Now, about the economy.
 

Everybody knows you spend during a recession/depression.

Every economist worth his salt has been saying ad infinitum, with nary an ear listening, that if anything the stimulus was too tepid to deal with the enormity of the collapse Bush presided over.

And since last November, we've done nothing but wail and gnash our teeth about spending too much.

The issue has not been liquidity for quite some time. The issue is demand. That means money in average people's pockets so they can buy stuff.

And of course, the issue of believing in our own futures, so we dare to spend whatever we have -- at the "discretionary" end, where people would be spending as a choice (as opposed to the poor and middle class, who just need something to spend on what use to be the "necessities.")

So what's the jobs plan?

Obviously, we've tanked things a bit more by squabbling over the so-called debt crisis... yesterday's downgrade was more a judgment on our politics than our fiscal position.

So come on board, teabaggers et al., and talk to me about creating jobs.

Infrastructure investment anybody? Or do you still believe Warren Buffet and Ray Dalio need more tax breaks?

PFnV

Re: Now, about the economy.
 

Well we have spent at a record pace and it has been an abject failure. Think of a different approach. As Einstein said "Insanity is doing the same thing, over and over again, but expecting different results."


Doing the thing 'everybody' knows we should do, that doesn't work, is insane.

Re: Now, about the economy.
 

It's not a bad idea, and we can make it part of the revenue stream as well. If you don't take a penny from a program, add a penny to a tax bracket. After all, the premise of the solution is, "It's only a penny." Who's going to argue over a penny?

Re: Now, about the economy.
 

Close 75% of our foreign military bases and bring our troops home to work on our infrastructure. We can use (and pay) our troops to re-build roads, bridges and fresh water infrastructure for a decade and save billions vs. paying to sustain bases in foreign nations.

Convert swords into shovels....just a thought.

Re: Now, about the economy.
 

Beat the swords into plowshares...

Re: Now, about the economy.
 

"For this tired old man we elected king..." End of the Innocence by Don Henly

Super great song!

Yeah, I was thinking the same thing, but right now, "Plowshares" doesn't make any sense, so I opted for "shovels".

Re: Now, about the economy.
 

My Goodness... Do nothing... The Market needs a contraction, No spending, no central planning, let people work their way out of this.

Fake Job Creation simply passes the buck down the road... Stop printing money, stop spending worthlessly.

You know if they took QE1 and QE2 and simply distributed it to the people, we would have all gotten $7,000 EACH!!! For every infant, poor person, rich person, etc...

Quantitative easing - Wikipedia, the free encyclopedia ( QE1 and QE2 2.1 Trillion divided by 300,000,000 = 7,000 )

That money would have sloshed through to the mortgage companies and banks to actually PAY Down the public debt burden.

Instead the geniuses distributed that money directly to banks, leaving the people with less purchasing power, and the same debt... The People took on more debt as a country and recieved NOTHING IN RETURN.

Now you big gov hawks want the government to stand up and print more, becuase 2,100,000,000,000 wasn't enough???

... We all now know why we have arrived at this point ...

Re: Now, about the economy.
 

So what is your opinion on Japan over the last 20+ years regarding stimulus speding? Those who say "they haven't spent enough" don't understand economics because as a percent of their GDP, no nation has ever spent as much on stimulus' in post WWI history.

What has it done for Japan?

Unless you support the US defaulting on our debt, the risks of MASSIVE stimulus spending is no future for generations to come.

Also, we nee to keep in mind that our economy needs to reset all the mechanisms that are out of balance. Real estate needs to find it's natural bottom. If we artificially inflate our economy so that real estate prices actually increase again, then we'll just set ourselves up for another crash.

I don't know if we'll ever see 4% unemployment (full employment) in our lifetime. I know that sounds dark, but that may be our new reality. But that doesn't mean our gov't should pick up the slack and employ more people...unless we can find a way to fund it without increasing taxes on the middle class.

Re: Now, about the economy.
 

Compared with what?

The historically accurate way to phrase this is more complex. We spent at a record pace cutting taxes when unemployment was half the current rate. We borrowed the money to spend on unsustainable tax cuts. Then we got into a situation where we really did need a stimulus.

Now then: the spending before the collapse was an abject failure, because it was unnecessary spending.

The spending since the collapse, to the extent that it actually was stimulative, had a purpose.

Compared with "what if", which is the only fair way to parse the "abject failure" absurdity, economists say that surprise surprise, it was a resounding success.

But it's very hard to say "Look at my successful 9.1% unemployment rate!" It only matters if you compare it with 15% or 25%.

You're right. Think of a different approach. Cutting taxes and keeping them low, at all times, on all levels of society, is wrong, self-destructive behavior that will never pay our bills. It is, as S&P so pointedly mentioned in our recent credit downgrade, unsustainable behavior.

Think of another approach. Work with me. Let's raise revenues. How?

What's insane is that you should know (and I think you do know,) I know, and every economist worth talking to knows, that you have two choices, unless you are going to raise taxes:

You tackle debt
You have a jobs program.

One or the other. This is what I mean about "something for nothing" on the right wing. This magical thinking that the economy is going to grow without any demand is insane. You can't cut your way to paying your past bills. So revenue doesn't magically increase just because you've let the monopoly guy buy a new monacle, and put another tranche of tax giveaway money into an offshore corporation. The monopoly guy sees no demand in the U.S. Even if he does see it, he'll address it as cheaply as possible, i.e., through offshore labor where possible. But that's another whole argument.

There's a lot you do to fight a depression, which thanks to your teabagger buddies, we might be looking at as the next phase. Maybe, maybe not. A double dip is right back in the mainstream of outcomes now, whereas it was receding into the distance by the end of '10 (unless you counted the likelihood that the unlettered twits of the extreme right would succeed in their perhaps well-intended treason.)

Now: insisting that we tackle debt is their way of attacking the role of government, full stop.

It has nothing to do with the debt.

The debt can be analyzed very easily: We owe a bunch of money. We can all get together and pay it. That would be a 100% revenue approach.

You can't cut something in the future to pay the bills of the past.

But you can redirect ALL your spending to pay your past debt. That's the 100% "spending cut" approach.

Frankly, at present, since (as opposed to prior to the collapse of 2-8, and the preceding recession starting in 2-7) we actually need money in pockets, we actually need jobs programs, etc., this is precisely the wrong time to go for a 100% spending cuts approach.

We were on the debt warning track, but nowhere near downgrade territory, before Norquist's puppets became a fifth column attempting to destroy America from within -- and actually showed that the minority can, in fact, make national policy. Now? We've shown through their insistence on unsustainable and unrealistic fiscal "policy" that they believe in magic, not math, a viewpoint I am sure you're about to jump to the defense of.

The magic of the markets doesn't work if nobody's buying. Nobody's going to be buying if everybody's broke. Anything.

The right has made debt its be-all end-all, in a bid to dismantle the great society and new deal programs, hallmarks of a century of much-needed (and to the right, much-lamented) progress. We're now treated to the spectacle of ayn rand study group types thinking that each individual should be responsible for his own meat inspection, road maintenance, etc. It don't work like that. We have a nation-state for a reason, and it does work on the public behalf for a reason.

We tried feudalism too, didn't work.

So climb down off the cliche wagon and talk reality. A 100% cuts routine will do nothing but set this country back decades. What it will manifestly not do is lead to a healthy economy.

"Supply side economics" has been discredited for decades. "The laffer curve" is only remembered because it was so aptly named.

Jobs or debt reduction?

There is one way to make progress on both: taxation.

Pay now, or pay later.

You can't get something for nothing. Stop with the magical thinking and get real.

PFnV

Re: Now, about the economy.
 

False, less government funding leads to less taxes, and more money and power held by the people to invest in the things we like best leaving the market to coordinate time and interest at it's most efficient route.

But if you think Central Planning is the best route, to each their own.


Also, for full disclosure, your livelihood is based on the market am I correct? If so, I don't think your ever going to argue or accept anything that doesn't equate to an artificial bubble am I also correct?