See the cite in the OP.
Regards.
Shodan
Put out the fire, and then worry about wastng water. It is not an ideal solution, the ideal solution is not to have the Big Shitpile ablaze in the first place, File Not Found, Access Denied. Ex-Parrot.
Will we waste money? Probably, bordering on certainly. Do we have the time to carefully parse every nickel of expense? Nope.
The Days of Wine and Roses are almost certainly over. But that does not necessarily mean an abjectly impoverished America, it probably doesn’t. What it does mean is an America that does not squander resources on loud, shiny crap.
Yes, but think about that. Obama is saying the stimulus package is so crucial that without it the economy might never recover. But with it, the economy will be so strong that in the very next budget after the money is spent the government can afford to raise taxes and start paying down the deficit?
If this is indeed a short recession, then it was a typical ‘business cycle’ recession, which usually lasts 16-18 months, and for which we wouldn’t have needed a stimulus. If, on the other hand, it’s a ‘balance sheet’ recession which most economists think it is (and I agree), it’s going to last a hell of a lot longer than that. In which case Obama would be an idiot to raise taxes on business and investment.
Or look at it this way - even among economists who support a stimulus, I doubt if any would support a stimulus followed by an immediate hike in taxes while the country was still deep in recession. In fact, economists like Krugman, who is the cheerleader-in-chief for the stimulus package, think that Roosevelt’s stimulus was working and that he made a big mistake by raising taxes in 1937 - Five years after he first started ‘stimulating’ the economy. So I can’t imagine they’d support a tax hike two years into this one while the current stimulus is still making its way into the economy.
I’d like to see a projection of the deficit under the assumption that the economy will NOT recover, and that government revenues will be lower in 2 years than they are today. That would be more honest.
Give it a rest. Most of that deficit is from TARP. Bush’s pre TARP deficit was somewhere around 450 billion. And Obama has almost tripled Bush’s deficit in under 5 weeks!
That is not at all typical. The longest downturn we’ve had since the war was 16 months, and they’ve averaged 10 months since 1945. That’s the NBER’s word for it, and according to them, this one has already lasted more than a year. We’re clearly going to break the postwar record, and then some.
FDR took office in March of 1933. The tax increases and spending cuts that caused the 1937-8 downturn were started in 1936, with FICA payroll taxes beginning in 37. That’s about three and a half or four years of moderate stimulus, not five, for the biggest economic downturn in our history. There’s a reason we call it the Great Depression. Today, we’re under a similar sort of deflationary pressure, but it’s not that bad yet, and we’re taking active measures only a year and change into the problem instead of having to wait three long years doing nothing under a Hooverish president before implementing expansionary policy.
Of course, moving to tax increases and spending cuts in two years might still be too soon. It’s certainly within reason to worry that Obama will repeat FDR’s mistakes and push for too much fiscal contraction too soon. That’s a solid Keynesian criticism. Even so, the Obama administration’s political rhetoric is at least consistent both with their legislated window of stimulus spending and their own projections of recovery (with the stimulus included in those calculations) They are following their own figures, even if the more liberal economists suggest stronger action.
If this rhetoric actually does lead to contractionary policy too quickly or too overwhelmingly, then we’ll be sure to note that in two years time. Until then, we can sit tight and see how it plays. Obama originally planned to raise those taxes earlier, at the beginning of his administration instead of waiting for them to expire naturally. He’s shown that he’s capable of changing his mind in face of changing circumstances, and we’ve got two years of potential changes to go through before his current plans become actualized.
I was referring to the line immediately following your original post by Sam Stone, which was a totally predictable “anything from a recession to receding gumlines can be cured by tax breaks” line of shit.
-Joe
Please quote the line from my message which says anything like that.
Is the rumor that the house has proposed another 410 billion dollar spending bill this week true? That wouldn’t help much with slashing the deficit.
Yup…and Stimulus 2 is right around the corner. And probably another Detroit bailout. And who knows what else we will end up paying for. Don’t worry though…Obama doesn’t really intend to slash the budget. It’s just what you want to hear and, since few people really know what the deficit is, and even fewer in the major media outlets will hold him to his promises, we will all probably forget about that remark in a few months
I watched his speech last night (I didn’t see a thread on it in GD which I thought was interesting…though I might have missed it), and honestly…I don’t know what he is going to do. Yeah, he plans to raise taxes on the ‘top 2%’ of American’s…but he’s planning a tax CUT to ‘95% of tax payers’ (both quotes are from my memory of his speech so may not be 100% accurate…if anyone wants to look it up feel free to put in his exact words). He plans to down size our military commitment in Iraq (which I’m all for), but almost in the same sentence he plans to ramp up our commitments in Afghanistan…so, I’m not seeing the savings. He talked about budget cuts to the US military (something about ‘not going to support any more cold war weapons systems’), but he plans to expand benefits and pay to military personnel (again, I’m all for it…but where is the savings?). It’s the same with all of his speech…on the one hand he wants to reform education, say, while increasing spending on it.
During his speech he made a statement that went something like ‘we have found $2 trillion(!!) dollars of waste in the budget that we are looking at cutting’ and I’m thinking…say WHAT? Again, I’m ALL for cutting the budget and especially waste but…$2 TRILLION!!!
I’m just not seeing how he can do everything he stated in his speech AND cut the budget deficit. I don’t see where all the money for all those really cool plans and ideas is going to come from. I understand that it’s ‘soak the rich’ time…but just how much does anyone really think we can soak them for? Leaving aside the killing of the golden goose, they only have so much they COULD (and would) give. Even if he’s only going to increase taxes on the top 2% (according to Obama in his speech this will only effect those making over $250k/year IIRC), how does anyone think that we’ll actually GET all that money out of them…or that this money will somehow balance tax cuts to everyone else AND all of these programs??
Well…it depends I guess. It depends on if he actually follows through on all the programs he was talking about and exactly how he does it. It depends on the effects to the economy soaking the rich has. It depends on what he cuts from the budget and how…and what he adds to it. It depends on how much ACTUAL money we get out of soaking the rich, or if they simply find alternatives and shelters in other ways.
That’s a lot of ‘it depends’ there so…
Well, again, it depends on how it plays out. If he is able to add his new programs while slashing programs that don’t work and make things balance then he’ll get credit for that. If the economy turns around and starts to really pick up steam he’ll definitely get credit for that. Oh, not from everyone…but from enough. Hell, if he IS able to bring about all the stuff he was talking about AND cut the budget deficit AND have the economy recover then he’ll be a miracle worker and I’ll DEFINITELY be voting for him again in 2012. I just don’t see how it’s possible…but then, IANAE nor do I play one on TV.
Well…yeah. That’s different than what you asked though. You asked if he would get credit IF IT WORKED…at least, that’s how I read it. Of course Republican’s are going to be against it now…some for political reasons, some because they simply don’t think it could possibly work. I don’t think most of them will be fighting him because they secretly think he’ll succeed…that’s like saying that you are fighting against Creationists because you secretly feel that God is real and Evolution is just a flawed theory.
I predict that if he pulls this all off and shows them the money they will by and large shut up and focus on other things. Now all he has to do is make it all happen. I will be watching avidly…after all, if he pulls it off it will help everyone.
-XT
On that two trillion dollars in savings: I believe he spoke of that within the context of some ten-year projections on deficit reduction. It wasn’t explicit, but if my memory doesn’t fail me, I got the impression that the cuts would produce those savings over a decade’s time.
I haven’t gone back to the text of the speech to confirm the memory; I tell you merely the impression I was left with – right or wrong.
If you find out let me know…the way it sounded to me is that he found $2 trillion in the ANNUAL budget. If he’s talking about $2 Trillion over 10 years…well, even that would be significant, no doubt.
-XT
Every new president promises to fund his own programs with a new commitment to ending ‘waste, fraud, and abuse’. It never happens. It won’t happen now.
A fact check page from CBS News quotes it:
As CBS points out, 10-year projections don’t amount to much.
So John McCain was lying to us too?
You say that like it was a bad thing.
It is a bad thing for any fiscal conservative.
Thanks! Nice to know senility hasn’t entirely taken me over.
I agree ten-year projections like that don’t amount to much, other than as a first draft of a road map to where he wants to take us. Still, it’s a start.
They’ve had their chance, and look where it got us. It turns out, fiscal conservatism strangles the economy. Tax cuts don’t create jobs, and deregulation encourages the private sector to rape the consumer. We won’t make that mistake again, at least until this generation is replaced by one who can’t remember the depths of our current economic spiral.
Funny, I remember not too long ago on this board when all the Democrats were claiming that fiscal conservatism was a characteristic of Democrats, and so many here went on and on about the horrors of Bush’s deficits.
Now Obama wants to quadruple the deficit, and suddenly fiscal conservatism is SO yesterday, and the reality based community is full on board with spending money the government does have at a rate not seen since WWII.