February 9, 2009
"But I'm not an economist, so I don't know."
(Via Jac.)
I don't know about you, but I'm feeling very queasy about the whole routine of: Trust us, hurry up, your instincts are irrelevant because you're not an expert, stand aside, shut up, obey.
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If there was a single lesson that the last 20 years should've taught us, it'd be that no individual, company, or country can borrow its way to prosperity. This so-called stimulus bill is an economic abortion.
I'm about as queasy as Captain Lovell: "Houston, we've had a problem."
Wing and a prayer indeed.
We know. This bill is all about reparations, class envy and patronage, stimulating the consolidation of power.
The economy? Feh. Who cares now that we're getting ours?
Change is coming like you can't believe. This is not the Obama you were looking for.
I saw a clip of Larry Summners this morning on some news show saying something to the effect that the Republicans had no right to object because they ran up debt to.
Could it be that a former President of Harvard is guilty of such school yard sloppy logic? If we had actual reporters on these shows rather than paid Democratic mouth pieces running them, the host would have interrupted him and said "Larry that is not an answer and you know it." First, by comdeming the Republicans for running up debt, it is assuming that running up debt is a bad thing. Second, assuming it is a bad thing, how does the fact that they did it make somehow ok to do it more now?
The two worst kinds of arguments are appeals to authority and attacks on your oponents credibility. The only arguments being made for the stimulus are just that; we are experts trust us, and the Republicans lost the election and did all these bad things so you can't listen to them. Maybe their are better arguments for the stimulus than that. But, if there are, I find it difficult to believe that a smart guy like Summners can't come up with any.
Doomsday scenarios may work with the leg tingle crowd but for the rest of us, Shapespeare said it best; "Methinks thou doth protest too much."
Since it is Valentine's day week, I submit the following; "Some cupid kills with arrows..."
If the Dems have lost JAC on this, they've lost the country.
There is no economist or group of economists that I would trust to make an accurate prediction of how this will play out.
Predicting success, however, is really far-fetched since it isn't targeted at stimulus even though that is what they are calling it.
They are lying outright, so that gives me my first clue that this bill isn't going to succeed at the stated goals.
They are rushing it - even though most of this urgency isn't scheduled to come until much later. They are claiming "We can't wait" but then 90% the money will not be spent for one, two, or three years!
Equally strange is their apparent need to pretend this bill is bi-partisan.
Lastly, no economist has explained how many of the specific measures in this bill will stimulate anything but Democrat political activists and their friends. To take taxpayer money to fund partisan groups like ACORN at this point is treason.
I don't know about you, but I'm feeling very queasy about the whole routine of: Trust us, hurry up, your instincts are irrelevant because you're not an expert, stand aside, shut up, obey.
Especially considering the track record of economists. There's a reason it's called The Dismal Science.
I have often thought that people with faulty arguments need to have much more education than those who have sound arguments.
I don't know about you, but I'm feeling very queasy about the whole routine of: Trust us, hurry up,
I'm always queasy.
And don't trust, much.
I've learned that the world seems to keep spinning regardless of what I do.
Cutting payroll taxes and letting govt borrow and spend isn't the same as letting Wall Street's investment banks game the system to pump up dotcom and credit bubbles.
"After a period of time, economies go through a long-term debt cycle -- a dynamic that is self-reinforcing, in which people finance their spending by borrowing and debts rise relative to incomes and, more accurately, debt-service payments rise relative to incomes. At cycle peaks, assets are bought on leverage at high-enough prices that the cash flows they produce aren't adequate to service the debt. The incomes aren't adequate to service the debt. Then begins the reversal process, and that becomes self-reinforcing, too. In the simplest sense, the country reaches the point when it needs a debt restructuring. General Motors is a metaphor for the United States....
2008 was the year of price declines; 2009 and 2010 will be the years of bankruptcies and restructurings. Loans will be written down and assets will be sold. It will be a very difficult time....
"Debtors are still too indebted and not able to properly service the debt. Only when those debts are actually written down will we get to the point where we will have credit growth....
"There are too many nonviable entities. Big pieces of the economy have to become somehow more viable. This isn't primarily about a lack of liquidity. There are certainly elements of that, but this is basically a structural issue....
"Efforts were directed [in the '30s] at rekindling lending. But they did not rekindle lending. Eventually there were a lot of bankruptcies, which extinguished debt.
"The Federal Reserve is going to have to print money. The deficits will be greater than the savings. So you will see the Federal Reserve buy long-term Treasury bonds, as it did in the Great Depression. We are in a position where that will eventually create a problem for currencies and drive assets to gold....
"You print a lot of money, and then you have currency devaluation. The currency devaluation happens before bonds fall. ...
"From the U.S. point of view, we want a devaluation. A devaluation gets your pricing in line. When there is a deflationary environment, you want your currency to go down. When you have a lot of foreign debt denominated in your currency, you want to create relief by having your currency go down. All major currency devaluations have triggered stock-market rallies throughout the world; one of the best ways to trigger a stock-market rally is to devalue your currency....
"Taking on those risks in late 2009, or more likely 2010, will be a great move because equities will be much cheaper than now. It is going to be a buying opportunity of the century."
Investment manager Ray Dalio in Barron's.
I am really excited about the stimulus package.
I think it is the words "stimulus package" that get me a little hard.
Have a great week and great year.
Special Super Hugs and Kisses.
If the economists knew, we would not be in this mess in the first place.
If the economists knew, we would not be in this mess in the first place.
Who amongst us doesn't love a big stimulus package.
"I don't know about you, but I'm feeling very queasy about the whole routine of: Trust us, hurry up, your instincts are irrelevant because you're not an expert, stand aside, shut up, obey."
Eight years would wear anyone out.
So don't trust the experts, but if you really care, put something forward. Stand loud and proud behind your idea to do nothing. Or to drop the capital gains tax or whatever.
Actually - Most economists have been warning about the economy for a while now, but the wingnuts chose to ignore them.
But I think Ann's right. It's kind of how I feel about law professors when they try to tell us about the law and the constitution. I'm sorry - but why the hell should we listen to them? What the hell do they know? I am just as much of an expert on the Constitution and the Law as any law professor or Supreme Court Justice.
The only thing worse than pretending to not have an opinion about something as important as the bailout is actually not having one.
By definition the stimulus package is a short term fix.
I reject the premise. We don't need any more short term fixes.
Remember when Cheney claimed that "Deficits don't matter"?
Welcome to Cheneyland.
After all that I forgot to put in my two cents: the stimulus will seem to work at first - for a while. But because it doesn't address the core problem of credit-based addiction to cheap consumer goods made overseas, and cheap illegal labor imported from Mexico, it will solve nothing in the long run. Besides, what if China can't or won't underwrite this stunt? Then it's really all academic.
"But I think Ann's right. It's kind of how I feel about law professors when they try to tell us about the law and the constitution. I'm sorry - but why the hell should we listen to them? What the hell do they know? I am just as much of an expert on the Constitution and the Law as any law professor or Supreme Court Justice."
Yes because economics is so analogous to Constitutional law. If you knew anything about economics, which you show daily you don't, you would know that economists have been completely taken aback by events any number of times in the last 100 years. Economists of the day could not adaquately explain the Great Depression. Indeed, if it ever was explained it wasn't done so until Friedman's work in the early 1960s. Economists were equally bewidlered by stagflation in the 1970s. By the late 1980s Paul Krugman, you might have heard of him he actually did real economic work before he stopped taking his meds and started writing for some OPEd Paper, described the state of knowledge of macro economists as quivilent to that of doctors in the early 19th century in that they had figured out how not to do things that made the patient worse but still had no idea how to cure them.
Economists are no better today. They have no idea how to escape the business cycle and can only offer rudementary policy advice such as "don't borrow yourself to oblivian" or "bad things happen when governments expropriate property and stop respecting property rights" or "devaluing your currency and causing hyper inflation is really bad". Beyond that, they simply don't know anyone who claims that they do is either a liar or a fool.
When someone like you claims that "economists should be listened to", you are just saying that you saw someone with a PHD who said something you agree with.
This has been a long and cold winter.Not just in WI., but the upper half of the country. There will be a lot of people going back to work when the frost is out of the ground, and people will be working on the roads, bridges and a lot of other construction projects, just like they do every year. Machinery will wear out and other machinery will be purchased.
This Nov.-Dec., when winter once again sets in, they will be laid off once more.
The CBO overview of Porky titled **giggle** American Recovery and Reinvestment Act of 2009 **snort**, that should be called The Greatest Transfer of Wealth the World Has Ever Seen.
It appears to have little to do with the much hyped infratructure rebuilding and job creation and more to do with Business As Usual Only Bigger and Better Boondoggeling.
Under Div A Title Xlll there is something new called the State Fiscal Stablization Fund that provides grants-in-aid to states that would total to $79 billion by 2013.
Why is federal money being transferred to states that cannot manage to balance their own budgets? It seems to me that this would make them only more irresponsible, sloppy and inefficient.
STATE BUDGET TROUBLES WORSEN
States are facing a great fiscal crisis. At least 46 states faced or are facing shortfalls in their budgets for this and/or next year, and severe fiscal problems are highly likely to continue into the following year as well. Combined budget gaps for the remainder of this fiscal year and state fiscal years 2010 and 2011 are estimated to total more than $350 billion.
Not that it will do much good, but I've contacted my senators telling them to vote 'no'.
atha...atha....That's All Folks.
Ann,
Late to the thread, but:
Bing-freakin-O...
downtownlad -- just keep repeating "deficits don't matter, deficits don't matter."
It may stick in the craw at first.
I'm still hoping for the best.
I'm still hoping for the best.
I'm still hoping for the best.
but if you really care, put something forward.
OK...again.
Eliminate "mark to market" rules. This would free up tons of lending because it has artificially dropped the cash reserve/lending ratio of banks.
Lower tax brackets across the board and keep them low for an extended period of time so that people, and especially the small business owner can plan.
Lower capital gains temporarily to a flat 10%. Again would free up a lot of cash because...believe it or not....there are considerable earned but not realized capital gains sitting on the side lines.
Lower corporate taxes to a level similar to that of Ireland and business will be booming. Instead of outsourcing industry, we will be able to grow industry.
Screw global warming. All those restrictions are meant to kill jobs and industry and will only drive growth to undeveloped countries who don't give a rip about being Green. They give a rip about eating, growing jobs and getting wealthy. While we sit here in a eco-nazi circle jerk, banning "after market" car parts, crippling businesses and making the cost of everyday good expensive the people in India, China, Africa and Russia are laughing their asses of at us.
Immediately cease the sub prime lending that is one of the tipping points that got us into this slide. The socialists haven't learned their lesson and STILL want to expand loans to people who don't have the 3 'C's of lending. Credit, Character and Collateral. Do not reward Banks for making bad loans and STOP forcing Banks to make bad loans.
Lastly. Don't cram unionization down the throats of the business community and down the throats of the workers with this evil "card check" legislation. Unionization, while a good thing in its time, is what has killed industry. Look at GM, Ford and the steel industry. The socialists now in power have their sights set on unionizing retail (WalMart). This will result in huge job losses as WalMart, wisely, closes stores and in higher cost of goods to pay for the expensive benefit packages and wages of unionized sales clerks.
There.
DTL: "It's kind of how I feel about law professors when they try to tell us about the law and the constitution. I'm sorry - but why the hell should we listen to them? What the hell do they know? "
My law posts are often about trying to help laypersons see how judges and lawprofs are using expertise to exclude you. But we actually do know more than you too. You need to learn how to navigate in that environment, and I am trying to help. You have to decide whether to trust me, a human being.
Yes because economics is so analogous to Constitutional law. If you knew anything about economics, which you show daily you don't, you would know that economists have been completely taken aback by events any number of times in the last 100 years. Economists of the day could not adaquately explain the Great Depression. Indeed, if it ever was explained it wasn't done so until Friedman's work in the early 1960s. Economists were equally bewidlered by stagflation in the 1970s. By the late 1980s Paul Krugman, you might have heard of him he actually did real economic work before he stopped taking his meds and started writing for some OPEd Paper, described the state of knowledge of macro economists as quivilent to that of doctors in the early 19th century in that they had figured out how not to do things that made the patient worse but still had no idea how to cure them.
Actually - I studied Quantitiative Economics for my major, so I actually DO not what I'm talking about.
Unlike you - who gets his talking points from high-school dropout Rush Limbaugh.
So please - shut the fuck up when you don't know what you're talking about.
"Economists of the Day could not immediately explain the Depression" you said. Yes - you're a moron. Because you never heard of Keynes who published "The General Theory of Employment, History, and Money" in 1936. Keynes, of course, got a big head start on studying the Depression, as England's depression happened about a decade before ours.
"You then say that economists were equally bewildered by stagflation in the 1970's." No they weren't. Because Milton Friedman predicted it in the 1960's when he wrote about "monetarism".
Really - you're a moron on this subject. Just shut up.
And since you are a complete moron - my comment about the law was called "sarcasm". Look it up - because you obviously don't know what it means. I certainly don't think I know more about Law than a law professor, and I defer to them when they correct me.
Ann - in my last paragraph I'm calling John a moron. Not you.
Although you should have known I was being sarcastic!!!
This is what bugs me about the whole economic debate on the right. It is anti-intellectual.
Keynes was a remarkable economist who did more to advance the science than any other person in the 20th century. (And he was gay to boot).
Milton Friedman, who discovered Monetarism, did not say that Keynes was wrong. He evolved Keynes' models. Which is a good thing - it moved human knowledge forward.
Very similar to how Einstein evolved Newton's models on gravity. They don't work at the subatomic level.
Milton Friedman wrote about the expected rate of inflation, and how Keynesian models won't work if people expect inflation to be higher because of the government increasing the money supply, etc. And they added more variables to Keynes' equations. He did not chuck them out the window. He enhanced them.
But we've had tax cuts galore over the last 8 years. And the economy is entering a Depression. The monetarist model has broken down BADLY. What went wrong?
An intellectual will say "hmmm. that's interesting. we should study this and evolve the model".
Wingnuts just put their heads in the ground and say "More tax cuts please!".
[Joe Gideon lies on a hospital bed surrounded by medical personnel and well-wishers.]
CARDIOLOGIST: All right, who's in charge of this all-important show that Mr. Gideon keeps talking about?
PRODUCER: I guess I am.
CARIOLOGIST: Mr. Gideon is having attacks of angina that could lead to a massive coronary.
JOE GIDEON: Oh, shit! I gotta get to rehearsals. I'm fine. What do doctors know?
CARIOLOGIST: About angina? A little more than show people.
-- All That Jazz (1979)
The 'intellectual' economic debaters of the left:
Nancy Pelosi, Harry Reid, Chris Dodd, Barney Frank, Barack Obama.
Meet your masters of disaster.
The 'stimulus bill' ain't.
Yep. I'm feeling the same way,
I was watching Meet the Press and Senator Ensign-who is not known for exaggeration stated that they the minority only received the bill Saturday night-so just two days ago.
The Democrats are about to pass a bill of historic proportion and this "crisis" has been building for awhile.
In the interest of fairness can't they take just three weeks to allow the peasants who are paying the bill to see the itemization.
I'd like them to give everyone a chance a access to it-and print and publicize it..
Isn't this bill getting close to ILLEGAL?
Does anybody here remember -
PAYGO?
That's the idea that to enhance the very legitimacy of government-when you are doing a bill at the same time -the government has to explain how they are going to make US pay for it.
{ I actually think they might be able to stop or slow down this bill via PAYGO-or the Byrd law-for that you don' t need as many votes. Just to give the public more time to get look at this thing.}
An integral player might be
Susan Collins of Maine.
Her office in Washington is getting slammed but try calling her office in Caribou, Maine.
(207) 493-7873
"Trust us, hurry up, your instincts are irrelevant because you're not an expert, stand aside, shut up, obey."
You forgot to add the global warming tag.
I do appreciate the lay-person’s explanations, here for law, and elsewhere for economics – I do, because I cannot be an expert in everything. As I said above, I’ll let the ‘experts’ debate – as it appears, no one really knows for sure – not so much based on conjecture, as on opinion. And opinions are fine – they are what they are. For me, make your case without emotion, without condescension and you have a better chance of getting through.
Yes Keynes was a remarkable economist. It should also be noted that Keynes never thought that government should be more than 25% of the economy and concluded in later years that infrastructure spending was not the best way to stimulate the economy.
If you want to talk Keynes lad, fine lets talk Keynes. Suppose we are in a liquidity trap? How big of one are we in? Does it really require the two or three trillion dollars that we are spending? Further, even if it does, why then isn't the spending temorary rather than a one time jolt? It is called pump priming not pump replacement.
This bill is not Keynesian. It is just a national theft bill. If anyone is being "anti-intellectual" it is the people on the Left who throw out and misuse the names of famous people they once heard about in college to justify bad policies.
Adopting mantra:
I'm still hoping for the best.
(And may I say that I find Mickey Kaus adorable? He always looks sort of crabby in a way...or like he's trying hard to be crabby, but not pulling it off. Cute.)
downtownlad wrote: 'An intellectual will say "hmmm. that's interesting. we should study this and evolve the model".'
It seems to me that the intellectuals that support this stimulus package are saying "hmmm. that's interesting. Let's chop 800 BILLION DOLLARS into confetti and call it a party."
How did the model work for Bush? Bush offered tax cuts and huge spending increases. How can anyone who thinks Bush screwed up support this bill? It is exactly the same model.
You can argue that the details are different, but even the bill's supporters have given up on the pretense that the bill is targeted to stimulus. It's an omnibus spending bill that is now defended on the principle that the spending goes to "worthy" programs.
Even the Washington Post has a bad feeling about it-
Bill's Pace Could Leave Billions Wasted
Henry -
Add to that that the Democrats held the Congress-which is in control of the purse strings for the last two years.
The last Republican Congress the 109th in 2005 tried to pass a Deficit Reduction Act which the Democrat minority fought by calling it unconstitutional and took it to the courts.
I see that you're arguing with the one gone vanished, the one with the spirit so dark as to force himself to resolutely stupid, the one stuck on the word wingnut.
Has he managed to explain to you the role of sub-prime lending in setting off this spiral, and banking laws demanded by a liberal congress that might as well have well been lifted straight from the pages of an Ayn Rand novel? No? I don't so. Although I can not see him on my screen I know it to be against his nature for anything other than single-purpose straight up projection of blame where it doesn't belong and to elevate his own sense of self-worth at the expense of everyone in sight. The self esteem issues on display, for you, blank spaces for me, are the work of psychiatrists.
What kills me are the commenters that have no clue at all about economic matters and say so, but nonetheless hasten to add they do know something must be done, meaning anything. Not here of course, you're all knowledgeable and charming. Fine. The election was theirs. Very well then, get to redistributing and give me some money. NOW! I've got an eye on two new lenses, an ultrawide and a macro, and they're both expensive.
Infastructure is not the best way to stimulate the economy?
Yo - maybe you ought to take a look at the Stimulus Bill. There's hardly any infrastructure spending in it - about $30 billion.
Lots of the spending is on things like unemployment and food stamps, etc. Which Keynes would agree has a much higher multiplier effect that infrastructure - and gets into the economy much more quickly - and helps those who are suffering the most from the effects of the Depression.
You're comment on temporary vs. a "one-time jolt" doesn't make sense. The bill is temporary.
And 42% of the bill is tax cuts. That can hardly be called "theft".
As for the liquidity trap - if you want to take a look at it, I suggest you check out the Ted spread, which is a good measure of liquidity.
http://www.calculatedriskblog.com/2009/01/credit-crisis-indicators.html
It will take a while for this to trickle into the economy, but we should see improvements in 6 months. The stimulus package will help increase confidence as well, and WILL add some stimulus to the economy as well.
I don't like government spending. Especially when the economy is at full-employment and it is crowding out private sector spending. But I'll make exceptions when the economy is heading off a cliff, banks are not lending, and the private sector is nowhere to be seen. I really have no interest in living through Great Depression 2.0 just to make an ideological point.
How nice of Chip Ahoy "I hate gay people and will never associate with them" to show up and try to comment about economics.
So, 30 billion dollars is hardly any money, eh? You must work for the government, or else you are channelling the spirit of Everett Dirksen.
I like gay people, especially if both the chicks are hot.
downtownlad-
I don't know ow you are claiming to know what is in the bill as it stands now-when Senator Ensign-who is a member of The Committee on the Budget-says that he just received the bill this last Saturday night.
I didn't dump all my gay friends either, I simply chose not to comport with anybody unlovely. Got that, Stupid? I have no reason to put myself in the presence of undelightful people. I don't allow it. Having made that decision, nearly all my gay friends have dismissed themselves and my social circle had diminished considerably, and I'm altogether better off because of it. - Chip Ahoy
My gay friends were friends precisely because they were lovely people. Were lovely people. But since Bush's elections they have, to a person, indulged open, emotional, often irrational hostility. They've pissed on every single gathering without exception, including funerals, and completely undone my desire to comport.-Chip Ahoy
Chip Ahoy has himself a stalker.
It's tax cuts and spending in the bill.
They idea is to increase "G" in the economic equation - which moves the demand curve out. The specifics are really not the most important thing at this point. It's the size of "G". While I have my own preferences on where the government should spend money - that's really up to Congress to debate - and nobody will be 100% happy. It's the government - don't expect it to be perfect.
No Greg - I have a fabulous memory. And I never forget a bigot.
downtownlad -- the alternative stimulus bills mostly focus on safety net spending (unemployment, for example) and payroll tax cuts -- and come in at half the price of the majority bill. What the majority bill lards on is huge grants to existing programs that are not germaine to the problem.
Why aren't you backing one of the alternative bills?
As you say, the TARP program is starting to work and Obama's banking team has very good people on it.
If liquidity is starting to trickle into the economy, why the rush to pass this bill?
* * *
As far as Keynes goes, no one really knows the actual multipliers for taxes or spending. There is no control group for the 20th century and every study is riddled with assumptions. Macroeconomics is about as good with long-term specifics as weather forecasting.
And let's not forget. Wingnuts like Chip Ahoy supported the economic policies that got us to where we are today. They created this Depression. They are responsible for it.
Now the reality based community needs to fix it.
Now the reality based community needs to fix it.
Then why are you doubling down on the same deficit-spending policies?
Chip Ahoy's statement is not bigoted at all. He has every right to be disappointed in his friends. It doesn't make him a bigot. He never made a blanket statement about gays. That's a vile thing to say.
We have a $2.7 trillion output gap. $800 billion is piddly compared to that.
Granted - money supply has been growing at 20%, so that will help somewhat too.
We are in danger of going into a deflationary spiral. I'm not too worried about government spending causing inflation - inflation would be good at this point.
$800 billion over 3 years is less than 2% of GDP. Since the economy is shrinking at about 5% a year, that hardly seems excessive.
I'd err on the larger side of a stimulus bill. The Fed funds rate is at zero, so there is no ammunition on the monetary policy side (except printing money). Government is the only ammunition we have left at this point.
Think about it - let's suppose our debt as a percentage of gdp if 40%. Let's say that we go with a small stimulus bill that brings it up to 43%. But if it doesn't work and the economy shrinks and we start to have deflation, suddenly that 43% turns to 60%, even if we don't have more spending, because our GDP is much smaller.
Now let's say that we go with a larger stimulus bill htat brings the debt to 46% of GDP (twice the Republican one). And it works, but it causes excessive inflation. Well then you have a growing economy PLUS inflation, and your debt as a percentage of GDP will actually shrink - back to 40% or so.
I'd rather have the latter - even though inflation would cause other negative effects.
Actually he's not-willing to double down on these policies.
Just a few days go DTL was bragging about how he is now investing in China.
So no- even DTL isn't willing to "bet" on Obama.
My Christian friends were friends precisely because they were lovely people. Were lovely people. But since Obama's elections they have, to a person, indulged open, emotional, often irrational hostility. They've pissed on every single gathering without exception, including funerals, and completely undone my desire to comport. - Downtown Lad
China got its stimulus program implemented already. Look at their stock market year to date.
http://finance.yahoo.com/echarts?s=000001.SS#chart1:symbol=000001.ss;range=ytd;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined
I'm already invested in the US. I am not willing to double down. I am not convinced that Obama can outsmart the Republicans.
I think the US is due for a very slow, plodding recovery over the next decade - Japan style.
That's also why I still live abroad.
What kind of real jobs and sustainable industry does this bill create in the immediate future?
Ow are you going to convince investors to invest when you've got the Democrat policies coming down the pike-of
Taxation, regulation, increased unionization and litigation for businesses?
Those policies and theoretical "business" practices of the Democratic party aren't going to help with companies' profit margins.
How you think an entity full of more Obama created bureaucratic layers-like the federal government located in Washington DC can efficiently spend this amount of money is beyond me.
DTL-
Well holy crap we agree on something-
I think we are due for the Japanese style slog too but for the above stated reasons.
You know the Japanese threw money at their problem for years.
I think the US is due for a very slow, plodding recovery over the next decade - Japan style.
Never mind that Japan tried a massive stimulus bill just like the one Obama wants to get passed.
That's also why I still live abroad.
I thought it was because you can't get married here in the 4th Reich?
I also never fawned over Obama. I'll criticize him if he messes up. It's only been 3 weeks and it is WAY too early to start judging if he is a success or not. It took me a few years before I started giving up on Bush. But I don't see any Republicans in the wings that I could support. Although Meg Whitman of Ebay "could" be promising - I'd have to see if she believes in equality for gay people first.
I like Geithner and I'm looking forward to the unveiling of his plan tomorrow.
"Deficits don't matter."
Funny how bad becomes good in the Obama administration.
No - the Japanese waited way too long before acting. And they have still not tackled the underlying banking problems. They ignored them. We are way ahead of them on that front.
They waited years before doing a stimulus plan, and they were already in a deflationary spiral by then. And the stimulus started slow. It's better to have a large stimulus plan to shock the system.
Their stimulus plan was also too focused on infrastrucure - building roads to nowhere, huge sporting complexes in towns of 20,000 people, etc. Obama has learned from those mistakes, and if you look at the rationale behind various initiatives - most of it is based on what has worked well - trying to learn from past mistakes, etc.
The US is in danger of making the same, incremental mistakes by trying to please everyone. If that happens - I'll blame Obama. He's in charge.
DTL-
China-they're invested in our treasuries though and their economy is I think less than 40% self sustained.
Over 60% of their GDP is reliant on foreign consumption.
How is what Geitner is doing with the mark to market strategy for banks not just an accounting trick?
Somehow I have a hard time listening to DTL, when he has made it clear he hates the US, hates the people in the US, and as a result moved out of the US.
What's more, he is speaking with authority on a bill that most of those voting on it admit they themselves have not had time to read yet. But DTL has access.
DTL, you got even angrier after Bush left. I'd say 'you won', but you left. Anyway, I don't get it.
Not that I care to.
"Actually - I studied Quantitiative Economics for my major, so I actually DO not what I'm talking about."
As Gladys says, "I'm sure that means something."
Sixty-seven percent of the American people approve of how President Obama's handling his efforts to pass an economic stimulus bill, as opposed to 48% for Democrats in Congress and 31% for congressional Republicans.
In addition, the disapproval rating for Congressional Republicans remains a "staggeringly high" 58%.
Well I guess they have Japan as a template-still I hope they wouldn't use it too much because many variables of their economy and culture are not like ours.
Maybe it's the closest thing-but I don't feel like throwing money at an experiment when the Democrat leader Obama doesn't trust the electorate to read the bill-itemized-that they have to pay.
[We know Daschle, Geitner and a host of others have managed not to.]
Obama's car salesman style of -
Sign here NOW-I can't do this deal for you tomorrow-has America's common sense coming up in hackles.
I don't really trust the people involved, but this explanation makes a lot of sense when you think about it.
Say, if anyone wants to actually do something write your favorite major bloggers and suggest they tell their readers to get off the couch and go ask politicians questions about this scheme. The responses can then be uploaded to Youtube.
Take a close look at the coverage offered by the major bloggers you read: are they suggesting things you can actually do to block the scheme, or are they just putting on a show? Write them and suggest they consider doing something for a change.
Here's a general guide to asking real questions.
If someone can come up with some good starting points I'm willing to edit them for maximum effectiveness.
Sixty-seven percent of the American people approve of how President Obama's handling his efforts to pass an economic stimulus bill, as opposed to 48% for Democrats in Congress and 31% for congressional Republicans.
In addition, the disapproval rating for Congressional Republicans remains a "staggeringly high" 58%.
Unsurprisingly 100% of commenters here still think Michael is an asshole.
We have been kicking the social security can down the road for years now right?
What difference would it make if we do it for a few more years?
So my advice is to eliminate FICA taxes for two years! That would pump more than a $1 Billion back into consumers' hands.
DTL:
You spelled quantitative incorrectly!
The problem I see with DTL, etc's arguments is that they are always in the abstract, and not the specific, directly related to the proposed "stimulus" bill.
The problem is that the bill fails for a number of reasons. First, there is the problem that infrastructure and construction spending spread out over the next decade is invariably going to be counter-cyclical. But when attacked, a lot point at precisely those elements as essentially. Not only are they counter-cyclical, but since their lead time is in years, and not days, I haven't seen plausible reasons why they need to be authorized RIGHT NOW, instead of through the normal appropriations process.
A lot of the immediate money goes to pay off constituent groups, like the teachers' unions. The primary argument seems to be that we need to get money into the economy right now. But why spend it the way it is being spent? Why not some alternatives, such as just cutting checks to everyone?
I see the whole argument in favor of the package somewhat of a shell game. Infrastructure and construction are highlighted as essential Keynsian spending and good investments for our future, but that ignores the timing. At least that money would be going into people's pockets and much would presumably be spent on stuff that would benefit us. On the other hand, the immediate spending appears extraordinarily wasteful, unproductive, and hard to defend, except at the broadest levels, as Pelosi has attempted to do (to much ridicule).
More importantly, the stimulus bill operates on the assumption that the multiplier effect is greater than one, which has not been shown to be true, as Barro discussed.
the TARP program is starting to work
There isn't a spec of evidence for that. All indications are that's it's been a total failure and the better option would have been to do nothing. The best option is still what DBQ, myself and others have been arguing for years--if you want true economic growth and not growth by bubble, letting businesses prosper is the only way to go.
Did anyone else do the math re Obama's speech today in Elkhart Ind?
He proffered $100 extra in unemployment benefits (I didn't catch if that was weekly or monthly), a one-time $1000 tax rebate and undefined "help" with paying for COBRA and job re-training assistance.
That is either $1200 for a $100 per month unemployment benefit increase or $4800 for a $100 per week increase for a 12 month period for net take home increase (over and above state unemployment benefits) of either $2200 or $5800 including the $1000 tax rebate.
COBRA coverage costs quadruple a group monthly benefit. Perhaps enrolling these folks in Medicaid until they find work would be a more cost efficient use of taxpayer dollars? Those who do not find work will eventually end up on Medicaid anyway.
Road and school repairs/building are not general hire jobs, they are performed by contractors, skilled jobs are unionized, and require bidding. While it would put many in the housing industry back to work, it would do little for laid off RV assembly line workers. Unskilled construction jobs are very low paying and are mainly done by illegal immigrant labor.
Unless new industry is built in Elkhart retraining will not be of much assistance, especially for middle aged workers who are much less likely to find comparable work/wages.
Obama was in fine campaign fettle today, but as he pointed out; he won, now it is about governing, not rhetoric. Obama made a grievous error in trusting Pelosi and Reid to write the bill without preconditions and/or an outline.
One hopes Obama learned from the stimulus kerfuffle and will crack the WH whip on Congressional Dems, they are his worst problem at the moment as their excesses are giving a marginalized GOP resonating issues and power. Reid needs to go and Pelosi put on a very short Rahm Emmanuel leash.
Otherwise Obama risks a mid-term meltdown, especially if towns like Elkhart have not seen some fiscal improvement by 2010.
He proffered $100 extra in unemployment benefits (I didn't catch if that was weekly or monthly),....
Monthly
I just wanted to say that I think we'll be seeing the following phrase a lot in the upcoming months and years:
"I also never fawned over Obama."
Is Althouse live blogging the press conference this evening?
The vetting continues...
Bloomberg LP v. Board of Governors of the Federal Reserve System, 08-CV-9595, U.S. District Court, Southern District of New York (Manhattan)
Bloomberg requested details of Fed lending under the Freedom of Information Act and filed a federal lawsuit against the central bank Nov. 7 seeking to force disclosure of borrower banks and their collateral. Arguments in the suit may be heard as soon as this month, according to the court docket. Bloomberg asked the Treasury in an FOIA request Jan. 28 for a detailed list of the securities it planned to guarantee for Citigroup and Bank of America. Bloomberg hasn’t received a response to the request.
Most of the funds were doled out of the Federal Reserve Bank of New York President under former President Geithner's oversight.
"Is Althouse live blogging the press conference this evening?"
Absolutely!
While it would put many in the housing industry back to work, it would do little for laid off RV assembly line workers.
The real irony of it is Obama is using laid off RV workers to elicit sympathy for his stimulus plan. Yet during his campaign we were being admonished for driving our SUVs around with no regard to the environment, soaring gas prices and sending hundreds of billions to our enemies.
What's the MPG on a house on wheels?
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