Republicans & Conservatives Archives

Good Post,

Just one question:

What is the difference between the false choice between doing nothing and waste, and the false choice you present?

The Obama Administration knows that the economy will eventually recover.

Did anyone know that in January? Is there no reasonable in between from recovery by fall 09 and the next Great Depression?

Y’all made some good points, and then you went one step too far and made a joke of your own post.

Gergle

The President in his speeches set up that false dichotomy. There are those who would do nothing, the President repeated.

We spent billions to stave off the fall. The Fed pumped in money. Those were the right things.

I do believe that reasonable people knew the economy would recover back in Jan. Economies always recover. By Jan 2008, we had already taken most of the steps necessary. Those are the things that are bringing our modest recovery now. But in the hysteria of the time, the Congress and the Administration doubled - tripled - down. That money was been less well spent or wasted. AND it is all borrowed money.

Take the “cash for clunkers”. It just moved purchases from one quarter to another.

BTW - the Great Depression thing is overdone. This recession is a lot like that of the 1980s. Unemployment is still lower now than it was then.

But speaking of the Depression, economists still argue whether the New Deal helped solve or helped deepen the recession. We just do not know HOW to use government to fix the economy, except in the stabilization such as the first stimulus and the Fed did.

Christine and John,

So the numbers of jobs are a little off. Given that there are 10,289 projects around the country, give or take a few as of this month, bookkeeping errors are sure to be a factor as they are in all businesses, including the governnment’s bookkeeping.

What I find interesting is that a Republican dominated government like Texas, which has 424 Stimulus Bill projects underway or about to start, has REFUSED to post any notices at these projects indicating that these are Recovery and Reinvestment Act projects and dollars. I know this is the case because I discovered the road widening project in front of our homestead was a Stimulus Bill project from the workers working on it. But, no signs. When I contacted the TxDOT, they informed me that the Federal Gov’t. didn’t require such postings so Texas is going to take those billions from the Democratic Stimulus Bill but hide the fact from the Texans interfacing with those 424 Infrastructure projects EMPLOYING thousands and thousands of Texans, who otherwise would be unemployed NOW.

I don’t care if 10% of those 10,289 projects are mislabeled or recorded, or if the employment numbers on those projects is off by 10%, the bottom line is those thousands of projects are employing 10’s of thousands, and millions more are being employed off those project workers consumption, as a result of the Stimulus Bill, which so many Republicans are benefitting from while trying to trash the Stimulus Bill out the other side of their mouth, as is the case in Texas.

Christine made the ILLOGICAL statement: “I do believe that reasonable people knew the economy would recover back in Jan. Economies always recover.”

First, I am a reasonable person as most wall st. investors are, and NO, they nor I believed for an instant that the recovery was forthcoming in the absence of government intervention. So, your argument that anyone who didn’t think the recovery would have happened without government intervention is UNREASONABLE, simply points to the unreasonableness and illogical nature of your statement.

Second, Economies always recover is ALSO an illogical fallacy. Ancient Rome’s economy failed. Japan’s economy has struggled for more than 10 years to recover. Brazil also had more than a decade of exteme hardships from debt and hyperinflation, with no recovery without Monetary Fund intervention, and changing their inflationary policies in order to get that Monetary Fund assistance.

The 1930’s government intervention was insufficient to recover the economy. It took the Government spending like there was no tomorrow during following the attack on Pearl Harbor, employing not only all the men, but, large numbers of the women not previously in the work force, to truly bring the economy back onto its feet again by the late 1940’s.

Arguing that recovery would take place regardless of what government does, implying that without intervention no more suffering would occur than with intervention, is pure poppycock. In a supply side contraction of economic activity, freeing up capital and tax cuts will hasten the recover. In a demand side contraction of economic activity caused by unemployment and fears of income drop, creating jobs will not come from the private sector in the absence of demand, and therefore, must come from government job creation stimulus.

Republicans COMPLETELY FAIL to acknowledge data which undermines their political rhetoric. For example: The Recovery Accountability and Transparency Board released reports detailing how and where stimulus dollars were being spent. According to data released on Friday, Oct. 30, the answer is roughly 640,000, with the White House claiming closer to one million. However, this figure is only the new jobs created by the Stimulus Bill projects, and DOES NOT reflect the several million jobs which were saved by the consumption behavior of those 640,000 employed by the Stimulus Bill’s projects.

In other words, it is a safe estimate that without the Stimulus Bill, the unemployment rate would be more than double what it currently is. We are after all, a predominantly service oriented economy, which means one person working supports a minimum of at least 3 others keeping their jobs or, moving from full-time to part-time. It is the compounding effect on labor hours supported by the consumption of one employed worker in service economy. Those paying their mortgages and credit cards because they are still employed are keeping millions of others employed processing those mortgage and credit card payments, and all the other jobs those lending institutions require to operate all the way down their salary ladder to the indispensable janitorial staff.

Let me close by pointing to today’s NY Times Article entitled: New Consensus Sees Stimulus Package as Worthy Step .

That consensus is amongst economists, and the article also reports: “Economists said Republicans’ recent proposals to rescind unspent money would be a mistake.”

There is your opinion, which you have every right to, and then that of those with education and expertise in this field who run the numbers and take all the data into account as part and parcel of their considered opinion.

David

You are making the Obama false dichotomy. No serious person was advocating no government intervention. I explained that we had ALREADY made significant government moves by Jan 2008 and more could be useful. BUT most of the Obama stimulus was misdirected, misspent and too expensive.

The difference between a life-saving medicine and a deadly poison can be in the dosage. We need some government; that does not mean we always need more. It also depends on how things are used.

I don’t believe unemployment would be double. Even during the Great Depression unemployment rarely reached more than 20%. But I agree that the first stimulus helped save the economy from further drops.

The Obama stimulus, however, “created or saved” no more than 640,309 jobs (Obama is stuck by that reality thing again), and even those figures are doubtful and dishonest. The second stimulus was largely misspent and will come back to cost us even more in terms of weak recovery because it is all borrowed money. Look at the deficit charts. Obama has tripled it. He told us those expenses were needed. We are finding out that he over used the credit card and got not too much for the money.

BTW - Roman history lasted more than 1000 years (more than 2000 if you count the East). When did their economy fail and then fail to recover? Maybe it was when the Emperor Diocletian imposed strict government management, imposed price and wage controls and debased the currency. Maybe we can learn from the Romans.

Your view of the economy is too static. A person who has a job pays other people, who pay other people in turn. Economic wealth’s value increases as it is circulated. It decreases when it pools up in certain sectors and goes nowhere else.

Therefore, the generalized nature of the programs in the stimulus package.

Therefore, the stimulus packaged being aimed at the Middle Class, aimed at jobs, instead of tax cuts to the rich, which is the Republican’s alternative.

Therefore, the spread out stimulus, not just the money dumped in one place, in one sector, at one time.

The economy can recover on its own, to a certain extent, but what Republicans are asking of it would mean a far deeper hole to dig out of.

The trouble is, when all that demand suddenly disappeared in the wake of the credit freeze and the banking sector collapse, the folks who depended upon that demand for their incomes and jobs didn’t simply go away. The economy is being forced through the painful process of deflation, of not enough dollars chasing too much goods.

The stimulus was meant to replace that lost demand, enabling the markets to heal having gone down to it’s knees, rather than from flat on its face. The Republicans don’t understand this because the rank and file has been fed on this myth that the economy centers around rich people and how much tax they pay. The investor and the CEO has been given primacy in who we help to help the economy.

That’s why we are where we are now.

The system collapsed because it was a system built to make rich men richer by squeezing consumers as dry as possible. Hence easy credit and high endebtedness per person. Hence that self-indulgent, incestous tangle of speculation and hedging.

The idea, of course, is if you let the businesses make as much money as they want, more people will get employed. What has happened instead is that a few have gained more, and the consumers who have been asked to bear the burden of keeping economic growth going have seen their finances strained to the breaking point, and in many cases beyond. The trouble, really, is that to do this, the economy needed to be built on greater and greater layers of economic fiction.

I would not say that deficit spending in order to push an economy out of the doldrums is always a good idea. If it weren’t for the historic depths of the problem, I wouldn’t have Obama or myself for that matter turning our back on our assertions that we must get the deficit under control. But as I understand it, if we fail to get the economy back in good enough shape, the economic losses will drain whatever means we have of fighting the deficit, revenue-wise, anyways.

And it won’t necessarily help, in this kind of market, where we’re at, to either raise taxes or cut spending, because that means you’re having to take the money from somewhere else, in an economy that’s having trouble getting people to pay for things in the first place.

We can use the old emotional blackmail line about what we leave to our children, but if the economics simply don’t work that way, it’s just rhetoric, and doing what the Republicans want will simply make things worse for those children, rather than better.

Stephen

First stimulus (Oct) = good
Second stimulus (Feb) = mostly wasted

The second stimulus was not aimed at the Middle Class. It was just aimed … nowhere. Seems the rich guys are doing okay now anyway, BTW.

Don’t you think the largest deficit ever by any nation in the world and the deficits about the same as % of GDP when we were in the middle of WWII are a cause for great concern?

The money is all borrowed and has not been well spent.

If you want to help jobs and the middle class (whatever that means these days) just lower the payroll tax. This is a tax cut that will help the poor more than the rich. Use some of that unused stimulus money for that. We don’t need the government to spend more money. We have already done more of that than anytime in our history. We have to give the American people the capacity to spend money.

Christine-
First, I addressed your claims about the deficit a lot earlier. As it breaks down, more than a third of this deficit comes not from spending, but from the failure of revenue that the economic crisis brought on.

Another third is Bush Administration spending. An additional twenty percent comes from programs, like TARP and others that Obama continued from the Bush Administration by choice.

Only Ten percent of the current deficit can be hung around Obama’s neck. Seven percentage points of that are the stimulus.

The remaining part? The three percent that relates to the title of that entry of mine.

Obama’s been much more careful about deficit spending than his predecessor. One thing to keep in mind about the sudden rise in the numbers, is that Obama’s budgeting includes the hundreds of billions of dollars going to the wars that Bush’s budget tended to leave off. So the irony here is that Republicans are sort of punishing Obama for his honesty, for writing on the budget the things they left off the budget.

Is that the way you want conservatives to win? By being the better, and more willing liars?

As for Rome?

There isn’t merely one economic explanation for what happened with Rome.

My sense? Empires are difficult to keep together, and the constant struggle to keep things together requires resources. Rome never put together a sustainable basis for its continued existence, and it wasn’t shy, according to historical accounts, about sucking its provinces dry.

The thing to consider about modern day America, I think, is that political orthodoxy is leading us to blind ourselves to the necessity of setting a sustainable tax policy, one not so high that it drains the economy, but not so low that it cannot sustain the government services that it would be politically unlikely to do away with.

I’ll tell you this: under normal circumstances, running deficits as a way to starve the beast is a terrible idea. When people do not feel the effects of increased government spending in their pocketbooks, they don’t really make choices about what their priorities are, and not making such choices, lose the experience in dealing with the tough choices, and making them right.

Bush could have justified the spending decreases better if taxes, not deficits were funding them.

Unfortunately, this would be the responsible way of doing things, and I think, for far too long, there has been a strain in American politics of dumping the burdens of the public good aside for the sake of individual self-interest.

I don’t think you’ll like what I have to say next, but I guess you should anyways. The Republicans have made their political success off of both mooching off the government out of self interests, and of letting taxpayers, at least in an immediate, right in their face fashion, off the hook for the bill.

I don’t think we get out of our current economic problems, or our long-term fiscal problems without facing up to the fact that some sacrifices will have to be made. The question is what we treat as a luxury to be carved away.

Some want the corporate welfare and tax cuts for the rich to be that fat that’s cut away. But those people have big lobbying firms on their side.

So guess whose needs, like Healthcare, a fair shake in the market, and protection from environmental degradation, get made out to be luxuries, boondoggles?

Christine-
Convenient that Bush’s stimulus is good.

Actually, the results are mixed. The good thing is that the Banks are still there. The bad thing is, they aren’t lending, and that is contributing to our economic stagnation. The rich, mysteriously enough, like to keep their money.

As far as lowering the Payroll tax, you’re robbing Peter to pay Paul. That’s part of what supports our entitlements. The better idea may be to get the rich to eliminate the cap that keeps rich people from paying the proportion of their income that poor people do.

Anyways, how does a tax cut on income help people who don’t have taxable income?

I just get the impression that your people are kind of one-note on the economy. You don’t consider things in a really systematic way, and you try to apply the same solution to every problem.

You guys are suggesting for us to everything that Bush tried in order to get a slumping economy to perk up. We need something more sustainable than this strategy.

Stephen

The payroll tax is essentially a tax on employment. A cut in the payroll tax makes it cheaper to employ people and lets poorer workers keep more of what they earn. This cannot by any stretch of the imagination be called a tax cut that benefits the rich. It goes directly to the poorest and middle class wage earners.

Re Rome –don’t try to give me the Wikipedia explanations. I wasn’t trying to explain the whole of the Roman Empire. I was merely pointing out to David that there were thousands of years of history to consider. It is indeed complicated. Your statement that Rome was not sustainable is interesting. The Romans dominated their world for around 700 years. The Empire in the East endured another thousand years after that. In the end, NOTHING is sustainable, since nothing lasts forever. Do you know of any state you would call sustainable?

Re Obama’s deficit – it is his now, no matter what. He can claim that he inherited the problems, but now it is his to solve. I am sure we could quibble about your figures (BTW – I have seen similar analysis about how much of the deficit President Bush was responsible for in his first years. It is remarkable how the same arguments can be used by all side, since all politicians behave in similar ways), but let’s take them as they are. Your say that president Obama added only around 10%. Added 10% to the biggest deficit in the history of the world after only nine months in office is quite an accomplishment.

Re Stimulus – the first stimulus was not a “Bush stimulus”. It was bipartisan, rather more Democrats than Republicans, since Democrats controlled congress back then too. Both parties can take credit. We should have waited for it to work instead of piling more spending onto it. With such rapid and large spending comes much corruption and waste. Stories of this will come to light and will certainly be used against the Democrats who demanded the spending. You might consider that unfair, but that is the nature of being accountable.

I know you enjoy stereotyping as “you guys” but in this post I have acknowledged the need for government intervention, suggested the use of monetary policies, advocated a cut in payroll taxes and given credit to Democrats for the first stimulus. The only thing that you advocate that I don’t is wasteful spending.

Christine said: “BUT most of the Obama stimulus was misdirected, misspent and too expensive. “

First of all, it WAS NOT Obama’s stimulus alone, but, compromised mightily by your and my, and every other person’s Congressperson looking to bribe some more constitutents back home for reelection in the future.

Everyone who spends enormous sums of money is going to misspend some of it. That is true of our Financial institutions, Corporations, and yes, more small businesses than you can shake a stick at as evidenced by their default rate in the first 3 years of start-up. So, your point is? And you will need to be specific. These generalizations don’t speak to anything except partisan bias toward the party in power.

What was misspent, how much was it? Then we can debate whether an inordinate amount was misspent, and who is responsible for it. Any president worth his salt facing the economic downturn Obama did in February, would have rationally and reasonably accepted a stimulus bill that could be enacted soon, over a perfect bill that might have taken 6 months or more to craft and pass, if it could pass Congress at all.

Too Expensive? How so. What is saving an economy from tanking or a depression worth in stimulus dollars?

My wife is pretty damned glad the recession did not get worse, as her job at an insurance company was kept through it all. Had the recession deepened further, that might not have been the case as folks will drop insurance coverage like a hot potato when unemployed or faced with dramatic cuts in earnings. And she and I both are grateful to Obama, the Congress, and the American people for taking those steps to keep her, and 10’s of millions of other Americans in their jobs through this debacle of government and the Wholly Greedy Private Corporate Sector.

Ownership society Bush and Greenspan touted. I will clue you, there are whole helluva lot less owners today than when Bush took office. That’s Republican ideology for you. Not that Democratic ideology is any better, but, they do seem to spend a lot of their time in the majority cleaning up after Republican rule. So, they deserve a few demerits removed from their side of the equation.

Republicans majorities created this doubling of the national debt, mandated the costs of economic recovery to Democrats, refused to touch the health care economic crisis when they had the power to do something about it, lacked the political courage and practical ideas to reform entitlements, choosing to expand them instead. Republicans stripped down manpower in the IG’s offices, and stripped power and directives from oversight and accountability offices within the Executive Branch, leading to a trillion dollars or more in waste, fraud, and abuse under their rule, all added to the national debt by their refusal to raise taxes and pay for what they spent.

And now, 9 months after Obama is elected, you want to fault him for the federal government’s emergency actions to save the nation and economy from Republican mismanagement and wreckless governance? Free country. You are entitled to your opinion.

Stephen D. said: “Economic wealth’s value increases as it is circulated. It decreases when it pools up in certain sectors and goes nowhere else.”

Or is shipped overseas by the cargo ship loads to Iraq and Pakistan achieving nothing but entrenching the concepts of bribery, corruption, and waste of American tax dollars.

David

It seems to me that the second stimulus need not have been so large. I suppose that economists will debate this for a long time, just as they still debate the Great Depression.

What will become clear over the next months will be the extent to which money was diverted, wasted or just plain stolen. The Obama Administration’s claims of jobs “saved or created” is not encouraging so far.

President Obama was elected because he was not Bush and he convinced more than 50% of the voters that things would be different. Things are indeed different, but maybe not better.

The “blame Bush” idea is already past its expiry date. And if you look at deficits, they were declining until 2007, the year the Democratic majorities took back both houses of Congress.

The political climate is once again changing.

I’m just not as smart as you phd’s in economics, but why did the MSM tell us our economy was going down the tubes when Bush was president and unemployment was 4.25%; and yet now the MSM tells us of the great recovery from the brink of a depression, and the unemployment is 10.2% (actually 17%) under Obama? Also, why is recovery starting to take place in other countries, but not in America?

If you want to see graphically how much President Obama will grow the deficit, take a look at this link.

It is true that Bush and the Republicans (and Bush and the Democrats after 2007) spent way too much. But Obama and the Democrats are making that spending look like small potatoes

Obama’s deficit for 2009 quadruples Bush’s 2008 and you notice the projected deficit begins to climb when the national healthcare starts. The deficit will naturally drop between now and then because the taxes start right away, but no coverage until 2013-2014. Disgusting way to run the books, isn’t it? Of course th CBO is taking into account the cuts in medicare spending, by the way, has congress ever actually cut medicare benefits?

propitiation,

It could be that the MSM sucks in financial news. Always has. Americans in the mainstream won’t watch real economic news. It exists on the internet and even to some extent on bloomberg/CNBC/, etc.

Proptiation,

At the bottom the site even the Heritage Foundation gives equal billing to 2009 to both Bush and Obama. The problem with this biased site and chart is that it only looks at deficit, not revenue or spending.

Christine-
They cap the amount that rich folks have to contribute out of their own checks, so they pay less and less of a share of the tax as things go up.

Much as I would like a light burden for the working class, since that’s probably the biggest tax I pay, the problem would be that this would worsen the fiscal situation with our entitlement programs. Unlike you, I do not see tax cuts as a free way to stimulate the economy, not when rates are low and the downside of the cut greater than the benefits.

As far as rome goes, the imperial days of Rome start at about the mid point, and between that and the fall of the Eastern Roman Empire, you start to see Rome fall from its prime. Heck, the very existence of Constantinople should tell you something is up, because it indicates that the sustainability of administration over the Roman empire, after a certain point.

It’s existence was never a really peaceful one. They always had borders to defend, and more than their own share of internal civil unrest.

America has existed for over two hundred years, with one civil war. I challenge you to find a period in Rome’s history that long where such peace ever was granted to the nation.

As for what you call the first stimulus, it wasn’t a stimulus, it was a rescue plan, a bailout plan. it wasn’t about creating growth again. It was about preventing our economy from absolutely collapsing. We passed it, but only after nearly every Republican, and a few Democrats made fools of themselves to make political statements.

The irony of your talking about a first stimulus was that a five-hundred billion dollar something stimulus package in fall or winter of last year might have headed off the need for greater stimulus, further down the road.

A stitch in time saves nine: a concept Republicans should post on sticky notes over their computer screens. If you want cheaper bailouts, cheaper stimuluses, cheaper healthcare, you don’t wait until the problem becomes catastrophic, and the momentum of events becomes difficult to divert. You take care of the problem early, so it doesn’t overwhelm you.

Unfortunately, the Republicans have an ideological block on this. And that usually continues until something so serious occurs, that if they continue their inaction, they’ll get destroyed in the next election.

As for stereotyping? Well, I have an affection for distinguishing between the singular “you”, and the plural, so when I talk about people as a group, I like to use “you guys”, or “y’all” to make that distinction. But also, I’d tell you this, if you go to such great lengths to have a party that does everything together, that makes constant party-line votes, where we don’t have regular and robust critiques of extremist rhetoric coming from folks in the party, then you can’t expect the distinctions of your policy to be easy to discern. Like my professor says, “a difference, to be a difference, has to make a difference.”

Republicans don’t differ with one another enough for people to differentiate between them. Should we be faulted for lumping together those who do not stand apart?

propitiation-
First, I regularly hear about disappointing economic news and the political problems that high unemployment pose for Obama from the mainstream media, hell from MSNBC. So your premise is false, possibly the result of listening to far too many people who make complaints about the mainstream media a substitute for actually addressing the issues it brings up.

Second, read these numbers. blame is convenient, but the housing crisis built up before the Democrats took back Congress. The failures were beginning to compound in the early part of that year, and the economy started losing steam on growth even as the party was just getting started in charge.

As far as deficits go, I explained what Obama’s actual share of that is, and I pointed out that Obama’s actually running the books more honestly than Bush did. If you folks were running the books honestly, you wouldn’t have been treating the wars we’re fighting as off the book items. That alone constitutes several hundreds of billions of dollars that your administration concealed off budget.

As for where the spending cuts for Medicare are coming from, they’re coming mainly from unneeded subsidies to the insurance companies that were being paid to the insurance companies to run Medicare for the Government.

It wasn’t going to healthcare costs. It would have been cheaper when the Republicans were formulating that plan for them to have included the supplemental plan as part of government run medicare, but Republicans decided somehow that the cheaper, more efficient way to do this, would be to duplicate those functions among a myriad of insurance companies who charge more to do it.

Go figure.

Propitiation-
The reason for that climb is not healthcare. It’s the deficit spending. I think I explained this a while back, but maybe you need some good shock treatment here.

You see, when Bush told you he was putting their money back in people’s wallets, he lied to you. He failed to make you fully aware of the arrangements for his extention of credit to you for the government services his administration provided.

You see, when he decided to spend out of a deficit, every dollar he gave you came from a loan he made in your name. That’s what the Chinese and Japanese own so much of. When Republicans bellyache about the Chinese calling in those debts, it’s their debts that will be called in first.

The Bush tax cuts, trillions of dollars worth, were mostly loans from the Chinese and other foreign countries that Americans will have to pay back. We’ll have to pay all that money back, with interest.

Go back to telling us what terrible harm we’re doing to our children’s future, while we try and unravel the second worst economic collapse of the last century. Isn’t it funny? Republicans get control of both houses and the Presidency, and within that same decade, the national debt drastically increases and we see a catastrophic economic collapse just like the one they had when the Republicans last had that kind of power.

And why not? Republicans spent the last several decades doing their best not to learn the lessons of the Great Depression, since that would mean alloying their principles with the Democrats’, whose practices actually worked. The Republicans have spent far too much time trying to vindicate themselves of their party’s worst mistakes, with the ultimate effect being that they repeated them all, and even some of LBJ and the Southern Democrat’s mistakes for good measure.

I don’t know where exactly the Republican Party goes from here, but it’s got to stop being the party that just takes the opposite policy position from the other party. The Republicans have to free their minds so that their members can come up with the new conservatism for themelves.

Or put another way, The Democrats elected their maverick, the Republicans forced theirs to be a doctrinaire dogmatist.

And now what are the Republicans trying to do? Block anything from the other party that deviates from their dogma.

Gee, guys, it worked so well for you, I guess you’re trying to export your success to the majority party! Heavens above, what bitter irony, that the Republicans are doing their best now to force us to share in their failure as their longshot approach to success.

Stephen

If you lower the payroll tax, you help most people who make less than $106,000 a year, which is MOST wage earners and NONE of the rich.

The problem with the “stimulus” is that it only wants to pass around cash that pays back or creates political constituencies. We have a better idea. CUT THE PAYROLL TAX. There is absolutely no doubt that cutting the payroll tax would make it less expensive to hire new employees and put more money into the pockets of the middle class and the working poor. How is that bad?

Re the Romans – If you compare to the U.S., I always favor my own country, but the comparison is not really fair. America is the most successful country in the history of the world. We have a phenomenally stable political system. We are the only modern country never to have suffered a revolution (after the one that created us) and after our British cousins we have the oldest continuous government still in existence. But we Americans are a fairly warlike people too. There has not been a single American generation w/o some kind of war. Our longest period w/o a foreign war, 1865-1898, had those pesky Indian Wars.

The Romans had a significant problem with succession, which our Constitution addressed. We learned a lot from the Romans, from their success and also their failings. Madison and Hamilton explicitly learned from Roman models when they were working on our Constitution and every educated man in the founders’ generation was well versed in the classics. A brief walk around Washington DC will show you how much we are the heirs of Roman civilization. As much as I enjoy talking about history, this is not really the subject of this post.

Re the “you guys” – there is none so blind as he who will not see. Readers have the opportunity to see precisely what we write. It is not the Republican line. Christine is more radical than most Democrats in some respects, since she favors a Scandinavian style health care. We don’t have to toe the Republican line, since we are conservatives first who support Republicans because they come closer to what we want more often. There is no point in that “you guys” generalization and no justification for attributing the ideas of “those guys” to anybody on this blog since anybody can read the real arguments we are making.

I suggest that you take another look if you cannot discern the differences among the individuals who write here and don’t lump into groups different people. BTW – It is not useful to quote tired old homilies from professors. The only thing it tells us is that this guy is probably overpaid.

Here are the non-farm payroll employment numbers (in thousands). The current recession- the longest economic downturn since the Great Depression- started in December 2007.

Dec-2007 120
Jan-2008 -72
Feb-2008 -144
Mar-2008 -122
Apr-2008 -160
May-2008 -137
Jun-2008 -161
Jul-2008 -128
Aug-2008 -175
Sep-2008 -321
Oct-2008 -380
Nov-2008 -597
Dec-2008 -681
Jan-2009 -741 Obama takes office
Feb-2009 -681
Mar-2009 -652
Apr-2009 -519
May-2009 -303
Jun-2009 -463
Jul-2009 -304
Aug-2009 -154
Sep-2009 -219
Oct-2009 -190

(www.data360.org) U.S. Department of Labor: Bureau of Labor Statistics

In a sense, the numbers are actually worse than they already appear. Just to keep pace with population growth, non-farm payroll employment numbers should increase 100,000 to 150,000 per month.

To provide some perspective, during his four-year administration, Jimmy Carter created 10.3 million jobs; Ronald Reagan created 16.1 million jobs in eight years; George H.W. Bush created 2.6 million jobs in four years; Clinton created 22.7 million in eight years; and the worse president in the history of the United States, Bush #43 created under 2 million jobs in eight years.

The job creation trend for Obama is running in the right direction (a trend confirmed and apparently approved by the stock markets), but we still have a long way to go and a very difficult situation on our hands- and I do mean all of us. The deficit and the debts are scary. However, we’ve passed the first hurdle, and saved the economy from a meltdown rivaling the Great Depression. Now, it is time to create jobs, a task which may be every bit as difficult as the first one of stabilizing the economy, since creating jobs will involve transitioning to a green economy and stopping outsourcing.

If we can succeed- and that is a big ‘if’- then job creation will expand the tax base, and that in turn will increase tax revenues, thus drawing down deficits and the debt. Keep your fingers crossed.

Christine said: “And if you look at deficits, they were declining until 2007, the year the Democratic majorities took back both houses of Congress.”

Democrats took 51 seats in the Senate, which produced the Do Nothing Congress through 2009 thanks to Republicans obstructionist filibusters and threats of same. Democrats did not gain an effective majority to pass what they wanted in the Senate until this year, and even that is debatable given Independent Joe Lieberman siding often with Republicans.

In some important ways, Democrats still don’t have an effective majority in the Senate as the Health Care Reform bill amply demonstrates. They are having to rely upon two Independents for filibuster proof legislation of their own design, and Joe Lieberman is milking that position for all its worth to garner support from the Right for his 2012 Presidential bid.

And wow, have you got your history corkscrewed. One does not rack up a 5 trillion dollar addition to the national debt in 8 years as president by reducing deficits. Fact: Bush hid enormous amounts of his deficit spending in off-budget emergency appropriations in between budgets, which weren’t reported as deficits on the budget, only additions to the national debt. Talk about circumventing public oversight. Bush was at the very top of that effort.

Bush’s 2007 deficit may have been less than his 2006 deficit, but, that ain’t saying much considering he was adding an average of 625 billion dollars every year of his presidency to the national debt. Tell me, please, that you are not defending Bush’s budget record.

Bush dealt with two recessions during his presidency, the first was mild compared to this one, and not of his making. The second was the worst since the Great Depression and was, in part, of his making.

Obama’s job #1 coming into office was to get the economy back on its feet, and every president since Herbert Hoover who faced a recession signed into law stimulus spending or tax cuts or both, adding to the national debt, as Obama has done. Even Reagan’s stimulus approved legislation was aimed at saving job losses, and stimulating new job creation, and it took a considerable time to take effect, as will this stimulus bill. That is the nature of government stimulus spending, first increasing GDP and business profitability and then comes the lagging jobs creation by the private sector a considerable time later.

The private sector is NOT in a hiring mood or position right now, which is why Obama’s infrastructure investments is so appropriate and and the allocation of that stimulus over 2 years is what a majority of economists agree is a wise move given the lagging jobs creation after economic GDP moves back into the black.

In this current recession, it NOT a lack of capital sustaining the recession. It is a lack of consumption demand. Which means it is not a tax cut for business which is called for, but, more dollars put into consumers pockets.

The answer to this recession is to stimulate consumption. Given the current unemployment rate caused by the lack of oversight and regulation by Congress and the Bush White House over Wall St., and given Bush’s ownership society supported by Greenspan’s otherwise uncalled for low sustained interest rates, a housing bubble was created and burst, leaving contemptuous financial institutions practices laid to waste and bared for public viewing.

Obama has signed into law stimulus spending spanning two years aimed at job saving and creation, and protracted unemployment benefits which maintains consumption demand by even the unemployed, beyond the extent to which they are paying off debt. This stimulus spending is targeted precisely at the right sector of the economy, the majority of economists agree, (Wall St. Journal, this week).

If deficits and debt are a concern of critics, then those same critics cannot logically call for tax cuts during this time of deficit stimulus spending. They can only do that for partisan political purposes and very hypocritically, at that.

phx8 said: “The job creation trend for Obama is running in the right direction (a trend confirmed and apparently approved by the stock markets), but we still have a long way to go and a very difficult situation on our hands- and I do mean all of us. The deficit and the debts are scary. However, we’ve passed the first hurdle, and saved the economy from a meltdown rivaling the Great Depression.”

Very succinctly and accurately put, phx8. I would only add that of equal priority to job creation is resolving the tight credit amongst financial institutions. The economy is picking up again, and the free flow of credit is absolutely necessary to that pick up and its sustainability.

The Treasury Secretary, the Federal Reserve, and Congress have Sysiphus’ burden resolving this one, as the financial institutions are once again focused on preserving profits and enormous compensation rather than providing the nation what their institutions are uniquely designed to provide, credit. Never mind the fact that Democrats seem to have no interest in breaking up these Too Big To Fail institutions, which is another recession in the making even before this one is resolved.

David

When last did Republicans have a filibuster proof majority? We don’t need to make excuses for the Democrats or Republicans.

I find it very interesting how Democrats continue to plead ignorance and incompetence. If they held 100% of the seats, they would still complain.

The real situation is this. The Democrats find it much easier to promise and complain than to accomplish and govern. They are shirking their duty by pretending that they are hamstrung by their opponents who are in the minority.

They blame the Republicans when the Republicans are in the majority. They blame the Republicans when Republicans are in the minority. Democrats want the pleasures of being in charge w/o the responsibility.

Propitiation, you asked for an explanation of why jobs are lost well after the Gross Domestic Product (GDP) drops into the red, and jobs creation does NOT occur until well after the GDP moves back into the black.

At the beginning of a recession, first comes the loss of business and revenues in the private sector, then comes the loss of profitability, then comes the revisions to business’ budgets going forward, and then come layoffs and loss of jobs in increasing numbers.

This is the worst recession since the Great Depression because, though dropping in size, net jobs being lost is large, very large, since the recession began. Business is laying off workers in response to lower consumer demand, in order to cut operating costs while increasing productivity of remaining workers if possible, and preserving, or producing, profitability again. These job losses are occurring faster than new jobs are being created to rehire layed off workers, as well as to provide jobs for the new workers graduating from high school and college and entering the work labor pool.

Job losses being slowly and increase in pace with the onset and growth of of a recession. A recession being a contraction in the overall economic activity taking place. It usually is not known for many months afterward, when a recession began. Business sees consumption demand dropping off, but, without knowing whether that drop will be sustained, or how far it will drop. Businesses are reluctant to lay off workers, especially small businesses, until they have some answers as to what is coming.

Once, business is aware consumption will continue lower, they lay off workers, and try to increase the productivity of those labor hours they still employ.

Businesses will be reluctant to hire workers back if their productivity gains keep pace with lowered demand, and will only hire back workers when consumption demand grows sufficiently, requiring and justifying increases in their number of workers, in order to maintain or recreate their profitability. Other businesses will fail in a recession due to loss of consumer demand, and their workers laid off.

When the economy is back in the black and the recession ends, it ends with an overall consumer demand dramatically lower than when the recession began. And therefore, a dramatically lower number of workers are required by businesses when the recession ends.

Only after the economy has picked up sufficiently and grown over time, and the productivity gains of still employed workers can no longer keep pace with increasing consumer demand, will businesses begin to hire more workers again.

This is why employment is called a lagging indicator. Employment losses lag behind a recession’s onset by months or, a year or more. Likewise, employment gains lag behind the end of a recession by months or a year, or more, depending on the severity of the recession (loss of consumption demand and jobs), productivity gains per labor hour growth, and how protracted the recession is.

David,
There is supposedly legislation being crafted to address re-regulating the financial institutions. I’m still waiting. Like you said, if that problem is not addressed, we’re simply setting the stage for another downturn.

The same holds true for job creation. Another jobless recovery is unacceptable, because the results will be exactly what we expect, namely, another downturn that cuts to the bone.

Tight credit remains a problem. It may be that way for a long time. It is an issue for which Obama can be criticized. He has demonstrated a proclivity for being very cautious, very careful. I suppose that’s a good thing in a president. However, it means he elects to do things like recreate the financial sector as it existed before being bailed out by the government.

Personally, I don’t see why the socialists should bail out the capitalists- er, I mean, the government of “we the people” should bail out the capitalists of Wall Street, only to see them immediately resume paying enormous sums in bonuses. These are people who really, really don’t get it. We’d be far better sweeping them into the dust bin of history once and for all, instead allowing the S & L’s and credit unions to assume most of the functions once carried out by commercial banks.

I suppose Obama intends to resurrect the separations once in place through Glass-Steagall, and so bring commercial banks off life support, and back to full financial health, able once again to lend. We’ll see.

Christine asked: “When last did Republicans have a filibuster proof majority?”

Not in my life time, Christine. Which is telling in and of itself given that I am about to turn 60. But, then, Republicans have had the DixieCrats for decades to help their effective majority or size as a minority, as the case may be.

The counter is ABSOLUTELY not the case today as Republicans threaten the careers of their own if they cross the picket line on Democratic legislative measures. I can’t remember when I last saw a consistently lock step Party voting record in opposition to the other Party, as I have witnessed these last couple years by Republicans.

The Democratic Party has its left wing, centrist wing, and conservative wing, and the conservative wing would vote with Republicans on certain issues. Not a Single Republican in the Senate is willing to break ranks with their party now that Democrats are in the majority. This is a relatively new phenomenon in American politics, at least of the last many decades, and a number of senior Republicans have lamented this condition, from John Warner to Lindsay Graham.

Even Joe Scarborough laments the lack cooperation and and good faith negotiation between Republicans and Democrats. Democrats in Committee and Obama bent over backwards to hear Republicans suggestions and include a host of Republican amendments to legislation including the House’s initial health care reform in Committee. But, there is no reciprocity by Republicans when it comes to a vote on legislation coming from the Democratic majority, UNLESS, it has overriding vote buying power with Republican constituents back home, like extending unemployment benefits in hard hit Republican districts, primarily in the South.

Christine said: “The real situation is this. The Democrats find it much easier to promise and complain than to accomplish and govern.”

Wow, what big blinders this comment has on.

The health care reform has been an heroic undertaking by Democrats which Republicans wouldn’t touch when they had the majority to do something about its looming dire consequences for Americans and our economic future. Promise and complain? Are you kidding? The amount of work, effort, political capital, and compromise Democrats have put into this one bill outweighs nearly all the work done by both parties during the 2007 and 2008 Congress’.

They have accomplished what no other Party or Congress has since Teddy Roosevelt called for health care reform near the turn of the last century. They got it passed in the House, and pending in the Senate, with a president willing to sign reform into law. That is accomplishment, whether obstructionists prevent the bill becoming law, or not.

Failure to pass health care reform with this majority in Congress, dooms the nation’s economy, its politics, and 10’s of millions of her people to horrific consequences over the ensuing years before another super-majority party is created in the Congress again, to address reform again.

Of this I am inordinately confident. If this health care reform fails to pass, Republicans, not Democrats, will bear the weight of the consequences for the consequential decades to come. The young generation in their late teens and 20’s are watching and aware of what is taking place, and they will replace in the voting booths of tomorrow, the seniors today who are fearful of change and made anxious by the hyperbole, misinformation, and outright lies levied toward them in false advertising campaigns and right wing infotainment shows.

If I were Republican, I would be hard pressed to hope this health care reform didn’t pass for the sake of my own party. With its passage, the GOP will be able to hang every one of its faults upon the Democrats. Without its passage, the GOP carries the consequences of this nation going forward without health care reform.

David,
You write: “The Democratic Party has its left wing, centrist wing, and conservative wing, and the conservative wing would vote with Republicans on certain issues. Not a Single Republican in the Senate is willing to break ranks with their party now that Democrats are in the majority.”

It’s a good observation. Obama has made a point of encouraging bipartisanship. It’s the right thing to do. Unfortunately, he has paid a price for being willing to negotiate. The GOP has responded by using this willingness as a tool to delay, in hopes of outlasting the current Democratic majority, and winning more seats in the 2010 midterms. It is a viable strategy for the GOP. It’s a terrible strategy for the country. Most Americans realize this. Even as the polls fall for the Democrats and Obama- not by huge amounts, but enough- almost no one is willling to turn to the GOP for answers. That is the downside of their strategy of being unwilling to work with Obama. Obama has his virtues, and he has his faults. But if one thing is certain, it is that the conservatives in the GOP bring NOTHING useful to the table.

We’re still a full year away from the midterms, but I would be curious to see what Watchblog participants predict for the upcoming elections…

phx8, I generally agree with your reply.

I too will be waiting to see whether or not Obama will exert the power of his office over his Congressional Party members and Congress as a whole to find a dual solution to both the credit crunch and too big to fail dilemma. His advisers have to be telling him what the industry lobbyists are telling Congress persons, that breaking up these institutions will break down the entire financial sector, and cause a double dip recession or worse.

I wouldn’t want to be in Obama’s shoes for anything in the world, because I can’t conceive of an answer to this dual dilemma that would be politically feasible. Hopefully, Obama and his advisers are more capable than I. Voelker is the only adviser from what I am reading, that is advising Obama to reinstate the separations of financial institutions once part of the Glass Steagal Act. Summars and Geithner are opposed, apparently. It’s a helluva dilemma.

America is facing many more dilemmas with no solutions in the near and distant future if these kind of prophylactic measures and reforms are not undertaken today or very soon. Points of no return are about to be passed by in fairly rapid succession. Health care reform, education reform, infrastructure rebuilding and creation for the future, energy independence, Afghanistan, all sit on one side of the ledger, and debt and deficits sit on the other, outweighing the costs of reform and investment considerably in perception, and very possibly in reality. It is incredible how dependent we are now on our lenders and producers like China, India, and Middle Eastern nations, despite forecasts of this dilemma raised decades ago.

phx8, the only prediction I can reasonably make about the 2010 elections is that Democrats will lose a fair number of seats in the House, and a few in the Senate. I make that prediction on nothing more than the Democrats are now in the majority in both houses, and therefore, have more to lose from an anti-incumbent direction amongst independent voters. Pure odds making.

Way too early for any other kind of predictions, since a year in politics is in an eternity in which anything becomes possible.

Christine said: “There is absolutely no doubt that cutting the payroll tax would make it less expensive to hire new employees and put more money into the pockets of the middle class and the working poor. How is that bad?”

Classic Republican response. Lower taxes and raise deficits and debt. We had enough of that under GW Bush, thank you. Over 5 trillion dollars of new national debt. Let’s get this economy back on its feet at whatever price is politically possible, and then consider tax cuts for the non-wealthy commensurate with spending cuts, and tax increases on the super wealthy back to pre-Bush II levels, when capital was so readily available that it helped create a tech investment bubble of substantial proportions. And then cut even more spending.

Christine, why would an employer hire any employees at any cost if the consumer demand isn’t there to justify a single additional employee? You seem to be suggesting that in this environment, businesses would hire workers to stand around with their finger up their nose all day just because the payroll tax overhead for hiring them would be a few dollars cheaper per week. Yet another conservative ideology at work in defiance of reality.

I have to laugh. I just remembered some Republicans saying debt doesn’t matter just a few years ago. And Iraq had mushroom cloud makers in conservative TV ads. Gotta keep that sense of humor.

David

My point in asking when last the Republicans had a filibuster proof majority was to show that the current Democrat complaints that they don’t have enough power is dishonest. You cannot both blame Republicans for what happened when they had majorities and simultaneously let Democrats off the hook when they enjoy even greater majorities.

Re Democratic talk – yes they are working on health care, not successfully so far. They were supposed to create jobs and we are still waiting. They are now calling a big meeting, a job summit, to talk some more.
There is a fundamental problem with politics. Passing laws doesn’t necessary translate into action and when it does it often produces unintended negative consequence.
You also say that Obama faces such great problems. This is the general case for leaders. Maybe if Obama was a better leader these problems would not be as challenging. His REAL problem is that he is trying to find a way to make big government work. This is probably a bridge too far.

Re Payroll taxes – An employer hires someone if he figures that the production of that employee will be more than the cost. If you have to pay higher costs you can hire fewer people. Payroll taxes directly raise the cost of employment. Christine was self employed and realized how big a bite payroll taxes took out of her bottom line.
Democrats claim they want tax cuts for the middle class, not the rich. Payroll tax is one of the few taxes that is paid primarily by the poor and middle class. It is probably the only tax that you can cut w/o disproportionally benefiting “the rich”.

How about this as a radical proposal. Make it revenue neutral. Raise the income limit on payroll tax and simultaneously lower the rates. Democrats can still have the pleasure of taxing the American people while also making it more attractive to hire people at reasonable wages.

Many state governments are broke or nearly so. Here, there have been numerous road resurfacing projects that were scheduled for long term that have already been done, another project that was abandoned for lack of funding was restarted, and a third project that had been continually pushed back was started. So those are all jobs that have been both saved and created.

People should look into who the actual beneficiaries are for the money going to the banks. Another bank here just became part of Chase. Who exactly benefits from that?

Christine and John are a cute couple, and I thank them for writing here, but I expected that link under your names to be a link to a blog indicating other writings, which has been a requirement for years, unless this has been waved as an instance of affirmative action for conservatives.

Ohrealy

You can look at John’s blog at www.johnsonmatel.com/blog1. (Chrissy doesn’t have one) But you will probably be bored by what you find there. John tends to write boring travelogue. Watchblog is where the politics are.

Actually, that blog is very interesting, if a little Virginia-centric on the top page, and you should include it as a hyperlink under your names. Lee Jamison’s blog was about his artworks.

http://www.johnsonmatel.com/blog1/

ohrealy, thank you for reminding me about Lee Jamison. I just realized he hasn’t contributed here in a while. Did I miss something? It was unfortunate to lose Jack because of conflicts with his employment, and I hope Lee Jamison hasn’t gone the way Jack did.