Storming ahead,” you say? Hmmm – please take a gander at the recent figures, and then tell us why you think Russia’s economy is currently tanking, along with China’s and Brazil’s. Oil was the only factor in Russia’s incendiary growth rates over the past few years, and now all of those gains have been obliterated, and civil unrest is spreading from Siberia to the outer regions of Moscow. China’s massive displacement of millions of workers (i.e. unemployed) over the past year has also been the chief factor in widespread demonstrations against the government, due primarily to the economy’s severe descent. Brazil has also been hit hard by the commodity price plunge, and…why even bother to describe it? You’ll just ignore what’s inconvenient and keep spouting discredited memes until the cows come home.
Dmac (49b16c) — 2/11/2009 @ 7:39 amI’ll give a partial on that. Low interest rates make larger loans affordable for low incomes. Had the interest rates tracked with the actual risk of the sub-prime loans, no one could have afforded them.
Of course, the real reaction to charging the correct interest for sub-prime, no-down-payment loans would have been lawsuits and government investigations into “racism”.
Rob Crawford (04f50f) — 2/11/2009 @ 7:45 am“A decade ago, in the Clinton era, GM was helping bail out Isuzu and, even, Suzuki, while Ford was taking control of Mazda and Kia and Chrysler was taking a large stake in Mitsubishi Motors.”
Hax – What years did the U.S. market share of the Big 3 peak? I keep getting the sense you want to take thing back to the Clinton Administration and no further. Why is that?
daleyrocks (5d22c0) — 2/11/2009 @ 7:52 amWhich again is a function of lower lending standards, much of which was due to securitization and federal pressure to make bad risk loans. And how many of these bad loans were ARM’s?
You have a point that low rates played something of a role, but it’s a small one. High risk borrowers should pay higher rates, and federal borrowing has exactly nothing to do with the fact that they weren’t.
Pablo (99243e) — 2/11/2009 @ 8:22 am“More important, I never said other industrialized countries were outperforming the U.S.”
Hax – The following is actually what you originally said:
“but we went into a freefall, in relative GDP growth terms,”
Since you never described what you meant by relative “GDP growth terms” you are certainly free to make it mean whatever you want now. Clarity up front would have been nicer, though.
daleyrocks (5d22c0) — 2/11/2009 @ 8:58 amOkay, then, my apologies Pat.
Peter (e70d1c) — 2/11/2009 @ 10:04 amI think we should all pay what our part of the new bill is right up front let the people really see what this is costing us. We can make payments over the next 4 years right out of our taxes on top of all the other ones. There wouldn’t be much more of this going on.
debbie (8349ff) — 2/11/2009 @ 3:42 pmHow much are the wars costing us per day?
TLove (012115) — 2/11/2009 @ 3:44 pmTLove – Chump change.
daleyrocks (5d22c0) — 2/11/2009 @ 3:47 pm