Democrats & Liberals Archives

Read My Lips: No New Ideas

If you are constantly having to clarify your statements after the fact, it’s time to shut up and reconsider what you’re saying. After that nice, gift-wrapped gold nugget of a gaffe from Joe Barton, one would think Republicans would pull back and start to think of alternative messages to send. But no, they can’t do that, because they’ve tied themselves to a platform of policy dogmatism the likes of which hasn’t been seen in a long time.

Killing an ant with a nuclear weapon. That's how he described reform in the Senate.

I agree with Obama on this. "He can't be this out of touch."

What exactly the ants that we should swat to deal with that system-wide collapse, Boehner doesn't say. People like him are downplaying, constantly downplaying the need for "Big Government" as they call it.

And people like him voted for things like the bill that repealed Glass-Steagall, and made derivative regulations actually illegal. People like him took the recommendations of Bush's secret energy task force. (secret because Cheney sued to keep the guest list secret) and reduced permitting review time to thirty days, not to mention exempting many oil rigs from environmental impact studies.

And when we want to change the law to put things back in order? Well, of course, the answer is no. No, no, no, and no again. Even to the Homeless Women Veterans and Homeless Veterans With Children Act

My comment on that, published elsewhere was admittedly a bit snarky and morbid, but I think it makes my point:

Republicans better get careful... the way they're heading, they'll soon be blocking the "Preventing Cute Babies from Walking on Landmines and Being Dropkicked into Industrial Blenders Act."

Republicans aren't there yet, but they've been heading that direction for some time now.

And why? Becaue they have this funny little thing about government not helping the average person. They'll spring for hundreds of billions of dollars a year to keep wars going, hundreds of billions to keep the banks open, given trillion dollar tax cuts to the rich, prevent Medicare from bargaining drug prices down, but keeping unemployment funds going for millions kept out of work?

He said, pay for it out of stimulus funds! Pay for it out of funds meant to get people OFF unemployment! Bunning told these people, for the sake of his political point, "Tough ****". And he managed to mourn not being able to go a basketball game. I guess he wanted his life back, just like that other guy.

And guess what? It's the new style in Republican circles. They believe that they can cut people off of unemployment benefits (or as they call it, funemployment, because being one step away from utter destitution is just great recreation), and that will help solve the fiscal crisis. Never mind that every dollar of unemployment benefits puts a dollar and a half worth of economic activity into play.

The Republicans are constantly going back to the Wonderful Well of Reagan,, again and again suggesting that tax cuts for the rich are the necessary stimulus to get the economy back in order. Taxes haven't been this low in decades, but never mind. Cut more, and pretend, just like we did with the Bush tax cuts, which are responsible for a huge amount of our current debt, that it's all for the good of the economy, and will somehow result in an increase in revenues (with people who have held their breath for those increases now dead of anoxia.)

And they're going to give this to the people who have kept a greater share of the wealth in this country than any other Americans.

For people who are ultimately destined to make it just fine in the new economy, such questions are troublesome, and cut at their bottom line. For them, the new regulations truly are Nuclear Ant Exterminators. But it isn't such a small matter to the millions of Americans now out of work, now impoverished by the results of Wall Street's malfeasance and fraud.

Because the Republicans rely on the notion that any rise in government enforcement, regulation, or power in response to such events are an evil to be combatted, it is in their interests to minimize and deny the import of any events that might spur people to grow government, increase its authority and reach. Even after spectacular, colossal failures, the GOP is still sticking with its old notions of how the government should work.

There are no new ideas for the Republicans, at least not ones you want to talk about too openly. They seem to be in a big hurry to return this country to the economics of the late eighteen-hundreds.

In the United States, economists typically refer to the Long Depression as the Depression of 1873–79, which followed the Panic of 1873. The National Bureau of Economic Research dates the contraction following the panic as lasting from October 1873 to March 1879. At 65 months, it is the longest-lasting contraction identified by the NBER, eclipsing the Great Depression's 43 months of contraction.[4] [5] Following the end of the episode in 1879, the U.S. economy would remain unstable, experiencing recessions for 114 of the 253 months until January 1901.[4]

This is the way an economy that favors the wealthy works, and what the Republicans want is continued fidelity to this way of going about things. I think it's something we have to stop. I am not a socialist, wanting to nationalize everything left and right, but I am a believer in setting ground rules, setting standards for the way business is done to discourage useless, dangerous, and fraudulent activity. Government should neither be friend nor enemy to business in my opinion, but sometimes it must be adversarial in order to make sure that the Public's interests are served.

And by public, I do not mean the few at the top. I mean everybody. I do not believe that a system that counts on the rich to rain down benefits to everybody works. I believe we need a system that encourages an equitable distribution of money in the economy, not by direct, heavy-handed policy, but by good labor laws, good consumer protections, and a decent system of safety nets to prevent life's ups and downs from becoming life's flaming crashes.

I am sick of being told to stand on the sidelines, and sick of seeing Republicans drag Congress in that direction. They wish to be gifted with the authority they once abused again, but they show no sign that they'd do anything else than what they did, and where they indicate a change of attitude, it's towards taking an even harder line on an already hardline agenda. Where is the future of the Republican Party, if they maintain this course?

"As I look out at the political landscape now, I find plenty of slogans on the Republican side, but not very many ideas," Bennett said. "And indeed, if you raise specific ideas and solutions, as I tried to do on health care with Ron Wyden, you are attacked with the same vigor as we've seen in American politics all the way back to the arguments over slavery and polygamy. You are attacked as being a wimp, insufficiently pure, and unreliable."

Bennett argued that as things stand now, Republicans could lose control of Congress as quickly as they win it.

"The pendulum will swing. And we will take control of the House -- I think that's going to happen -- and frankly, with the death of Robert C. Byrd there's a chance we will take control of the Senate as well," he said. "At which point, it's 'thank you for the slogans' and 'thank you for the election.' But in the immortal words of Robert Redford in the movie, The Candidate, 'What do we do now?'"

The Republicans have strained their ability to rhetorically charm and fearmonger their way into power to its limits. But you can't simply be all talk. You can't deride government for being prepared for disasters one minute, and then turn around and yell and scream about how it's not coming to your aid the next.

This basically comes down to an attitude that only lets the government move to deal with problems when the problems have already gone out of control, and then only enough to get people off your back. This attitude has been part and parcel of the sharp decline of this country under Republican Governance, and under their record breaking obstruction of the Democrats who succeeded them.

Until the Republicans become a force for change, real change, not change back to their old doctrines, they will continue to stand in the way of America's recovery and prosperity. We need, and deserve better than that. We need new ideas, and a willingness to govern responsively and responsibly.

Posted by Stephen Daugherty at July 1, 2010 11:06 AM
Comments
Comment #302961

Republicans truly believe their only mission and potential accomplishment in the near future is to bring down Obama by any means necessary. They are now taking a stand on ruining the economy even further in order to fulfill that objective. By filibustering the unemployment extension, they are rejecting the needs of the American people, in favor of harming the record of the Obama administration. By filibustering the financial reform legislation (flawed as it is), they are choosing to allow the banking private sector to go unchecked and unregulated in the same manner that brought this economy down in the first place, and American workers and savings along with it, all for their own selfish political hopes and tactics to diminish the record of this president.

When a Party is willing to directly do harm to the American middle class in order to score political points, that Party undermines its own credibility with the voting public. Their psychology seems to reflect the idea that their reputation is already in the mud, so they have nothing to lose by bringing the rest of the nation into the mud right along with them.

The GOP’s actions are crossing the threshold into rabid behavior. They are in fact, helping the Democratic Party more than the Democratic Party is helping itself, as far as the November elections are concerned. Objective voters can see the efforts of the majority of Democrats as attempting to make some progress on their behalf. All they can see from Republicans are obstacles to those efforts to help them, the two Senators from Maine and a handful of Republicans in the House, excepted.

Mitch McConnell’s strategy of making these Democratic legislative efforts, Obama’s Waterloo, is proving to be Democrat’s life raft in an election year when they otherwise, should have had no hope of holding onto majority power.

Posted by: David R. Remer at July 1, 2010 8:34 PM
Comment #302966

David R. Remer-
Here’s what I think. Republicans going into 1994 had significant successes behind them, in terms of winning elections and pushing the national consensus to the right. But what they also had was a nice, seductive plan to remake the country, and a lot of people went for it. They had new ideas, and enough moderates and moderation to sell it as more centrist.

They’re trying the same thing again, trying to create the impression of a vast movement against big government and Democracy party “socialism” Their problem is, they come into all this with the Bush Decade and all its debacles on their record. They come in at a time when people aren’t really all that averse to government coming back and regulating the bad actors.

They come in having basically failed in their mission to prevent the passage of healthcare reform legislation, however watered down. And polls are showing popularity rising for that, as the venom of the recent campaign of defamation wears off. Democrats will likely get some form of Wall Street reform on the books, they will tackle Wall Street reform, start pushing for jobs and things like that, and so on and so forth.

Even if Democrats do lose a substantial measure of the majority this fall, or even a house or two, what is the Republican alternative, and where, if anywhere, do the Republicans have the ability to compromise to actually do something useful for voters. Despite that they think, preventing socialism and FEMA death camps is not a reason for people to create and maintain a Republican majority. If they have nothing to offer, and no mandate to offer it anyways, what can they do?

The Democrats main problem is Democrats who vote like Republicans, and a never-ending campaign of obstruction. The Democrats, though, have the advantage of more or less wanting to go in the direction the country wants to go, policy-wise.

Posted by: Stephen Daugherty at July 1, 2010 9:58 PM
Comment #302967


David, think of the attacks on Bill and Hillary. If Hillary had won the nomination and the election, I believe that attacks on her would rival those on Obama.

I do feel that Obama is better for the Republicans at this time because he is a symbol that allows the Republicans to feel that they can promote a lost cause; that is, they can appeal to white males who see their power structure crumbling. That is the golden age that they are promoting a return to. It is an impossible cause but, it will be a force in politics for possibly a couple more decades.

You don’t need new ideas to appeal to this sentiment, indeed, new ideas would be a detriment. This is really the only option that a party bankrupt in the new ideas department has to promote.

We should remember that the Democratic Party is not overflowing with new ideas either. Especially when it comes to the parties politicians. They seem rather content to stick with the status quo, producing only minor adjustments.

Posted by: jlw at July 1, 2010 10:00 PM
Comment #302979

All the ‘conservative’ complaining about big government and high taxes is bulls**t!

1. 66% (2/3) of US Corporations pay NO FEDERAL TAXES.

2. 72% of foreign Corporations operating IN the USA pay NO FEDERAL TAXES.

2. The top 1% pay ONLY 13.7% of the overall tax burden in this country AFTER Tax Breaks & Shelters are applied to their Annual Gross Income (AGI).

3. The Middle-Class & lower-to-middle class are the Top 25% earners & paid 86.3% of national tax liability.

4. That means, for the top 1% IT’S THOSE TAX BREAKS & SHELTERS THAT REDUCE THEIR TAX LIABILITY (AGI) from 33% to 13.7% (which is the same percentage as the BOTTOM 1% wage earners)

5. It’s PATHETIC that so many corporations make big profits and pay NOTHING to support our country …yet they & the ultra rich benefit MORE than any group for OUR TAXES: military, defense, police, firemen, CoastGuard, Port Authority, and special treatment as super-citizens.

* Source on Corporations paying NO TAXES is Government Accountable Office Report
http://www.gao.gov/new.items/d08957.pdf

* Source on top 1% Tax Breaks is the IRS …
Internal Revenue Service, http://www.irs.gov/taxstats/indtaxstats/article/0,,id=133521,00.html
and
http://www.irs.gov/taxstats/indtaxstats/article/0,,id=133521,00.htm

Posted by: Marysdude at July 2, 2010 10:15 AM
Comment #302996

Stephen D., I agree with reply in general. I only take exception to your last sentence: “The Democrats, though, have the advantage of more or less wanting to go in the direction the country wants to go, policy-wise.”

More or less, EXCEPT, on the issue of deficits and debt. The most egregious policy and political error of the Democrats at this time is not marrying their recession recovery deficit spending to a credible longer term plan for ending deficits and halting the Medicare/Medicaid debt. The general public would be far more tolerant of Democrats role in the majority during this time if believed there was going to be a future worth having in this country, economically. Democrats have not even tried to make that case to the American public.

DUMB! HUGE DUMB! It is the Economy, Dullard! And Democrats fail to acknowledge that for those 90% of Americans who still enjoy an income, it is their perception of the FUTURE economy, and it is bleak, that is driving a wedge between their vote and the Democrats.

Posted by: David R. Remer at July 2, 2010 3:54 PM
Comment #302997

jlw, watching many of the Committee hearings and reading about the Committee markups and amendments, it appears to me a lot of Democrats have had quite a number of bold and innovative ideas on rescuing our nation’s future. The problem is, they can’t pass them through the Senate, and Dem’s have stupidly compromised EVERY innovative and worth policy idea in the effort to acquire a couple Republican votes in the Senate, which were never going to be there from the gitgo.

A monumental political advantage by Democrats was not seized and exploited by this STUPID move. Had they gone forward from Jan. 2009 refusing to compromise effective and sound ideas, like the Public Option in health care, Republicans would now be loathed and hated by the broad middle class of voters, white and non-white, for their obstructionism. Instead, Democrats now wear the INEFFECTIVE and WEAK-KNEED labels by their own constituents going into the November elections. The height of stupidity for a political party is alienating its base. This is the one advantage Republicans had over Democrats, not abandoning their base, though their base has now split in really deep ways, and hence, so is their party and platform issues.

This is one of the primary reasons they have chosen to bring Democrats down instead of working cooperatively to solve the nation’s problems. Any position they take on policy in Congress will alienate some major faction of their base. So, they chose not to cooperate on any policy issue, and preserve their base’s support.

Posted by: David R. Remer at July 2, 2010 4:09 PM
Comment #303008

Marysdude

From your linked report - “As figure 1 shows, the number of large FCDCs and large USCCs that reported no tax liability peaked around 2001 and 2002. These years correspond roughly with a period of economic recession in the United States.”

You don’t pay taxes if you are not making money. If it is costing a firm more to make and distribute its products than it earns selling them, there is no profit and so no tax liability.

What about that do you not understand? If you sell your car at a loss, do you think you should pay taxes on that?

You say - “3. The Middle-Class & lower-to-middle class are the Top 25% earners & paid 86.3% of national tax liability.” What does this even mean? The top 25% of earners are the top 25%, i.e. they have the top incomes. They are not by definition the middle or lower classes.

Posted by: C&J at July 2, 2010 10:10 PM
Comment #303009

Marysdude

And let me ask a simple question. I assume that we are both middle or lower middle class. What if they taxed $100% of our income? Is there enough revenue in the salaries of people like us to support the Federal government? I don’t think so. The “poor” don’t make any money at all. If you taxed the total income of the lower 20% of the population you would get almost nothing at all. So the Feds must be making the big money from somebody who has more money than we do. Who is that?

Posted by: C&J at July 2, 2010 10:16 PM
Comment #303014

Read my lips, Stephen Daugherty.

Do you remember when I said, “It’s the double standard, stupid!” ?

That post got me banned, remember?


It is the Economy, Dullard!
Posted by: David R. Remer at July 2, 2010 03:54 PM

I’m not going to make an issue of this double standard.

OR AM I?

Posted by: Weary Willie at July 2, 2010 11:04 PM
Comment #303025

David R. Remer-
I don’t deny that the Democrats in Washington are sometimes a huge barrier to things. But you know, I kind of expect a little resistance from them, because they are as much a part of the status quo as anyone. They were elected in a time where being openly liberal was frowned upon, when you were expected to go with the DLC third way of triangulating against the Republicans.

This is what their experience is, and they fall back on it. Not that I like the fact, but anybody who wants to get anywhere, has to start from where things are, and improve from there.

The Democrats, at the very least, have an ideology they can be called home to, a heroic past where Liberalism helped save the country from economic ruin. Current Democratic Party incumbents spent their careers kind of conflicted between Roosevelt and Reagan, but new Democrats don’t necessarily have that problem.

Republicans, though, are another matter entirely. The ideology they would be called to come home to is one that calls on them to do nothing, calls on them to further deconstruct things.

They can’t have new ideas about how to use government, because as that guy says, that’s going to get you primaried.

As far as the Deficit goes? I think it’s worth understanding something here: a lot of the Democrats who are pushing forward to deal with the Deficit right now, are doing so by nixing further stimulus, nixing further unemployment extension, being what some on the left call Deficit Peacocks, because many voted for the wars and the tax cuts that have done far more to bankrupt the country than any liberal spending program.

Traditional Republican defifict hawkery should be considered discredited, because it is less about actual deficits, and more about finding sneaky ways to push laissez faire regulation on a public which might not otherwise think much of it.

Weary Willie-
First, I would not advertise the fact that you have. That’s like a kid reminding a parent that they’re supposed to be grounded. Second, I know he’s not calling me a dullard, merely echoing a well-known notion out there.

Posted by: Stephen Daugherty at July 3, 2010 11:17 AM
Comment #303030

Mr. Remer wrote; “By filibustering the unemployment extension, they are rejecting the needs of the American people, in favor of harming the record of the Obama administration.”

From what I read all the R’s wanted was to enforce PayGo. Surely, out of all the billions being spent by the feds they could have found the necessary money to fund extending unemployment benifits.

Most of us are familiar with the Calif story of years of run-a-way spending. Well, here’s a story to exceed CA’s.
In Illinois, the land of Lincoln, the dem controlled legislature and with two dem gov’s serving jail time and one going to trial I beleive the liberal/socialists plan for recovery is self-evident of it’s inherient failure.

And, please, don’t give me that tired old liberal/socialist spin about “it’s not the spending, we just need to enhance revenue” crap. Rising taxes are inevitable in my opinion. There is simply no other solution. However, unlike the liberal/socialists, I will demand that for every new tax dollar increase there be an equal reduction of $1 in spending. And please, don’t insult my intelligence by telling me that is cruel and uncaring. A burden…yes. But, if it’s not done the burden will be unbearable.

http://www.nytimes.com/2010/07/03/business/economy/03illinois.html?pagewanted=3&_r=1&th&emc=th

“The pension move was Enron-esque,” said Mike Lawrence, a press secretary to the former Republican governor Jim Edgar, who was the last governor to sign an income tax increase. “Blagojevich was not a tax-and-spend governor; he was a spend-and-borrow governor.”

Posted by: Royal Flush at July 3, 2010 2:46 PM
Comment #303031

Royal Flush, recessions are fought back with deficit spending. It is when the recession is over that it is necessary to focus on surpluses to buy that debt down. A lesson lost on every president since FDR, who oversaw a growing economy.

That said, I have to side with Collins from Maine on this one. If Dems will put forth an unemployment extension bill with nothing else in it, she would vote for it. Dems have got to be better than Republicans on single purpose bills if they want to get anything else done with one or a couple of Republicans passing it through the Senate. The days of pork-ladened omnibus bills are over. If you have an emergency, craft legislation that deals with that emergency and not dozens of other spending preferences having nothing to do with the emergency appropriation.

Posted by: David R. Remer at July 3, 2010 3:02 PM
Comment #303033

Mr. Remer, I agree with your second paragraph and to some degree with your first paragraph. I read with interest this article from the NY Times outlining a Jobs Bill that actually seems to be working and helping folks get real jobs, not just temporary or make-work jobs. Your comments, as always, are appreciated.

http://www.nytimes.com/2010/07/03/opinion/03herbert.html?th&emc=th

“Is it possible that there is a federal stimulus program that is putting many thousands of struggling individuals to work and is getting rave reviews not only from Democrats but from officials in conservative states like South Carolina and Mississippi?”

Posted by: Royal Flush at July 3, 2010 3:27 PM
Comment #303035

Royal Flush-
That’s a nice theory, but the last two governors before Blagojevich were Republicans, and one of them, George Walker, was one of the more recent governors to go to jail.

Also, The Illinois legislature did have Republican majorities in it, as far as I can figure it, until about 2002. So, your conviction that somehow Illinois is far left country is a bit off.

As for Republicans and Paygo?

It seems their fiscal prudence only applies when a Democrat is in charge.

House Democrats, in one of their first acts upon assuming the majority last January, passed a “pay-as-you-go” or “paygo” rule requiring that new mandatory spending programs or tax cuts be offset by an equal amount of spending cuts or tax increases so as not to add to the deficit. The AMT fix passed by the House in November contains new tax revenue, much of it raised by closing a loophole that taxes investment fund managers at a lower-than-normal income tax rate.

Senate Republicans, however, are using their filibuster powers to force the Senate into maintaining low rates for investment fund managers and accepting an unpaid-for AMT fix.

Republicans just Looooove PayGo, don’t they? This next part just makes it even better:

Treasury Secretary Henry Paulson said raising taxes when the economy is shaky is a bad idea, and the White House said the president would veto any bill with a tax increase.

And this pretty much tells us what we need to know about the Republicans on fiscal discipline:

Congress enacted “paygo” into law during the first President Bush’s administration. But that law, which fostered the balanced budgets during the late Clinton years, was allowed to lapse in 2002, when Republicans were working on the Bush tax cuts.

Bush never admitted that he was actually spending money to make sure that the AMT wasn’t hitting the middle class.

Obama Admitted it was being done, and extended it as part of the Stimulus Plan.

As for California? The problem is more complex than spending. A lot of California budget priorities are controlled by public referendum. Guess what people voted themselves? Low taxes and plenty of new programs.

That sounds like a Republican Problem.

I believe that to a large extent our current budgetary problems stem from the widespread adoption of an idea by Republicans in the 1970s called “starve the beast.” It says that the best, perhaps only, way of reducing government spending is by reducing taxes. While a plausible strategy at the time it was formulated, STB became a substitute for serious budget control efforts, reduced the political cost of deficits, encouraged fiscally irresponsible tax cutting and ultimately made both spending and deficits larger.

The best way to limit government spending is to attach a personal cost to it. When you see more taxes taken out of your check, you will wonder, much more quickly, what you’re getting out of it. That’s the theory of PayGo, as a matter of fact. Tax cuts are restrained by their effect on popular programs, institution of programs is restrained by their effect on the rising of taxes.

I’d love to have this system back and working, when the economy recovers.

The issue with our economy right now, is that for the first time since the Federal Reserve tightened money supplies in the fifties, this country has expereince negative inflation. Our problem at this point is an economy that’s on the skids, and restrained by the problems of deflationary economics.

Deflationary economics defeat attempts to address fiscal imbalances, because the austerity measures have a negative economic impact when money supply is inordinately low. And is it low? Join me at the next comment.

Posted by: Stephen Daugherty at July 3, 2010 4:44 PM
Comment #303037

The answer is: Frighteningly low.

In other words, this country’s debt problem is nothing compared to its economic problem, and its economic problem is caused by a decline in its overall strength. You’re telling us to try and balance that budget on the backs of the average person. Problem is, the average person’s problem is a lack of money. And that, in aggregate, is the whole nation’s problem, the reason for our deflation.

The deficit is first and foremost an economic problem.

One primary problem and the one that the Republicans and conservatives are trying to solve in the most misguided way possible, is the burden of our high unemployment.

They believe that people will seek out jobs if they are kicked off the rolls. Competition for jobs, though, is fierce. The disappearance of 8 million jobs is not the result of people not showing up for available job openings, it’s a result of there not being real jobs openings to show up for. Every job opening has many applicants. Businesses are not being opened, small business loans are not being made, state and municipal governments are facing harsh challenges that are forcing job cuts from those normally secure positions.

In other words, the conservative approach imagines that those on “funemployment” will simply get off their butts and work neglects the critical part of the equation, economically speaking: the actual job being there.

Without that job, there is no added tax revenue coming from that person. In fact, what that person can no longer spend will in turn contribute to other economic problems, stemming from causes like additional foreclosures, fewer paying custormers, and the turning of some of these people to grey market and black market work. Loans come due that can’t be paid, so on and so forth.

When all this is added together, it creates a much worse situation for the economy, and that in turn reduces revenue, blunting the effectiveness of austerity measures. The cuts and the tax hikes become part of the fiscal problem, despite the fact that they are meant to be the solution.

Let me put things another way: The reason why you undertake deficit reduction austerity measures is to fight inflation, right? Well, in order to do that, you got to do one of several things: One, you raise interest rates, which reduces money supply by discouraging loans and encouraging savings.

Do we want to discourage loans at this point? Well, bad loans, certainly, since they don’t help the solvency of the economy, but sure as hell not most loans, loans we know people will pay back. Also, do we want people parking their money in bank accounts? No, not really. We need that money out, being spent.

This is a major reason why the Fed has not reduced interest rates.

Another way would be to raise taxes. Raising taxes would take money out of the economy, sideline it in a manner of speaking, to hand it to our creditors, or at least slow the rate of our borrowing.

A slowing in the rate of our borrowing certainly wouldn’t be a problem if it could magically happen for some reason, but it’s not going to magically happen. Revenues will have to rise for some reason or another for this to work. The money must come from somewhere. In the case of an economy with a pathologically shrinking money supply, it will come from the pathologically shrinking money supply, ostensibly shrinking it faster.

Is that your plan? I sure hope not.

Another way to tackle it would be to lower spending, to pump less money into the economy, and hope that private lending, private financing would pump money into the economy instead. Good idea, if it actually is happening. If banks are finally lending again.

You could say, more government is smothering this development, but stop there for a second: the problem becomes that we got into this situation first and foremost by building up a bubble, a huge swell of nonexistant wealth, which we becamed dependent on. If we could simply invent wealth from nothing, this could have worked forever.

However, we are faced with a critical issue here, and that is that the bursting of the bubble came because people recognized that the houses on the market were worth nowhere near what they were supposed to be worth.

If we were simply talking a housing sector problem, that would have been the end of it. However, financial institutions became creative, and they built a second bubble on top of the first, by essentially inflating and then securitizing (making into a tradable commodity) the mortgages that they sold. When those mortgages defaulted in mass numbers, due the fact that folks really couldn’t pay for them, either because they were beyond their means, or because the people in question were speculators, and had built one mortgage on top of another, then those securities became problematic.

I say problematic, and not merely worthless, because what made those securities a financial problem was that you couldn’t tell whether it was based on a high-worth asset, or whether it was simply based on garbage.

So, the problem of establishing asset worth on the market is not a neutral problem, because if that worth is falsely attributed, you could have additional build ups of fictional wealth, and additional destruction of it.

Since economies depend strongly on judgments, and not simple realities of worth, regulation is necessary, especially of loans and capitalization. The worth of things cannot merely be built on castles in the air, like the Republicans like to permit them to be to generate faster than real growth.

So the question of private investment and lending becomes one of whether this economy, at this point, is capable of generating enough growth, through private investment and lending of a legitimate, non-bubbled variety, to displace the investment and growth by the local, state, and national governments. If not, then the reduction in such investment and lending by government will have a bad effect on the economy.

And that, in turn, will reduce revenues, and worsen the deficit problem to a certain extent.

So, of the three solutions, taxation, spending cuts, and interest rate hikes, all will take money from the economy by design, and this economy, being one from which too much money was taken by the revelation of false worth of base assets, will only contract further, in response to the contraction in money supply that these measures are designed to create.

In English, all inflation fighting measures, are by definition reducers of money supply and circulation. Our problem is excessive money supply reduction and circulation impairment. One way or another, whether it’s allowing Wall Street to reinflate the bubbles, or whether it’s deficit fighting measures meant for inflationary economies, your ways of reducing the deficit long term, or improving the economy are doomed to failure, because they are doing what they are designed to do in the wrong context.

David R. Remer-
I would look at claims of pork, especially from the Republicans, with a skeptical eye. In the Stimulus in 2009, Republicans singled out the replacement of government cars with Hybrids as an example of pork. They did the same with the basic physics research, and numerous green energy grants and programs.

Pork can be a very flexibly defined thing among some conservatives, a codeword that sometimes stands in for “spending I don’t like” rather than actually describing truly wasteful spending. I think in Susan Collins’ case, it’s an excuse. She doesn’t want to look like she’s part of the Party of No, so she takes cover behind pork as an excuse not to vote for it.

It might help, though, if you look into her recent behavior before trusting her word on what’s Pork.

To sum up the situation: a company that has never produced oil containment boom develops a new design on the fly in the middle of the crisis in the gulf and puts it into production. BP purchases a small amount of the boom to test. Before anyone can confirm whether or not this new technology works, the state’s two Senators put pressure on the federal government to purchase the product.

One other point I’d like to make: very often, pork is less a question of how much is spent, and more a question of whether it’s spent effectively. Earmarks, for example, of which there are none in the Stimulus act, are merely specific instructions as to how already appropriated money is to be spent. Republicans haven’t been shy about ordering up a passel of them, even as they’ve been chiding the Democrats for Obama’s spending, but they really have no effect on the deficit.

There’s a term for Republicans and Democrats who go after these flashy, but ultimately inconsequential or even counterproductive fiscal enterprises: deficit peacocks.

Oh, they’re all ready to show you how fiscally conservative they are.

But often enough, their methods are deceptive. Much of Obama’s increased deficit isn’t increased spending, but increased admission of actual spending that was going on long before him. Things like the Doc Fix, the AMT fix, the costs of the war were being left off budgets, not counted, but were being paid for anyways. If they hadn’t been left off, Bush’s deficits would have been huge, six hundred, seven hundred, even in times where he was claiming half that. If Obama budgeted like Bush, his deficits would look far, far smaller.

And in the case of the Bush Tax Cut, meant to create a huge surge of productivity and revenues in return, this particular “reconciliation” method, passed under the same rules that Healthcare was passed earlier this year, has contributed more to past, present and future deficits that anything Obama’s added to the mix.

The fiscal conservatives, right now, with their measures, are trying to fix a battery problem by fixing the spark plugs. They’re failing to take care of the fundamental problem, which is that the economic crisis has compounded the problems of applying fiscal austerity, not to mention opened up a much wider gap on revenues.

So, If I were you, I would go and I would support efforts to get unemployment extensions passed. They will certainly do much more good for the economy than another round of tax cuts or spending cuts.

Posted by: Stephen Daugherty at July 3, 2010 6:05 PM
Comment #303039

Fighting the deficit battle on the backs of the unemployed is truly depressing and revealing of our national priorities.

The financial sector and their investors received literally trillions of dollars in direct (TARP) and indirect assistance (Federal Reserve) to save them from liquidation.

Now, we get religion on providing a small fraction of that assistance on supporting the unemployed in a undeniably depressed job market.

Forget the economic arguments for extending unemployment insurance. Where is the morale outrage at saving the financial elites and letting the average Joe go bankrupt?

Eventually, this disparity will sink in with the voters. I just wish they would smarten up quicker.

Posted by: Rich at July 3, 2010 7:57 PM
Comment #303040

Rich-
It’s more than outrageous, it’s counterproductive if your real objective is the general health of the economy. If your objective was purely the creation of an economic aristocracy, the upward mobility of wealth, then of course there would be no problem.

Some people might think that the more efficient way to run an economy. They might think that letting all these folks in the lower quartiles and percentiles of the earnings brackets become more and more impoverished might lead to a more smoothly running, sustainable economy. The truth is, though, an economy works most efficiently when money flows freely. It’s hard to squeeze blood out of a stone, and the weight of such a top-heavy economy has the tendency to flatten the rest of the economy into a dense layer of mainly impoverished, less educated, less motivated worker bees.

America reached its prominence under a different system, and I don’t think that’s accidental.

Posted by: Stephen Daugherty at July 3, 2010 8:24 PM
Comment #303041

Stephen,

The results of “trickle down” and laisse faire economic policies are becoming increasingly apparent. It didn’t trickle down. It was invested in Chinese manufacturing companies. It was invested in speculative financial instruments. Middle class wages stagnated and jobs disappeared overseas. The average Joe was reduced and induced to taking on unsustainable household debt to maintain a consumer economy benefiting those that sent their jobs overseas. Like I said, at some point the middle class will begin to realize what has happened. I sincerely hope that it is not too late.

Posted by: Rich at July 3, 2010 9:07 PM
Comment #303043

I know it is important to left wing policies to say that things are getting worse. But they are not. I got my first full time, all year job in 1983. Of course my life has gotten much better since then, but so have the lives of most Americans. This is true even after the downturn.

I grew up in the 1960s. During that time a working class family, like mine, had a lifestyle - talking about the things you could buy - like a family living in poverty today. Many of the things now taken for granted by the poor, such as air conditioning, well-functioning vehicles, color televisions etc, we didn’t have. Of course, we didn’t have computers, VCRs or mobile phones. People I knew didn’t really take vacations and the only ones who had been to Europe or Asia had done so when their Uncle Sam drafted them. Our house and those of all the people I knew had only one bathroom, and most families had three or four kids to share it. Most bathrooms didn’t feature showers and if they did there would not have been enough hot water for everybody anyway. We had enough hot water to fill the bathtub once. You couldn’t do the laundry at the same time. Of course, our family had a dishwasher … me and my sister. Seriously, such things were luxuries of the rich and almost rich.

During that same period, world poverty has declined remarkably, as many other countries have opened their markets and their systems. I think this actually bothers some Americans. Others are getting richer too and that makes us RELATIVELY less rich, but we still are better off too. When I was young, most of the world’s people lived in despotic regimes. Half of the world lived under communist dictatorships. Many of the others were ruled by ordinary ones. This was true even in Europe.

I have been interested in environmentalist since before I can remember. When I was young, if you swam in lake Michigan, as I did, you came up greasy from the pollution. To get the the water, you had to cross a crust of dead fish and a little garden of seaweed. Now the same place is clean. I used to be able to tell the direction of the wind from the smell. North was the yeasty smell of breweries. West was the taste of steel. North was the the chocking smell of coking coal and south was ordinary coal smell. I read about lichens, but never saw any because the pollution killed them in my neighborhood. Today the air is clean and one of the biggest environmental threats are the growing deer populations.

My mother died in 1972 of a type of cancer that can be controlled today. My aunts and uncles expected to need false teeth by the time they were in their late 40s and when they were in their mid 50s, as I am now, they were old and worn out. Today I went running. I am much slower than I used to be, but I can still do it. One reason is improved shoes. When I was a kid, the running shoes were almost guaranteed to ruin your knees before you were forty.

Then there is diversity. In the 1960s, there was real prejudice. Our neighborhoods were segregated. We didn’t even think about it that we never saw any black people except when we went downtown. As I write this today, my youngest son is downstairs playing video games (a mixed blessing but also something we didn’t dream of having) with five friends. They seem to represent most major ethnic groups and none of them seems to think this is anything special.

We can argue about what has happened to our country and the world in the last thirty or forty years and who did what to whom. We all can point to things we liked better back then. But a lot of good has happened since then. My father was the same age as I am now in 1970. I certainly would not want to trade places with him. I would like to go back to that time as a tourist and to meet again the people long gone, but I certainly would not want to live there by their standards.

So we have had a downturn in the economy. I am afraid that Obama and the Democrat policies will weaken the recovery, but even if we stayed as we are now for a while longer, life is still better than is used to be. Unemployment is still lower than it was when I got my first full time job. America’s air and water are cleaner. Crime rates are lower.

Why don’t we do this? Why don’t we recognize that we have to deal with the recent downturn. But let’s not wallow is deceptive self pity and pretend that life is so hard for us. I think the problem is that anybody younger than around 35 or 40 does not remember a really bad economy, so they can be convinced that life sucks now.

Posted by: C&J at July 3, 2010 10:53 PM
Comment #303051

C&J-
In the sixties, when somebody talked about a computer, they were talking about something that could fit in a room. The PC or laptop you’re writing on would have been referred to as a minicomputer. Video recording units were seen in Studios.

I don’t doubt that we’ve made advances in both materials science and electronics. I don’t have to claim that we haven’t advanced on that front to claim that we have economic problems.

World Poverty has declined, and the Tyranny of Communism is a joke of what it once was. I agree. But the end of the cold war and the spread of economic prosperity does not bar the door on economic problems. In fact, it makes the capacity for them much greater. Just witness Greece’s issues with Goldman Sachs.

We no longer draft kids into our asian wars, we have them volunteer. But that does not change the way a dumb war can cause problems for our country, or a negligently led one.

And on the environmental front, we can have cleaner air, but still have problems. I mean, you’re right there on the Red Column bashing Obama over one of those problems, though I hardly think it wouldn’t have happened under McCain. That an all the people with flammable water, near where the Gas Companies have been drilling for natural gas.

And yes, we’re a much more diverse, much more racially integrated society. And many of your fellow Republicans can’t seem to stand it. Just look at some of their responses to Obama.

So, we’ve had a downturn in the economy.

Well, you talk about me not being old enough to remember the last time the economy got this bad. Maybe I’m too young to really remember it, but you, in turn, are too young to remember the last time this kind of event happened. This is something like what your parents went through, or their parents, at least. This mirrors more the economic problems of the 1930s than those of the 1970s.

And that’s the problem, and that’s why you’re not taking it seriously.

We don’t need more complacency. We don’t need more of a hands-off attitude. We don’t need to be kidding ourselves that this problem will resolve itself, and the people we kick off the rolls can just depend on charity. We need to put an end to this “Can’t be bothered” mentality in government. We need somebody up there moderating this economy, or these sickening rollercoaster rides will be the economic future we deal with.

Posted by: Stephen Daugherty at July 4, 2010 10:41 AM
Comment #303054

Stephen

Unemployment in the early 1980s was higher than it is today. We were coming off ten years of stagflation. The Obama folks keep on telling us that this is the worst downturn since the Great Depression. This doesn’t mean it is true. They often tend to overestimate their challenges.

I am not complacent about the economic problems we face today. But I do not think that most of what Obama is proposing will properly address the problem.

Government grew remarkably under George W. Bush. If we think this was a bad thing, why do we want to make it even bigger? If government under George W. Bush couldn’t make the right decisions, do you really think that an even bigger government under Obama will be so much better? Do you really believe that the problem with bloated government was the doing of only one man? Are there no organizational constraints? AND if you make it even bigger, what happens when Obama leaves office?

I am glad we agree that things have gotten much better over the generation. It is silly when people overlook all the progress. It is like that old saying, “Besides that, Mrs Lincoln, how was the play.”

Where we might disagree is re the causes of this progress. I think that we progress BECAUSE of our system. We have come to expect such progress, but it is NOT the norm. The communists countries produced almost no non-military innovations over the course of more than 50 years. In most human societies life just didn’t improve much for generations. The life of an Egyptian peasant wasn’t much different in AD 1900 than it was in 1900 BC.

Posted by: C&J at July 4, 2010 11:26 AM
Comment #303055
The Obama folks keep on telling us that this is the worst downturn since the Great Depression. This doesn’t mean it is true. They often tend to overestimate their challenges.

This is why the Republican party is dangerous.

Actually any economist worth spit says that is true.

I despise deniers of the holocaust, racism, scientific fact, and economic reality. Especially those who do it for political gain.

Posted by: gergle at July 4, 2010 11:39 AM
Comment #303057

C&J-
Obama’s folks are simply saying what’s true. If you look at the drop in GDP, it is the worse recession since the Great Depression. That’s empirically provable. I’ve offered up the rates, and the links necessary for you to see these facts for yourself. It’s also been accompanied by a failure in the financial services sector that we did not see in the last great recession.

Government grew remarkably under George W. Bush.

The problem isn’t that government grew, it’s that Bush debt financed his spending. As I linked here or elsewhere, you folks have counted on an unwillingness to raise taxes, and a dogmatic tendency to cut them to try and reduce government spending. But that didn’t happen, because for the sake of politics, Republicans don’t touch the big items, or control costs, or anything like that. They just complacently hope that taking money out of the revenue side will force spending cuts, and you’ll get your limited government.

It doesn’t work that way. All it does is defer the cost, and meanwhile, people don’t feel the hit, so even when you do periodically go in paroxysms of fiscal high dudgeon, the problems just get kicked down the road.

Personally? I think the constant worry about the size of government is just too abstract a concern to bother with. If you actually look at the budgets of the departments that do most of the “big government” functions, they’re not all that expensive to run, comparatively speaking. Meanwhile, most of the government your people added was entitlements, and defense. That’s where the big costs were, aside from your massive tax cut.

Really, our fiscal problem isn’t a big government problem, it’s a problem of having people who call themselves fiscal conservatives, but who have huge blind spots about dropping revenue, and waging wars and defending this country on credit. We have people trying to do math by way of political calculus, rather than good old fashion arithmetic. Your people simply don’t think systematically enough. That’s where our fiscal problems come in: faith-based budgeting.

As for the causes of progress, I think you’re dead wrong. We would not have seen the growth we’ve seen without the microchip. It created a new industry, new kinds of jobs, new kinds of efficiencies, and even now it props up and economy that otherwise would have faltered under the weight of debt and wage suppression.

Such progress will become the norm, to one extent or another, as the new sciences and new technologies develop, because each new generation of technology begets its sucessors. The microchip alone, has changed the face of many different kinds of research, quickening developments.

If you expect us to settle into a new normal, or are trying to force us to settle into one, you will find the forces of history fighting you every step of the way, and if history is any indication, your side will lose. The question only is, how many people will lose with you, before they reject your ideas as discredited.

It’s not bad to want to preserve old values, and good ideas from the past. In fact, I’m inclined in that direction myself. But what I have realized is, if you cannot preserve the context that made the current forms of the old ideas and values possible, then history will either force you to abandon old principles, or you will have to find a way to put old wine into new wineskins, to clothe the old ideas in policy designed to deal with the reality you’re faced with, rather than the one you wish you were faced with.

Don’t underestimate this recession. Don’t think that our troubles are over. If you want conservatism to last beyond the next decade, the last thing you need to be doing is trying to keep the old interpretations of it alive, because they have failed spectacularly, and will do no better now that the economy has broken.

Posted by: Stephen Daugherty at July 4, 2010 12:40 PM
Comment #303058

Stephen

Yes it was very bad that Bush grew government and borrowed the money to do it. We worried about it back then, but it looked like it was improving until 2007. Deficits were coming down and we had record revenues in 2006. We (I) was mistaken.

So what is happening now. Bush was wrong to borrow so much money and to grow the government so fast. Do we agree? So now Obama is growing both these things a lot faster. Bush said we had the emergency of 9/11 and the need to fight terrorism. He also said he was stimulating the economy. Obama has all sorts of emergency spending.

The scary thing is that the best of the Obama deficit projections (i.e. if everything works well) is higher than the Bush deficits. When does it end?

Re progress - What kind of system produces these kinds of advances and what kind does not. The U.S. produces way more inventions and innovation that our % of the world population would indicate. Why?

Re the microchip - there was a quip during the 1990s that you could find computers everywhere … except in the productivity figures. Experts have concluded that most of the productivity gains of the 1990s were due to better logistical arrangements. Technology certainly enabled many of these things. But computers and technology were available all over the world. How is it that productivity in the U.S. shot up, while the similarly situated EU nations dragged along?

When you look at the sweep of American economic history, you find a constant adaption and creation of innovation. There is something in the system that makes that happen. If technology alone was enough, all those Middle Eastern despots could have just bought the latest and surpassed us long ago.

Science and innovation are related but not the same. History is replete with cultures of failure, that had access to all sorts of technologies, but just didn’t put them together. Government plays a big role in financing research, but it is up to the people (i.e. the private sector) to turn science into innovation.

Government research and investment essentially created the Internet. But all the innovations that make it useful the work of the people. Government never would have created Google, Amazon or eBay.

I don’t expect to settle on a low “new normal” I think we will innovate our way out of this. But the old fashioned government management and the big spending ways of Obama won’t get us there.

Government should fulfill its role of protecting private property, ensuring the rule of law and providing the services the people cannot do for themselves. If governmetn had been doing a good job with its own Freddie and Fannie much of the sub prime problem would not have happened. Government does not have the capacity to manage wide scale innovation.

Think of Obama. He has much less scientific understanding than you do. He appoints political leaders largely on their political contributions and worth. Do you really think that someone like Ken Salazar or Janet Napolitano would get the jobs they got through merit? And do they spend most of their time running their operations of thinking about politics? This is NOT only Obama. This is politics. So the question is whether or not you want to trust innovation to politics.

Posted by: C&J at July 4, 2010 3:04 PM
Comment #303064

C&J-
Bush had a .3% recession that lasted eight months. Obama had to deal with a 3.9% recession that lasted nine months longer, and which we are not fully recovered from.

Bush could have easily asked for money through either offsets or through new taxes to pay for the programs and the wars. He could have just not given out the tax cuts, and saved a lot of money. It would have prevent a lot of inflation, to be sure, and that would have economically benefited the coutnry.

The problem with you trying to equate Bush with Obama is that I remember the statistics, and Bush created his mess with no real economic justification for it. His main justification was the Republican’s disingenous practices of trying to “starve the beast”, and their resulting bias towards trying to force spending cuts by causing deficits with big tax cuts. Why else would Republicans squander actual fiscal balance?

There is no indication they have learned the error of their ways.

As for the sub-prime problem with the GSMs, you’re missing one critical detail: during the build up to the housing crisis, the GSM’s market share on the secondary mortgage market was shrinking. It was the non-bank lenders that were both taking up more of the primary and more of the secondary market, and they, like the Savings and Loans of twenty years before, were not regulated like the banks they were acting like.

You focus on the GSMs as if they were a bad idea and were always a bad idea. You only omit several decades of stable increases in homeownership to come to this conclusion.

I don’t buy your “Government cannot innovate” argument. I would say that it can’t innovate like business, any more than business can regulate like government can. Each must take their own approach.

Your notions, which often exclude government from many spheres, are much more inflexible about such things than mine are. I don’t have your hang-ups about government, nor do I have what would be their complementary, if I were thinking merely in exact opposites: hang-ups about the absence of government. My philosophy is one of pragmatism.

I don’t support a second stimulus because I’m wild about deficit spending. I support it because I believe it will be much easier to be austere when it doesn’t get in the way of returning America to prosperity. Any fiscal measure that causes major financial distruption defeats its own purpose.

Posted by: Stephen Daugherty at July 4, 2010 8:55 PM
Comment #303066

Stephen

I wrote a rambling post on the the other side re what we were talking about.

The bottom line in the discussion here is that Obama is spending a lot more than Bush and a lot more than any president in the history of the world. You trust him to do this. I don’t. I don’t trust anybody to do that and I especially don’t trust someone like Obama whose first executive job was president. We disagree.

Posted by: C&J at July 4, 2010 9:57 PM
Comment #303070

C&J-
He is spending mainly what Bush obligated him to spend, obligations that are not lain down easily. I want him to see what he can do to resolve the fiscal problems, but I want him to do it right, not according to some political dogma that is misapplying basic monetary economics, getting the whole damn thing backwards.

Unless you guys recognize what kind of situation you are in, I don’t see the point in the critique. When FDR and Hoover tried to be austere in such environments, it didn’t reconcile the budgets as hoped, it worsened the Deficits because the economy was a more primary problem.

That’s why I’ve made the comparison in the past, saying that the Republicans are replacing the spark plugs when they got a dead battery. Fiscal policy to close deficits is useless if the economy is unable to provide the cash flow necessary to replace government funds or the taxes levied cut into money needed for the kind of economic activity that fuels revenues.

Posted by: Stephen Daugherty at July 5, 2010 12:11 AM
Comment #303072

Stephen

Please read what I wrote mostly for you on the other side. I am not blaming Obama - although I have little confidence in his abilities. No matter whose fault it is, the solution to the biggest spending & borrowing government in the history of the world cannot be more borrowing and spending.

When FDR started spending, the Federal role in the economy was very small. Today it is very big. I know I repeat this often, but it remains true the difference between a live-giving medicine and a lethal poison is often in the dosage. Beyond that, if Bush pumping in X amount of debt financed government expansion was already bad, how can Obama’s 3X amount of debt financed government expansion be good?

Re your Depression analogies, besides the relative size of the Federal government, then and now, what the government SHOULD have done back then was expand the money supply. The Federal reserve failed to do that back then and that is the proximate cause of the depression.

The Fed has been loose already with money supply. In the case of actual deflation as in the Depression) the Fed can essentially print money. We are no longer tied to the gold standard and our debt is in American currency. This would not be a good outcome, but we always have that tool available that no others do.

In fact, I suspect that this will be the end-game. After Obama has spent and borrowed more than anybody can repay, we will move into the stagflation stage. It will be like the 1970s on steroids.

Posted by: C&J at July 5, 2010 12:39 AM
Comment #303080

C&J-
Stagflation. Which is defined as high inflation and high unemployment, all at once.

Well, we’ve got the high unemployment, sure enough, but if the economic actually tripped towards inflation, it would be a good thing. Higher prices would mean more money to put in employee’s pockets, and it would mean that the economy would grow out of its current doldrums.

Trick of course would be avoiding higher than necessary inflation on the other end. But that’s a bridge we should cross when we come to it.

Deflation, if its allowed to continue, will make it more difficult to reduce that ratio you’re so worried about.

The GOP is prepared for the wrong economic crisis at the wrong time. The main reason we had to deal with stagflation was a wage price spiral. Well wages are going down, and your people are making sure they’ll go down even further. You won’t have to worry about stagflation at that rate. You’ll just have to worry about recession and depressions on your own watch. This is not the early eighties. It’s time to realize that.

Posted by: Stephen Daugherty at July 5, 2010 2:31 PM
Comment #303253

While some people prefer to wallow in the blind, circular partisan-warfare, incumbent politicians still enjoy 90% re-election rates, and it’s largely because there are rarely any challengers from the same party. So the incumbents are repeatedly elected, and re-elected, and re-elected.

And things continue to deteriorate.

Funny how the IN-PARTY and their blind loyalists always try to twist the facts to try to make THEIR party look like they’re making progress, and the OUT-PARTY and their blind loyalists do their best to thwart progress to make the IN-PARTY look bad, and BOTH act like they never engage in such behavior.

Funny how the blind party loyalists whine and scream “bloody murder” when the OTHER party does the very same things THEIR own party did when they are the IN-PARTY/OUT-PARTY.

Funny how the blind party loyalists truly believe there is any real difference of any significance.

The fact is, most (if not all) incumbent politicians in BOTH main parties are FOR-SALE, incompetent, and/or corrupt.

There’s really no important difference between the majority of incumbent politicians in the duopoly. Beyond each of their equally destructive extremes, incompetence, greed, and corruption, there’s simply no difference, and the evidence of it is the deterioration of this nation and a growing number of constitutional violations for the past 30+ years.

But the blind, party loyalists (the majority of the voters that bother to vote) still prefer to fuel and wallow in the circular partisan-warfare.

Never mind that insanity is defined as doing the same thing over and over, while expecting a different result.

The majority of voters are actually getting their badly needed education, and the majority of voters mostly only have themselves to thank for their own predicament.

What will it take to dissuade those who prefer to cheer-lead for THEIR party, cheer-lead for THEIR politicians, fuel and wallow in the partisan-warfare?

Repeatedly rewarding failure, incompetence, greed, and corruption, and fueling and wallowing in the blind, circular partisan-warfare will almost certainly lead to more pain and misery. The majority of voters are reaping what they’ve sown, and it’s not going to get much better for many years. Sadly, they’re also stealing their childrens’ futures too. But that growing pain and misery is the potential built-in self-correction mechanism (provided enough voters get their education soon enough).

Now, let’s see … Who will be offended by these axioms?
Who will claim they don’t fuel and wallow in the partisan-warfare?
Who will steadfastly assert that THEIR party is better, and there really are significant differences between THEIR party and the OTHER party?
Who will refuse to see how they’re being used, turned into partisan cheer-leaders, and blind to the minor differences and over-whelming similarities of deeds of both the IN-PARTY and the OUT-PARTY?

With 90% re-election rates for Congress, and BOTH parties taking turns at being the IN-PARTY and OUT-PARTY, what are the significant differences with either that matter?

At any rate, the majority of voters have the government that they elect, and re-elect, and re-elect, … , and re-elect (and deserve), at least, until repeatedly rewarding failure and repeatedly rewarding FOR-SALE, incompetent, and corrupt incumbent politicians with 90% re-election rates finally becomes too painful.

Posted by: d.a.n at July 8, 2010 8:51 PM
Comment #303255
Stephen Daugherty wrote:Well, we’ve got the high unemployment, sure enough, but if the economic actually tripped towards inflation,…

We already have inflation, and have had positive inflation every year for the past 55+ years, which is why a 1950 U.S. Dollar is only worth about 10 cents.

Who really believes inflation is currently only 3%?
Who really believes unemployment is only 9.5%?
Who really believes GDP is currently 2%?

The one statistic the government has trouble lying about is the U.S. Dollar. It ain’t easy to hide the deterioration of the U.S. Dollar over the last decade.


Inflation erodes earnings and savings.
What’s good about that?
What is the net benefit from inflation?
At best, it’s like squeezing a balloon, where the problems are merely shifted elsewhere.

Other than that, everything is rosy!

At any rate, the majority of voters have the government that they elect, and re-elect, and re-elect, … , and re-elect, at least, until repeatedly rewarding failure and repeatedly rewarding incumbent politicians with 90% re-election rates finally becomes too painful.

Posted by: d.a.n at July 8, 2010 9:09 PM
Comment #303330

dan-
First, not all inflation is bad. It’s a normal part of a growing economy. When the percentages get high, of course, it becomes a problem, but not until then. Right now, we could use a little inflation because our economy experienced it’s worst peacetime contraction since the Great Depression, and for much the same reason: the failure of bank financing for consumer and producer spending, for business startups and payrolls. For eight months last year, the economy was actually deflating. The inflation percentages were actually negative.

Deflation erodes jobs, erodes earnings, erodes savings, and makes loans harder to pay off.

Inflation WILL become a problem but only if we get far enough out of our current situation for it to actually be an issue.

It’s time to stop treating this crisis as if its anything like most recessions in the past half-century. It is nothing like them. If we treat this like an inflationary recession, the policy mistakes are going to hurt.

Posted by: Stephen Daugherty at July 10, 2010 12:02 AM
Comment #303350
Stephen Daugherty wrote: First, not all inflation is bad.
Why?

I wonder if some people have really ever thoroughly though that through, or whether it is something they heard once, and therefore, feel like it must be true??

Your comment above was not merely something like “some inflation is not so bad”, but you wrote “not all inflation is bad”, which means that you believe there are some forms of inflation that provide some sort of net benefit.

Stephen Daugherty wrote:It’s a normal part of a growing economy.
Normal does not equate to “not all inflation is bad”.

There is no net benefit to inflation or deflation.

But, if you believe differently, prove it.

If high inflation is bad, then how is a little inflation good?

Saying something is true, and proving it are two different things.

But if you want to try to prove that inflation is never bad, then have at it, because that will most certainly be yet another entertaining pretzel imitation, fraught with prolific, circular obfuscation and gobbledygook.

Saying “a little inflation is not bad” is sort of like saying “I’m only bleeding a little, which is not bad”.

Sure, inflation affects imports, exports, interest rates, and other economic variables, but there is no net benefit from inflation.
Destroying a currency, on the whole, has no net benefit to most citizens.
Destroying the value of anything that is valuable, rarely (if ever) provides any net benefit.
And what is the primary cause of inflation?
It is primarily caused by creating excessive new money (created out of thin air; as debt).
It is partly caused by massive borrowing that increases the money supply, but that increases the debt too, which comes with a price later.
And massive debt has significant dangers too.
If nations would borrow and spend their way to prosperity, then Greece would be the richest nation on Earth.
Some debt is not terrible, but it is not free, and like inflation, the larger it gets, the more dangerous it is (especially when you have BOTH high debt and inflation).
Whether there is ever any net benefit from debt depends on how wisely it is spent, or invested.
But how does inflation provide any net benefit, when it deteriorates the wages and income of most Americans?
Who benefits most from inflation, and why?
Look to see who it benefits most, and you’ll see why there’s so much of it.

Stephen Daugherty wrote:Inflation WILL become a problem but only if we get far enough out of our current situation for it to actually be an issue.
It already is a problem.

Inflation is destabilizing, and shifts wealth from the many, to a few.
The larger it is, the worse it is.
It erodes wages, which most Americans depend on.
It benefits people who have huge debt, but ONLY if they have the income to pay down the debt.
But with record-high of foreclosures and bankruptcies, and high unemployment, few are benefiting from their debt.
The massive $13.2+ Trillion federal debt is too large to reduce by high inflation.
There is no net benefit to inflation.

Also, inflation is actually much higher than what the government reports, because they fudged the inflation calculations twice (in year 1983, and in year 1998), such that a lower weighting was applied to CPI components that were rising in price, and a higher weighting was applied to items falling in price. That smoke and mirrors to resulted in a reduction of the reported CPI on an annual, and year-over-year basis (by about 2.7% per year) from what it would have been based on the traditional weighting methodology. As a result, the compounding effect since the early-1990s has reduced annual cost of living adjustments in Social Security by more than a third. And as time goes on, the error is compounded and grows larger.

Also, while the federal government and federal reserve can lie about inflation rates, GDP rates, unemployment rates, and the money supply, the can’t hide the decade-decline of the falling U.S. Dollar.

And when and where did I ever say this wasn’t a crisis, or only an ordinary recession (“like most recessions”)?
Where do you come up with these strange conclusions?

I think you are somehow trying to defend the wasteful spending, massive and growing debt.
And if you don’t think there’s a lot of wasteful spending, there is ample evidence to prove there has been a lot of wasteful spending.
And if you don’t think the debt is at a dangerous level, there are numerous reasons to prove it is at (if not beyond) dangerous levels.
Simply look at the dozens of other nations that tried to spend and borrow their way to prosperity.

At any rate, the majority of voters have the government that they elect, and re-elect, and re-elect, … , and re-elect, at least, until repeatedly rewarding failure and repeatedly rewarding incumbent politicians with 90% re-election rates finally becomes too painful.

Posted by: d.a.n at July 10, 2010 1:34 PM
Comment #378548

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