Democrats & Liberals Archives

The Politics of Decay

Why aren’t we seeing more shovel-ready projects in the stimulus bill? Well, the issue is that the short-term projects which are ready right now, aren’t necessarily the best or most necessary. But there’s a reason we’re in this pickle.

In many many ways, America liives off an inheritance, one that came of a generation with far more initiative towards public service. Republicans appeal to the greatest generation on account of the glorious war they fought, their unbridled patriotism. They neglect, though, how very liberal, how very comfortable with public works projects these folks were. What Republicans would nowadays disparage as socialism was par for the course with them.

Democrat or Republican, the folks who came to maturity in that era had a greater sense of just getting the job done. They might use harsh words in debates, but many of these people could meet as friends in private, and talk with one another.

It was a Republican who created one of the greatest public works projects of all time, the Interstate Highway System, and a Democratic Congress which funded it. There was a time when spending on infrastructure was seen as a net positive. There was a time when fiscal conservatism didn't mean you wouldn't raise taxes, but rather that you wouldn't run deficits.

Fast-forward to our time. A sustained tax revolt has seeped into America's pores, to the point where even liberals are hesitant to raise taxes. But as any business man can tell you, we have spend money to make money. We talk of shovel-read projects, but mostly we're talking about filling in the potholes and picking up projects that might have recently been laid down for one reason or another.

We have a start there, but it cannot be the end, and the stimulus bill cannot be considered the last word on what can be moved forward on this concern. For far too long, we've lived off the civic-minded gifts of our grandparents, but time is no friend to the works of man, and even something so great as today's infrastructure cannot last forever, cannot endure without renewal.

It's not going to be cheap, but it's going to be expensive because we've put it off for so long. To enjoy our nice, pleasant tax cuts (who doesn't want more money?), we've had to design a system that works off the bare minimum of spending. Short-term planning is favored over long term, maintenance of the old over construction of the new. Even maintenance eventually suffers as the focus becomes more strongly on personal gain than on supporting the good fortunes of all involved.

We need to do better than that. We do have the ability to rebuild the infrastructure, and build it better in fact.

The internet infrastructure is another important area we need to be addressing. Given the events of the last couple decades, a person could be forgiven for wondering why internet speeds aren't greater for people in America, the land that invented the internet. My internet service runs at about 6 mb/s. The American average is 1.9mb/s. But the average person in Japan has a service that runs at 61 mb/s. Can somebody tell me whose bright idea it was to just let this issue lie with the telecommunications companies, to not push them?

For the last thirty years, our focus has been on making money through speculation and bargaining, rather than the provision of real goods and services. The real world economy was seen as an adjunct to an economy of convenient financial fictions, where wealth swelled on paper and collapsed in reality time and again. An economy, though, is all about encouraging people to make the best use of their time, effort, and resources, and that can't all be done individually, or without sincere investment.

We've lost a great deal of our goal-orientation, our ambition in this country, and have adopted a conservative stance that perpetually justifies sticking with what we have and just getting creative with how we use it. Things like infrastructure, scientific research, education, have been held hostage by a bean-counter mentality which values saving a dollar more than making better, more productive use of it. As a result, we have become a wasteful society, with an unsustainable culture, and a badly disorganized sense of cooperation. Sometimes it makes sense to let people figure out things for themselves. Sometimes, though, we need to act together. You know, neither of these is mutually exclusive of the other. We can pursue our own individual goals and pursue goals together. Those who have pit one against the other in this country have essentially sacrificed both. For with better roads, bridges, grids, and other infrastructural components, individual ambitions become easier to fulfill. With everybody out for themselves, we've put up obstacles to the ability of many to realize their dreams.

Posted by Stephen Daugherty at February 7, 2009 7:53 AM
Comment #275170

For Republicans who aren’t inclined to take the current economic crisis seriously, who wish to claim that this is all just about scaring people, a charge they make similar to what we did concerning Iraq, let’s consider something: What the Republicans claimed true during the run up to the Iraq war turned out to be demonstrably false. However, It’s demonstrably true that we are in deep economic kimshi.

In the case of the economic crisis, though, maybe Americans aren’t panicking as much as they should: the job market spiraldown continues, and more apocalyptically, the rate of decline is picking up. The labor force is contracting rapidly; the unemployment rate is close to its 1990s peak at 7.8%. (Want higher than that? Go to the 1970s.) Americans are working fewer hours, too. Scary! Christina Romer, the White House’s chief economist, noted that of the 3.6 million jobs lost over the past year, most of them have been lost in the last four months. The rate is comparable to the rate recorded by economists in 1938, during the….yep.

Now the Republicans, it seems, have a habit of employing previously discredited approaches to government, on the premise that this time, if they try hard enough, they will succeed. They tried this with regulation. It failed. Not just failed, failed catastrophically. And not just once, but quite a few times, each time slowing if not reversing growth in the US markets.

They sat by (with certain Democrat’s help, of course) and let the car companies engage in the same old gas-guzzler approach that Detroit tried in the sixties and seventies. Result? Pretty damn much the same. Once again, gas prices helped cripple an economy.

And of course, the kind of tax cuts that failed to stimulate well in the eighties once again failed to stimulate well in the double-o’s.

Republicans essentially tried to vindicate each part of the Vietnam effort, from the sunk cost fallacy, to beating the crap out of the media when it reported the unpleasant truth, to demonizing the left, to even the guns and butter approach, only to essentially repeat the outcome of nearly every mistake in question.

They (and I don’t know how they squared this contradiction) essentially tried to mix 1920’s and 30’s American isolationism with 1950’s and 60’s cold war hardliner attitudes, essentially reminding everybody about why the first and the second both failed and creating a foreign policy worse than either of those two combined. I mean, I can recall that in the first World War, a jingoed up America went so far as to call hamburger “Salisbury Steak” and sauerkraut “Liberty Cabbage” in an effort to cleanse our society of anything German. Imagine my sensibility when we start using the same sort of tactic with our allies. One can at least square the sense of demonizing your enemies, but this is demonizing an ally who was merely less than useful to our President’s foreign policy.

The old adage goes, “We may be through with the past, but the past is not through with us.” Well, you could revise that for the Republicans to say “The past may be through with the Republican’s, but the Republicans are not through with the past.”

And now, apparently, they want to prove themselves right on the Great Depression. They claim to want to avoid the policies of the Hoover administration, but they’re intent on relying on people’s own resources to pull them back up. For those who consider deficit spending during a depression to be a problem, consider this graph. Under Hoover, the proportion of national debt to the gross national product doubled. Under FDR, it remained level at around 40%, despite FDR’s increased goverment spending.

Which is to say, that economic growth under FDR kept pace with the growth of spending, while under Hoover’s the spending outpaced it. The paradox here can be resolved if you look at things in terms of the effect of the spending, rather than merely the fact of the spending, something conservatives with an aversion to wanting to have much of an effect directly do not consider.

Posted by: Stephen Daugherty at February 7, 2009 12:20 PM
Comment #275173

Daugherty writes more fiction saying; “But as any business man can tell you, we have spend money to make money.”

He conveniently leaves out the fact that the business person doesn’t expand his business by subtracting the cost from his employees.

Daugherty continues by saying; “we’ve had to design a system that works off the bare minimum of spending.

Hmmm. apparently Daugherty has no knowledge of the huge sums wasted already by congress in pandering for votes to stay in office to spend more. What is our national debt now…how many trillions. And Daugherty calls that a “bare minimum of spending.” I would ask, what unfathomable amount would constitute prudential spending?

More from the Daugherty Dreamworks; “And of course, the kind of tax cuts that failed to stimulate well in the eighties once again failed to stimulate well in the double-o’s.”

This lie has been told so often and the light-headed believe it. Providing proof doesn’t work for these folks so we’ll just let them slumber in their self-induced coma.

Daugherty ends his dream sequence by uttering these words…”but they’re intent on relying on people’s own resources to pull them back up.”

Oh my goodness, someone failed to tell me that government has resources that it hasn’t gleaned from individuals. I wonder why it is then that he and other liberals want to take more of my resources from me.

Liberals…just like puppy dogs…you gotta love em. They’ll wag their tail for a few scraps of food from the government table.

Posted by: Jim M at February 7, 2009 2:32 PM
Comment #275176

Democrats used to be known for their policy of tax and spend. The Republicans gained control of government and created their own policy which was tax break, borrow and spend. Now that the Democrats have regained control of the government, one can argue that their spending priorities differ from the Republicans but, they have addopted the Republican policy of tax break, borrow and spend.

If fourty years ago, someone would have suggested that the Republicans would sell this country out to a bunch of multi-national corporations, I would have had no problem believing it. If they would have said the Democrats will do the same, I would have laughed at their joke. I’m not laughing now.

Posted by: jlw at February 7, 2009 2:53 PM
Comment #275179

I’m sorry to say it, but jlw has it right on. I guess it’s need for campaign money, but both parties are sold out to special interests.

Posted by: Mike the Cynic at February 7, 2009 3:21 PM
Comment #275180

Jim M-
Employers were laying people off in good times as well as bad. They were forcing concessions, defaulting on pensions, shopping for cheap-s*** insurance, employing people part time, seeking out foreign workers… don’t give me crap that employers don’t seek subtractions of cost from the labor force. around 13% of America is feeling that subtraction right now, unemployed, underemployed, whatever.

Dreamworks. You know these numbers haven’t been this bad for well over thirty years. Like I posted in my comment, the acceleration of unemployment is unparalleled since the Great Depression.

You tell me. Who’s dreaming? Who thinks that this isn’t going to be one hell of a bad recession?

You folks spent the better part of this decade paying for all your fun, all your spending the same damn way we’re going to. Only you didn’t have the justification of what is likely the worst recession in some time. No, you folks deliberately deficit spent, so you wouldn’t burdent people with the out of pocket costs they could have handled.

But in our case, we’re dealing with a different situation. In this case, the whole point is to spend and not take money out on the backside. The whole point is to put dollars in people’s pockets and keep them there. They’ll have to pay for it later, but we’re not kidding anybody about that. This is not elective spending that we’re just too chickens*** about the cost of to raise revenue to make up for. No, this is necessary spending, which we have to defer the costs of in order to avoid making the situation worse.

Let me repeat what I’ve said elsewhere: inflation is no longer a problem. Deflation is the problem. People can’t pay prices, so prices are dropped. But dropped revenues put people out of work, diminish the growth of their earnings, and thereby cause even more reduction in spending, more reduction in prices, and so on, and so forth.

When we get back on our feet, we need to tighten our belt, once more, raise taxes and do what’s necessary to keep the rubberband from whiplashing in the other direction. But not until then.

There’s no denying that there’s going to be a hefty price to pay. But for what?

We’re paying for a regulatory regime that allowed false pictures of growth to develop, which, for political and ideological reasons refused to believe that anything that could be done within the market could be destructive to the health of the market itself.

Our current debt is the result of a cowardly effort by folks within the Bush administration and the Republican Congress to win and keep favor for their policies without adding the consideration of out of pocket expenses to the equation. The Republicans couldn’t honestly face Americans and ask them to pay for a war or for new entitlements and government agencies. The Democrats learned the hard lesson of this mistake in the LBJ era. The Republicans, it seems, dreamt up a fantasy world where they could commit the very same mistakes, but succeed.

The delusions and dreams belong to those who believe that they could merely sustain what their fathers and grandfathers instituted and built, and not add to it. Some Democrats are guilty of this, some Republicans. But the Republicans have also pushed an era of irresponsible fiscal policy which made it difficult to even conceive of renewing public works. Now America finds itself presented with a crisis and an opportunity.

If we play our cards right, we could find ourselves much better off in a few years than we imagined we could be. We’ll have to pay back what we owe, but we’ll have a better economy to pay it back from. But if we act like Japan did, in its economic crisis, and get too stingy out of fear or ideological fervor, we could find these economic doldrums to be a long, dead calm of American productivity.

If we really want to come out of this strong, we can’t be small-minded or tight fisted about our efforts to stimulate the economy. At this point, as one obscure, little-quoted, Democrat said, the only thing we have to fear, is fear itself. Let’s commit ourselves to renewing America’s economy.

Posted by: Stephen Daugherty at February 7, 2009 3:23 PM
Comment #275181

Stephen, I once believed there was no way to shake your level of tolerance or patience, but in light of the attack by the super-stupids, I do see it beginning to wane.
Please don’t get sucked in all the way….your insight and contribution on here is respected and valued.

Posted by: jane doe at February 7, 2009 3:33 PM
Comment #275182

jlw, mike the cynic-
We can either spend out of this recession, or crawl out of a much deeper hole. That’s what most credible economists are saying.

We are not spending this money here out of a deficit because we can’t be bothered to properly finance the programs like we should. We are doing this, this way, because the situation is such that if somebody doesn’t spend money into our economy, we will see people having less and less to spend over the next few years, and if we try to pay for it with taxes, that will only take more of the money that should be staying in the economy out of it.

The Republicans have been too successful at getting everybody to think that all deficit spending is unnecessary and bad for the economy. Not enough people remembered the depression, remembered Hoover’s failures to understand that under some circumstances, doing what was the right thing during the Clinton years, raising taxes and reducing spending can be the utterly wrong thing now.

I just got to ask people: where’s all the new spending to stimulate the economy going to come from? From the banks whose portfolios have collapsed? From the consumers who are having a hard enough time making ends meet, and who now don’t even have the credit they once had to make the shortfall? From an interest rate cut, when it’s already at zero?

Just where is this money going to come from, if we want to avoid a damaging recession worse than anything most living Americans have ever seen?

Posted by: Stephen Daugherty at February 7, 2009 3:42 PM
Comment #275185

Daugherty writes: At this point, as one obscure, little-quoted, Democrat said, the only thing we have to fear, is fear itself.”

Unfortunately one, front-page, often quoted Democrat…PO, is saying, “we’re facing a financial catastrophe”. Unlike FDR, PO is saying the only thing we have to fear is “everything”.

Daugherty asks, but doesn’t answer his question; “I just got to ask people: where’s all the new spending to stimulate the economy going to come from? From the banks whose portfolios have collapsed? From the consumers who are having a hard enough time making ends meet, and who now don’t even have the credit they once had to make the shortfall? From an interest rate cut, when it’s already at zero?

OK, Daugherty…I’ll bite, where is it going to come from?

The Daugherty Dreamwork factory would have us believe in magic. Take $10,500 from every American family’s pocket, spend it, and a few years from now send them the bill for the money pilfered from their pocket. This will restore American confidence? For sure, that’s a “change” we can believe it. If Daugherty so strongly believes in having his pocket picked as a way to restore his confidence, just imagine the euphoria he would feel if they took $20,000 instead.

Posted by: Jim M at February 7, 2009 4:38 PM
Comment #275192

Jim M-
I’ll tell you right off the bat we’ll have to pay this back. YOU HEAR THIS EVERYBODY? WE WILL HAVE TO PAY THIS STIMULUS BACK!!!!!!

I’ve got no illusions about what this does to the national debt, nor what exactly we’re doing, nor who is going to have to pay for it. There will not be any escape from the cost of this, from the sacrifice later that will be required of us.

And no, people aren’t oblivious to this.

Most people support a stimulus package, and most support a stimulus at least somewhat like what we got. They think its a good idea.

You twist around FDR’s words about fear, forgetting that the fear he was talking about would be the fear that would get in the way of doing everything they could to confront the problem, which is essentially what Obama has been talking about.

Go ahead and put out those figures of yours. Tell people just how much debt this is going to put them into. I want them to know. I want them to consider this rationally, and with the facts before them.

I also want them to consider just what dire economic straits they will be in. I want them to consider that the alternative to an effective stimulus package will be a deepening recession. We are not offering them a panacea, a free cure-all here. We are not pretending, like the Bush administration has that this spending is not going to contribute a consequential amount to our debt.

But we won’t pretend like this is one of those times where we can get away with sacrificing nothing. Your party didn’t have the guts to directly ask the American people to cover the war with their economic strength. We could have managed it easily, and still been prosperous. Instead, President Bush (or should I call him PB?) refused to give up the tax cuts or do anything that might indicate to people just what they were sacrificing.

I want people to consider the dilemma we are in, and make the decision of whether they want a stronger economy in the next few years, and to also consider the feedback of consequences that will come of a violently shrinking economy. It may be no more than a question of which point it is more effective to deficit spend or raise taxes, because the decline in revenue that is sure to come may just end up making one or both of them worse. It did under Hoover, as he tried to pull America out of Depression without dealing with the problem of demand.

Japan tried things your way, ultimately, and they haven’t recovered yet. We have to make some difficult decisions here about where our economy is going to go, and it is not wrong to look at the negative examples of where people have made mistakes, and learn from those mistakes.

Unfortunately, the Republicans are more interested in proving that their various stances at various times in history were not wrong, rather than figuring out in the here and now what is right and wrong.

Posted by: Stephen Daugherty at February 7, 2009 6:31 PM
Comment #275201

Krugman, speaking on the Senate compromise:

Now the centrists have shaved off $86 billion in spending — much of it among the most effective and most needed parts of the plan. In particular, aid to state governments, which are in desperate straits, is both fast — because it prevents spending cuts rather than having to start up new projects — and effective, because it would in fact be spent; plus state and local governments are cutting back on essentials, so the social value of this spending would be high. But in the name of mighty centrism, $40 billion of that aid has been cut out.

My first cut says that the changes to the Senate bill will ensure that we have at least 600,000 fewer Americans employed over the next two years.

The real question now is whether Obama will be able to come back for more once it’s clear that the plan is way inadequate. My guess is no. This is really, really bad.

Posted by: Marysdude at February 7, 2009 8:06 PM
Comment #275205

To be honest with you, I am not as pessimistic as Krugman is about the ability to get further stimulus as needed. If the stimulus passes without the help (or despite the hindrance) of most of the Republican Congress, it will become clear to at least some politicians among their ranks what their situation is.

Obama’s already laid out the groundwork, played down expectations that this can be done in one swell foop. Additionally, this economy’s going to get worse over the next year, and God bless and God help the idiot who’s trying to run for reelection on a platform opposing stimulus for this economy.

We also can’t be sure what comes out of the reconciliation session. I’ve been in politics and following Obama around long enough to know that the worst thing to do is panic. You must think long term. You must think, “what’s my next step after this?” The Republicans are thinking insurgency. But does anybody remember just how unpopular an insurgency can get when it lacks support among the majority of a population? Somebody like Jeff Sessions can say that because he’s likely from a safe red state congressional seat. The rest of the party, though, might not be so fortunate as him in their political demographics.

Posted by: Stephen Daugherty at February 7, 2009 9:01 PM
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