Groundhog Day

Good news on jobs, two years too late. Usually a job loss bottoms out and then climbs out.You see this almost happened for Obama. But then his policies stalled the recovery.

We should have climbed out of the joblessness in December 2009 and by now have enjoyed almost two years of robust recovery. That is what Obama thought when he talked about the summer of recovery in 2010.

The long-awaited and long-predicted good economic news is also good news for Obama but he doesn't deserve the credit. Yesterday was groundhog day. A good analogy for the Obama recovery might be the groundhog on a cold February day predicting an early spring AND claiming his actions cause the early spring. By May or June, he claims to have succeeded. But it is worse in Obama's case. A least the marmot doesn't create massive debt by searching for his shadow and denying he sees it or jeopardize the future. Nor does he blame previous groundhogs for persistent the cold weather.

So two years after the "Summer of Recovery" we may finally get a recovery. I guess if you predict rain long enough, eventually it comes.

Posted by Christine & John at February 3, 2012 5:35 PM
Comments
Comment #335566

But C&J his policies didn’t stall the recovery. Why do so many on the right have no memory of 2008 and before? This was no ordinary business cycle recession why would you measure it as if it was? Until you guys except responsibility for the actions of the guys you voted into office things won’t change. Yet you continue to deny this and insist that more of the same Romney is the answer.

A least the groundhog doesn’t create massive debt by searching for his shadow or jeopardize the future.
True enough C&J but when you say massive debt your speaking of GWB right?

http://www.washingtonpost.com/blogs/ezra-klein/post/obamas-and-bushs-effect-on-the-deficit-in-one-graph/2011/07/25/gIQAELOrYI_blog.html

Posted by: j2t2 at February 3, 2012 5:47 PM
Comment #335568

j2t2

Bush grew government and grew debt. Very bad. Obama saw Bush’s “achievement” and raised him in both debt and bloated government.

I accept that Bush made a serious error. That is why more of the same only much bigger under Obama is not a good thing.

Posted by: C&J at February 3, 2012 5:50 PM
Comment #335571

The growth in government under Bush occurred mainly in three areas: rising health care costs driven by the private sector, DoD, and TSA.

Obama passed health care reform, ended the War in Iraq, and will end the War in Afghanistan in 2013. Khaddafi is gone. International alliances have never been stronger. Osama bin Laden is dead, and the American auto industry has been saved.

Even better, Obama has made no major mistakes, which makes him very, very, very, very different from Bush.

Posted by: phx8 at February 3, 2012 6:06 PM
Comment #335572

phx8

Is Obama spending more or spending less than Bush?

Posted by: C&J at February 3, 2012 6:14 PM
Comment #335575
Bush grew government and grew debt. Very bad. Obama saw Bush’s “achievement” and raised him in both debt and bloated government.

Not true GWB grew the national debt much more than Obama. In fact considering the circumstances Obama was left with, because the slate isn’t wiped clean when a new administration enters the white house, he has been rather fiscally responsible considering the previous administration.

Is Obama spending more or spending less than Bush?

Obama has to spend more C&J, Bush left so much in debt that must be serviced. Unless the Congress raises taxes it will only get worse. Even Congress cannot seem to be able to find places to cut the budget that won’t stall the economy and head us back into the past like Mitt would have us do.


http://en.wikipedia.org/wiki/United_States_Congress_Joint_Select_Committee_on_Deficit_Reduction

Posted by: j2t2 at February 3, 2012 7:14 PM
Comment #335576

C&J If you want a quick trip down memory lane on the intentional financial damage done to the country by conservatives and neocons in the GWB administration here is a good link for you.


http://www.politicalcortex.com/story/2010/12/4/153539/377

Posted by: j2t2 at February 3, 2012 7:20 PM
Comment #335580


I don’t recall the economy producing 240,000 jobs during any month of the Bush Administration.

In 2003, the economic news was bad for Bush. In 2004 the economy improved enough to help reelect him. I think that was the year that homeowners began spending their equity in earnest.

I bet Rush smells a conspiracy, the Democrats deliberately put the summer of recovery off for two years so Obama would get reelected.

Posted by: jlw at February 4, 2012 12:10 AM
Comment #335584

Things would look a good deal better if the House had stayed Democratic. This is a tepid jobs report at best but probably not an inventory bounce. BO’s big mistake was under estimating the problem and not pushing for a much larger stimulus to start with. The program softened the blow but did not pump enough into the economy to get it going. Of course we do not know all the political limitations he encountered but he should have tried. Keynes predicted that even a liquidity trap economy will most likely recover sooner or later as equiptment wears out or becomes obsolete without government intervention but it is an all too slow a process. Considering the trillions wasted by unused capacity and the tragic effects of long term unemployment on a society the Republican blockade of any BO economic stimulus policy is as irresponsible as it is reprehensible.

Posted by: bills at February 4, 2012 3:49 AM
Comment #335588

We have a different outlook on the economy. Most of you seem to still believe that government runs the economy and you measure inputs as results.

Obama’s stimulus was the most massive in the history of the world. If you look at the graph, you see that job growth stopped just about the time the Keynesian models would have predicted growth, as the stimulus was hitting its high points.

We also have to ask how much more we COULD have pumped in. Obama was unable to usefully deploy all the stimulus as it was. You just cannot simply turn on a switch and start infrastructure projects, as Obama himself learned when his experience grew.

I am growing tomato plants. I fertilized them when I planted and I fertilize them regularly. After a certain amount, more fertilizer will not make the tomatoes grow faster and if I keep on applying, I may slow their growth or even kill them.

I cannot believe that none of you are gardeners or farmers. Those of you who understand this ask yourself. Does doubling the fertilizer double output? And does doubling it again, does that double output again?

If the model Obama was using worked, we would have had robust growth in starting in December 2009 and summer of 2010 would have indeed been the summer of recovery as Biden and Obama promised. It didn’t work.

Posted by: C&J at February 4, 2012 8:48 AM
Comment #335589

jlw

Re job growth - Reagan managed more than a million in Sept 1983. In terms of presidencies, Obama is late and short. There were months during the Bush time with more than 350,000 jobs produced.

Of course, we both know that presidents don’t really create jobs. Democrats have been accepting that when jobs were bad, now they will change their minds again, unless jobs again decline.

Posted by: C&J at February 4, 2012 8:56 AM
Comment #335590

One thing I can say about the jobs graph you post is it looks different without the Census hires. The Census makes it look like jobs went from big losses to big gains then slowed down for Obama’s policies, which is your argument. It’s an easy argument to make without seeing the data without the Census hires.

What you see instead is that job losses bottomed out after the stimulus was law, and the recovery was fairly steady until 2011 with Japan, gas prices, and the debt ceiling debacle. Here is this same chart with different documentation.

Posted by: Adam Ducker at February 4, 2012 9:18 AM
Comment #335591

Adam

Excuses. If we want to put “shocks” into the system, we should take into account the really big ones like 9/11, Katrina, big oil price rises etc. We expect that in any reasonable period of time there will be upside and downside shocks.

The biggest upside, BTW, is the fantastic growth in oil and gas production made possible by new technologies. Obama has supported this is some rhetoric, but his actual behavior with things like granting leases and the Keystone pipeline has told a different story.

The thing that will pull America out of the doldrums is the massive and REAL stimulus of this American energy.

Anyway - recessions end. This one took much longer to show positive results. Obama took possession of the economy. He claimed his stimulus would fix things. It didn’t. I never thought - and have said on many occasions - that presidents have such power. But Obama claimed it so he owns it and I feel it fair to hold him to his predictions and plans.

We should have had the summer of recovery in 2010. Two years late AFTER his stimulus supposedly was stopped by evil Republicans is not to his credit.

Posted by: C&J at February 4, 2012 9:40 AM
Comment #335592

C&J: “If the model Obama was using worked, we would have had robust growth in starting in December 2009 and summer of 2010 would have indeed been the summer of recovery as Biden and Obama promised. It didn’t work.”

Who predicted robust growth by December 2009? How do you even define robust? What we see is a recovery that started in 2009, was slowed by different economic conditions, and which has picked up considerably in the last few months.

Posted by: Adam Ducker at February 4, 2012 9:42 AM
Comment #335593

C&J: “Excuses. If we want to put ‘shocks’ into the system, we should take into account the really big ones like 9/11, Katrina, big oil price rises etc.”

Excuses? You mean documented events that had impact on this recovery? Had 9/11 or Katrina happened during this recovery that would be relevant. I don’t see your point.

“We should have had the summer of recovery in 2010.”

Based on what, again?

Posted by: Adam Ducker at February 4, 2012 9:46 AM
Comment #335594

C&J: “Reagan managed more than a million in Sept 1983.”

Again with that one month that makes it seem as if Reagan had some mega recovery? You know the million jobs was because of factors in the month before and that the average jobs per month that year was 293,000 per month. That was better than our average of 152,000 in 2011 but of course this was a deeper and longer recession with no housing market to boost it. You continue to be dishonest in comparison of this recovery to Reagan’s with your selective usage of data.

Posted by: Adam Ducker at February 4, 2012 9:53 AM
Comment #335598

C&J you and many others on the right continue to point at what you consider to be a slow recovery, that under a repub president would have been faster, yet you seem to forget that under republican/conservative control we lost those millions of jobs as our economy along with most of the industrialized nations teetered on the edge of ruin. You seem to now concede GWB was part of the problem but forget it was also the republican/conservative congress applying conservative principles that was also responsible for this problem. problem.

You are now asking the American voter to forget all of this Pre-Obama history and vote for the same people and principles that put us into this mess. Why?

Posted by: j2t2 at February 4, 2012 12:13 PM
Comment #335599

Adam

You all blame Bush for recessions in 2001-2, when in fact we faced one of the worst shocks in our lifetimes. I am just saying that shocks happen. In fact, I bet if we have a string of really good luck, as we did in the 1990s, things get pretty good.

Re summer of recovery - I am just quoting Obama and Biden, et al. Why did they say these thing if they didn’t believe them? Obviously, their experts thought things would pick up a lot quicker.

Re robust growth - Something like we had in the middle of the 1980s or 1990s is robust growth.

Re Reagan v Obama - Job growth comes faster after a big drop, as people come back to work. I am not saying that we catch up, but obviously new jobs must be created at a rate greater than the growth of the labor force in order to catch up. Obama should have done better given those circumstances. Something happened to retard the growth.

Perhaps it happens not in spite of Obama’s best efforts but because of them.

All

If you want to see the shape of recession and recovery, look at this chart. Go back to the farthest year (1939)

You see that recessions end and that when jobs are pushed down fast, they tend to rise fast. Obama’s recovery is in this pattern, a little weaker, but he “did it” at a very high cost. Wasted money.

http://data.bls.gov/pdq/SurveyOutputServlet

j2t2

I think GW Bush was part of the problem to the extent that he bloated government. This seems the problem in Europe too. Obama saw this and raised government spending. If you are getting too fat from eating too many donuts, the answer probably is NOT more donuts.

I am asking the American people to remember the government bloat and slow it back down. We also understand that if you can blame Republican control of one part of Congress for events in 2010-12, you certainly can blame Democrats in control of both parts of Congress 2006-10

Posted by: C&J at February 4, 2012 12:51 PM
Comment #335602

C&J: I don’t blame Bush for the dot-com bubble bursting though I will point out the recession started under Bush and not before as many Bush supporters try to say. Some even tried to get the business cycle re-dated to make Bush look better and Clinton worse.

As far as summer of recovery goes I don’t know how many times I have to point out that it was actually “Recovery Summer”, a summer long promotion of recovery projects that were set to go into gear that summer. It was not “summer of recovery” so I don’t see why you keep using that as a talking point.

You’re looking at the Reagan recovery as if it’s a fact that Obama’s recovery should have worked the same despite the differences in depth and cause of this recession. I don’t understand that. Reagan had no financial crisis and he had no housing bubble.

Posted by: Adam Ducker at February 4, 2012 1:20 PM
Comment #335604

I can’t get the DB link to work. Where did you start from?

Posted by: Adam Ducker at February 4, 2012 1:23 PM
Comment #335605

C&J GWB’s administration and the conservatives in Congress borrowed money and cut taxes at the same time we went to war and nation building. The repub controlled congress “reformed” medicare without paying for it. Conservatives for the most part were silent. This had to be in line with conservative principles or they wouldn’t have done it. Deafening silence from the conservative voters until Obama was elected and the deficit became a problem. Just as the economy melted down. The reason this wasn’t a depression was due to the safety net already in place and the additional stimulus funding.

The dem controlled congress passed the laws necessary to restore confidence in our economic system. What precisely is it that you think they did that we should blame them for? The reason I ask is the leap in logic that would lead one to believe that because we blame one session of Congress for a problem they caused should lead us to automatically blame another session of Congress doesn’t always hold up under scrutiny.


Posted by: j2t2 at February 4, 2012 1:28 PM
Comment #335610

Adam

The economy does not turn on a dime. If you look at the graphs I had in the link, (try this one http://data.bls.gov/timeseries/CES0000000001?output_view=net_1mth) you see how the economy started to decline in early 2000, a year before Bush came in.

Obama was lucky to have the recession already started, so he could blame Bush. Clinton was the luckiest of all. If you look at the charts, the economy started to rise just before he came in, but before people noticed, and left when it started to decline, but before people noticed.

I use the “summer of recovery” because that is the way Obama and Biden used it. They clearly didn’t expect it to take another couple of years. It was/is dishonest. As I said in the above, it is like the groundhog claiming to have created the summer that will happen in any case.

J2t2

Dems were in charge when the fecal matter approached the cooling device. They were in no hurry to cut spending and did not. They just wanted to spend differently. When they took control of all three parts of the government they spent MORE and extended the tax cuts. When Obama’s folks “reformed” the financial system, they left in place the same guys who made the big bucks AND they gave them bonuses.

Posted by: C&J at February 4, 2012 3:59 PM
Comment #335611


Reducing the size of government isn’t the issue, most Americans realize that the government budget must be gotten under control and that reductions should be made.

The issue is who will make the decisions and what will be the priorities.

The Republicans have made it clear that they wish to accomplish the job by starving the government of revenue while protecting military spending, forcing the social programs to bear the brunt of the cuts. That is unacceptable to a majority of the people.

That has been the priority of the Republican party since Bush left behind the huge debt, suggesting that the accumulation of that debt was a deliberate political ploy that has not met the expectations that Republicans anticipated.

“Something happened to retard the growth.”

Well, that must mean that this recession is different than previous ones in some fundamental ways.

IMO, something fundamental is happening that is a threat to future job growth as we know it. A new era that could produce change as profound or greater than the industrial revolution. I believe we are on the brink of an era when job growth may no longer be a natural response to population growth.

Posted by: jlw at February 4, 2012 4:16 PM
Comment #335613

I looked into things, getting the jobs numbers off the BLS.gov site, and downloading them into excel so I could analyze and average the relative performance. I also analyzed the three presidents who preceded them to get a better picture of the economic period before.

So, let’s start with some basics.

The first result is not flattering to Obama. His average job creation numbers per month is… Well, not creation actually. Destruction. 32,000 jobs a month destroyed.

“Ha!” The Republicans say.

You might say ha, but Bush’s monthly job creation average, over the course of his administration, is 11.4K jobs a month. Want contrast? 236.9K for Clinton, 167.7K for Reagan, and 54K for Bush Senior.

But those averages… Well, averages can be weighed down. If you want to know why Reagan’s average is weight down, it’s got something to do with the seventeen or so months worth of negative job growth that occurred during the recession that began his administration. If you were to compare monthly averages of the first term against the second, you’d find that Reagan averaged 110.9K jobs created a month in his first term, and 225.6K jobs created in his second term. In other words, not having a recession in his second term almost doubled his average pace of job creation.

Indeed, if we average just the months when he did create jobs(leave out all the months that have negative numbers), then we we find that those months averaged to 255.6K.

Do the same by term, and we get 294.7K for his first term, and 231.3K. In months where Reagan created jobs (the only ones we’re counting for these averages) He created them intensely.

What about Clinton? Well, Clinton’s got Reagan beat on all fronts. His average for all months of his administration was 236.9K, his strongest year, 1994, totaling 320.9K. Reagan only beat that in 1984.

So, what does that have to do with our two latest presidents?

Well, let’s start out with Bush’s rate of job creation, both real, and his averaged positives. Bush’s overall average, as I said, was a mere 11.4K a month. If we split that between terms, his first term average 271 jobs lost a month, and his second term averaged 23.1K jobs added a month.

And yes, Obama averages out to losing 32K a month. I know.
What happens to the average if we relieve him of the burden of the first six months? Well, he goes from losing 32K a month to gaining 61.5K a month. Ah, but don’t we want to do the same for Bush? I mean, it’s only fair we measure his averages without the recession, too.

Bush comes out to 62.2K a month.

Wait, how does that work? Bush gains about 50K on his average, and Obama gains about 90K! The first six months of the Obama administration weighed far more on Obama’s monthly job creation average than the last year or so of the Bush Administration did on it.

Here’s the thing, though, and it’s helpful to understand this: Bush’s numbers are weighed down by two other periods, first being the comparatively shallow recession of 2001 (.3%, as compared to the 5.1% of the most recent), and the second being the period of about a year and a half after that recession.

When Republicans talk about Obama having a jobless recovery, they are intentionally evoking a term Democrats used to describe the recovery after that recession. As usual, they’re trying to say Obama’s as bad as Bush (funnily, while trying to sell a continuation of Bush’s policies)

Both recessions at the start of both administrations were followed by a period of job losses.

In the six months after the 2001 recession, the Bush economy would lose another 570K jobs. Consistent job growth would only return 21 months, or almost two years after the recession ended. During that time of inconsistent job growth, following the six month period of jobless growth, we would see an additional 296K jobs created, and an additional loss of 804K jobs. In simple terms, before we returned to consistent job growth, We lost an additional 1.078 million jobs.

Let’s take the Obama administration’s period of so-called Jobless growth for a spin. An additional 1.259 Million jobs would be lost before job growth reappeared. When it did, though, we saw the economy add 944K jobs in a three month period. We would then lose an additional 303K jobs, which means on the balance, the post recession job losses for Obama were about 618K.

It’s worth considering these numbers in context: Bush’s recession was shallow, at .3%, and during it’s course, We lost 1.631 million jobs. The second Bush recession, a deep one at 5.1%, would cost 7.520 million people their jobs before its end.

Yet Obama, with a harder recession to recover from, and a much more terrible job loss after the fact, would take shorter time to get back to consistent job growth, and leave fewer people out of work at the end! Heck, if you mark things from the restart of job growth, Obama’s numbers are positive to the tune of 641K jobs gained, while Bush’s numbers are negative to the tune of 508K lost.

That’s not all. If we were to be really fair to both on job creation, and only average the months where both increased jobs, Bush’s average job creation numbers would be 153.3K, while Obama’s would be 182.5K.

In other words, despite all the handicaps, When Obama creates jobs, he creates them. He doesn’t muddle around, hoping that a recovery takes hold. He moves quicker, gets results quicker, and more profoundly with much greater success.

If you think that’s a fluke, his average job creation number over the last year was 158.7K per month.

In other words, the Obama administration’s real world average for monthly jobs growth last year beat Bush’s most ideal average, that is an average of just the months where jobs grew.

In fact, it did better than the yearly averages for all but three of Bush’s years in office.

And last month? Well according to prelinary figures, Obama beat that last years average by 60.5K.

So, in short, let me say this: Obama create jobs better than Bush does, and the only reason why his performance doesn’t seem better is that he was handed a raw deal by circumstances beyond his control. Even so, he has done better with that raw deal than Bush did under much less troubled circumstances. Bush’s only saving grace for job creation, I would imagine, was the growth created by the inflation of the real-estate bubble, whose overleveraging would in turn effectively turn both his terms into washes in terms of job creation.

Posted by: Stephen Daugherty at February 4, 2012 4:36 PM
Comment #335615

Oh, one other thing: the way I figure it, Obama breaks even on job creation if he keeps last years pace in just under eight months time. Then, if he keeps that pace through to march of next year, he will have created more jobs in his one term and change than Bush EVER created.

Posted by: Stephen Daugherty at February 4, 2012 4:58 PM
Comment #335617
Obama was lucky to have the recession already started, so he could blame Bush.

Lucky! Were the American people lucky as well? It really isn’t a matter of blaming GWB C&J it is more a matter of fact. The fact is the financial meltdown happened on GWB’s watch. It happened due in large part to conservative policies as well.

Dems were in charge when the fecal matter approached the cooling device. They were in no hurry to cut spending and did not. They just wanted to spend differently.

The bus was already speeding downhill with the brakes gone when the dems took over in ‘06 C&J. Spending cuts must be judiciously applied when the economy is in the toilet so as to not continue the downward spiral into the sewer. Which brings up another problem with repubs/conservatives. They seem to think the deficit should be cut at all costs while the economy staring to recover. Kinda of like the conservatives of the depression era who took us back into recession in ‘37. We must reduce spending. But we must do it at the right time. During the time frame when the economy was doing so well the repubs did the opposite they over leveraged us.


When they took control of all three parts of the government they spent MORE and extended the tax cuts. When Obama’s folks “reformed” the financial system, they left in place the same guys who made the big bucks AND they gave them bonuses.

C&J the repubs and conservatives fought tooth and nail to keep any reform from happening. Why blame it on Obama? Once again spending cuts need to be made when the economy is doing well nit when it is in the toilet.

Posted by: j2t2 at February 4, 2012 6:24 PM
Comment #335618

“You all blame Bush for recessions in 2001-2,.”

C&J,

That is simply not true. We are all aware of the bursting of the Dot.com bubble and the shocks to the economy from 9/11. Nobody blames Bush for those factors. We are, however, also aware of the tepid and extended jobless recovery despite the stimulus of the massive tax cuts.

We are also aware of the fueling of an eventual economic expansion in the mid 2000s through a massive private sector debt explosion supported by a housing bubble which crashed spectacularly in 2008. In my opinion, the Bush administration and the Fed share primary responsibility for the housing bubble and the pseudo economy of the mid 2000s. Democrats certainly share some responsibility but they weren’t in the driver’s seat. They went along for the ride.


Posted by: Rich at February 4, 2012 6:42 PM
Comment #335620

jlw

“Well, that must mean that this recession is different than previous ones in some fundamental ways.”

Yes - the response. Massive spending. That was different than anything we did since the 1930s.

Re government - we need a government that is smaller and more efficient. One the properly plays the role that government should but doesn’t interfere in other parts of society. Republicans as a party don’t go for this, but Democrats are generally actively hostile to the idea. This was not always the case. When Bill Clinton said the era of big government was over, he had the right idea.


Stephen

You over analyzed the numbers. I learned that some things can seem to make sense in numbers of statistics, but have no practical meaning.

You also failed to factor in changes in the labor force. Creating 1000 jobs in 1980 is worth more than creating 1000 jobs today, since there are more people.

Job creation can be looked at only in the general sense and it is connected to presidential policies only loosely.

Why do I attack Obama on this if I believe as I do. Because he asked for it. He made assertions and was wrong. We have to pound him on that.

You also make a big error in comparison. You and most Democrats keep on talking about how hard the drop was. This is true. But we are not tied to that. If we lose 1000 jobs in May and create 1000 jobs in June, we would see the improvement. In fact after the steep drop we would expect the steep rise.

In this post, I am not blaming Obama for losses in the first part. I am blaming him for the weak recovery after December 2009. In the recoveries of Reagan, which was also from a big drop, job growth recovered and continued to go up. In Obama it recovered and then fell back down.


J2t2

There are a lot of scholarly research being done on the financial collapse. The initial spin was political. As we find more about it, we see a complex of causes. “Conservative” policies played a role, but so did “liberal” ones as well as lots of circumstances not closely related to either.

One of the biggest problems was emphasis on home ownership growth. This was certainly bipartisan.

Re Democrat control - you guys blame Republicans who were in the minority and for much of the time faced a filibuster proof Democratic Senate. It doesn’t get any better than that for a party. Republicans have not had such a majority for nearly 100 years. You need to take ownership of some of this.


Posted by: C&J at February 4, 2012 6:54 PM
Comment #335621

Rich

“That is simply not true. We are all aware of the bursting of the Dot.com bubble and the shocks to the economy from 9/11. Nobody blames Bush for those factors. We are, however, also aware of the tepid and extended jobless recovery despite the stimulus of the massive tax cuts.”

This is almost exactly the same thing I am saying about Obama in this post. Just change the dates and the names and change massive tax cuts to massive stimulus and we got it.

Maybe Bush and Obama made essentially the same sorts of mistakes in growing government. Maybe we need a better approach.

Posted by: C&J at February 4, 2012 6:57 PM
Comment #335623

C&J: “In Obama it recovered and then fell back down.”

No, it really didn’t. And again you can’t compare the two recoveries and say one falls short because they are completely different economic situations.

Posted by: Adam Ducker at February 4, 2012 7:15 PM
Comment #335624

C&J wanting home ownership for most of the people in this country is a good thing, IMHO, and yes both sides should get credit for wanting to achieve this goal. But the want of home ownership didn’t sink the economy, it was speculation, over leveraging and lack of proper regulations. By and large a private sector deal. Because the securitization of loans was so profitable for the few they needed to continue to turn out loans, eventually the well ran dry.

I am not trying to sound like all the problems all the time were rooted in conservative agendas C&J. However those I continue to harp on are rooted in conservatism. The dems are not perfect by any stretch. In fact as time goes on it gets harder and harder to tell the two parties apart. Guess we need a list of corporate sponsors to tell them apart.

The difference between GWB and Obama is the damage by GWB was intentional for the most part and based upon conservative ideology. That is why it would dangerous to elect another rightist president to ruin the country. We really can’t afford another conservative businessman to be president.

Posted by: j2t2 at February 4, 2012 7:19 PM
Comment #335626

Adam

I suppose all good recoveries are alike but all poor ones are bad in their own way. This is a bad recovery in its own way.

j2t2

Pushing home ownership to those who could not reasonably afford the payments helped create the bubble and helped strengthen the myth that home prices could never go down.

I too think that it is a great and admirable goal. But it is a lot like wanting all children to be loved and all people to be healthy. We can wish for such things, but we cannot base policy on wishful thinking.

Re damage being intentional - you know that is silly. Do you really think Bush or anybody else in power wanted to harm the American economy? This is the same sort of pernicious idea - which I also reject - that Obama wants to destroy American power for ideological reasons.

People in power make choices. Some are appropriate; others not. I don’t believe that any high American leaders make choices for evil reasons.

Posted by: C&J at February 4, 2012 7:33 PM
Comment #335627

j2t2


BTW - A short time ago, we heard that Romney was too moderate to be nominated by the Republican Party. What is happening now?

Posted by: C&J at February 4, 2012 7:34 PM
Comment #335628
Do you really think Bush or anybody else in power wanted to harm the American economy?

I believe conservatives have proven that they are willing to destroy the economy in order to gain their ideological goals. “Starve the beast” is a concerted effort by conservatives to force the government to get rid of the safety net programs put ion place by FDR and LBJ. Look at them frothing at the mouth as soon as Obama was elected to cut the deficit, when just a few short years before they were cutting taxes and going to war. The were passing unfunded mandates in order to build the deficit up. Do you really think the spending spree of the conservatives during the GWB era was accidental?

“”Starving the beast” is a fiscal-political strategy of some American conservatives[1][2][3] to cut taxes in order to deprive the government of revenue in a deliberate effort to create a fiscal budget crisis that would then force the federal government to reduce spending. The short and medium term effect of the strategy has been increased United States public debt rather than reduced spending.”

http://en.wikipedia.org/wiki/Starve_the_beast

Posted by: j2t2 at February 4, 2012 7:58 PM
Comment #335629

jt2t

I don’t think “starving the beast” would destroy the economy. It is more like trying to put a fat man on a diet. You have to stop enabling the bad behavior. That is what it is meant to do. The fact that the fat man in question still manages to borrow food is regrettable. He has defeated the good discipline. But does that mean that we should forget all discipline because we cannot make it stick in some situations?

Re the “spending spree” I think that the nation reacting to the shock of terrorism in ways that today seem to make less sense. I believe the same thing happened after the financial crisis when we threw too much money at the problem.

So indeed, I don’t think spending sprees were accidental, neither by Republicans or Democrats. There are always reasons to spend more, just like there are always reasons for the fat guy to eat more donuts - one more time.

Posted by: C&J at February 4, 2012 8:08 PM
Comment #335632

C&J,

It wasn’t the federal spending of Bush that caused the deep recession of 2008. It was the collapse of private sector debt supported by an inflated housing market that had achieved an astounding 350% of GDP in 2008, only matched historically in the years preceding the Great Depression.

This meme that federal spending or “big government” is at the root of all problems just doesn’t square with the facts. It wasn’t public debt that collapsed in 2008. It was private sector debt.

The allegation that federal spending under Obama has somehow impeded the recovery is similar to the allegation that bloated Bush federal spending is somehow causally related to the collapse. No data is provided to support such allegation. It is nothing more than a naked assertion.

This constant conservative focus on government spending (excepting of course defense spending) is simply a diversionary tactic to avoid discussion of conservative policies more directly related to the collapse in 2008, i.e., financial deregulation, globalization, free trade, etc. It also avoids any discussion of fundamental problems in the main economy. According to conservatives, if government would simply get out of the hair of free enterprise, everything would be great. Of course, our recent experience with free financial markets and their ability to self-regulate might make some a bit hesitate to accept that premise.


Posted by: Rich at February 4, 2012 9:05 PM
Comment #335634
I don’t think “starving the beast” would destroy the economy.

Yet here we are $15 trillion in debt and according to conservatives if we don’t cut the deficit we will collapse. In fact the Tea Party representatives in Congress insists the deficit be cut even if it means the economy goes back into recession. It is ideological nonsense that has caused the problems we face today C&J.

The problem is this C&J. This drastic approach to “fat reduction” has put us into a position where solving our other problems is complicated because of the massive run up in debt. So by intentionally bloating the government in good times conservatives have taken away the ability to do so in the lean times. It is malfeasance and voting for the same people perpetrating this type of attack upon this country only worsens the problem.

Using your analogy, the fatman really wasn’t fat it was mostly muscle with a roll around the mid section, yet because those making the determination were anorexic the appearance of some fat was enough to send them into a tizzy so these conservatives arbitrarily decided to starve the fatman until most of the muscle was gone. Instead of becoming healthy the fatman grew tired and delirious and actually thought less food was the answer.

http://www.washingtonpost.com/blogs/ezra-klein/post/the-tea-party-occupies-the-supercommittee/2011/11/17/gIQAU2YZVN_blog.html

Posted by: j2t2 at February 4, 2012 9:35 PM
Comment #335637

C&J-

You over analyzed the numbers. I learned that some things can seem to make sense in numbers of statistics, but have no practical meaning

A large part of our discussion here is about the relative rate of job creation, or destruction Your chart itself shows just how much of a distorting effect the last recession had on those numbers. Recall that Obama’s tenure doesn’t begin until the lowest point has been reached on that graph. You can plot a curve of a rapid recovery that slows as it reaches the other side, but at least that’s better than the opposite, which was job growth slowing from its peak in July 2005, and then suddenly dropping to catastrophic lows that bottomed out in January 2009. You have to go back to 1949 or 1945 to find job reductions that steep, and those are more spikes from demobilization and deleveraging than they are the reflection of a permanent trend. The jobs came back quick enough in those cases.

So, we weren’t merely dealing with a jobs loss, coming off the Bush Administration, we were dealing with a catastrophic rate of job loss. And, as I’ve told you again and again, the current economic climate is considered to be a consequences of those job losses, not merely a cause of them.

So, the question of how fast a given policy can regain those jobs is not an idle one. Nor, if we’re trying to give credit or blame for the policies that restored that job growth, are we unwise to compare what your policies have done in the past, to what our policies have done.

Maybe it’s a little too much raw information for you, but that was what the averages were for.

So, starting out the Bush Administration, what we have here is a minor recession. In fact, the most minor of any that that has hit us since the great depression, at least as far as GDP loss is concerned. But if you look at it in terms of jobs lost, it’s anything but. We lost about 1.6 million jobs in that one. That’s more jobs lost there, all by itself, than either Bush Sr, Gerald Ford, Jimmy Carter, or Richard Nixon’s recessions ever lost individually.

The only recession of the last fifty years that it’s not worse than in this respect would be Ronald Reagan’s. And you know what Ronald Reagan’s solution was to his economic problem? Tax cuts, not unlike Bush’s. Supply side economics. Austerity measures out the keister. Deregulation. Reagan is fortunate that he had austerity that he could undo, by letting up on inflation fighting measures. Because of the profound effect of letting up on those, he enjoyed a second term.

But that’s not the worst part about it. In the period after that recession, Bush’s response didn’t help bring jobs back. From December of 2001 to August of 2003, the lingering instability of the job market cost an additional 1.078 million jobs. Even if you measure it from when job growth restarted, six months after the recession ended, you’re still down about half that amount.

If you count that together with the other numbers, you get a total job loss of about 2.709 million jobs.

Put another way, that is about 300K short of Obama’s total share of job losses from his side of the recession. To be fair, Obama would lose another million and a quarter jobs after the recession, but this would be handling a recession several times as deep in GDP terms, where 4.6 times as many jobs were lost in the recession itself. Over four million jobs had been lost in the recession before Obama took office, as it was. The Bush Recession’s job losses were all his. Ultimately, seven million jobs would be lost under an administration that only gained short of eight and a half. That’s about four fifths of what Carter gained in the late seventies during one term, Less than half of what Reagan created, a little more than a third of what Clinton created.

And that’s comparing the apple of Bush’s total jobs created to those president’s numbers with the lost jobs subtracted. Subtract the jobs lost, and even Ford created more in a little more than half a term than Bush did in two.

That’s terrible.

If Obama keeps up his current pace of job creation, even he, with one half of the biggest recessions in more than half a century weighing down on his jobs record, plus 1.2 million more in the aftermath.

I think the relative speed with which Obama is capable of adding jobs back is an issue, especially if you’re seeking to prove him wrong. If your policies are essentially Bush’s policies, if we’re being asked to back the status quo, then we’re being asked to back a policy that failed so catastrophically that it lost seven jobs for every eight it created.

Let’s also consider that Bush policy failed so miserably to mitigate a recession that our economy did not return to conditions of consistent job growth for thirty months after the beginning of the recession. Obama’s policies began with the worst of economic problems and put us back on the path to consistent job growth in 21 months.

But also, another fact needs to be considered: austerity measures. The states and local governments have cut about 640,000 jobs during the Obama administration.

If this had not happened, then just on a linear basis alone, Obama would be on track to break even in the next three months. But in the calculus of the stimulus, we might have already done better than break even by this point, given that those job losses hit right as the Stimulus was doing its work.

And now your policy, forced by the Tea Party, is set to cut even more jobs from the Federal government. Isn’t that just brilliant?

We’ve seen one jobs figure after another pulled down by the cuts motivated by austerity measures. That’s why the Obama administration talks about private sector jobs being created, because the public sector’s become a net loss for employment numbers on all too many occasions.

The only Groundhog Day here seems to be the one that the GOP is stuck in, where the same old policies are tried again and again, with the same results. Hopefully, the Country can get out of this faster than the GOP, and the GOP itself faster than Bill Murray got out of his cycle of repetitive mistakes.

Posted by: Stephen Daugherty at February 4, 2012 9:41 PM
Comment #335639

Oh, by the way, Growth has been back since October of 2010, a period of sixteen months. The main period of reduced speed in that growth was the summer of last year, when the yahoos in Congress were threatening a debt crisis. Since that’s ended, the numbers have stayed above a hundred thousands a month.

One wonders how much we could have grown if the GOP hadn’t threatened a financial panic to get it’s job killing austerity measures. Thankfully, we’ll have some time to undo those mistakes before they become a problem, or at least compensate for it with greater stimulus efforts.

Posted by: Stephen Daugherty at February 4, 2012 9:47 PM
Comment #335640

Rich

Big government means that government gets involved in too many things. When it does that - when any organization gets too bloated with too many priorities - it loses sight of what it should do and begins to interfere with what it should not.

There were plenty of regulations in finance that didn’t work. And there was a tacit alliance between big finance and big government. Crony capitalism is possible ONLY when government controls chock points of the economy. We got more of that.

Government has legitimate need to manage the currency and credit. It has a monopoly of money creation. It manages interest rates, so it manages credit and debt on the macro level. Private greed - greed in general - is always present. But it takes government to magnify this into a national problem.

Government debt in America cannot collapse. They print the money and the debt it denominated in dollars. What it can do is infect other parts of the economy, as it has.

Stephen

You can take more from a lesson than it has to teach.

Beyond that, it depends on how you take the starting and ending points and how you adjust for changes in the labor market.

Much of your underlying assumption is based on input produce outputs in a predictable way. This is not true. Some small inputs create great gains, as we saw recently with Facebook and some massive inputs produce not much or even negative gains. I will not say “as we see with Obama” although that might be true, but let me take the example of “New Coke”. One of the world’s best marketers spent billions trying to sell a bad product. If Coke had done nothing except business as usual, it would have been far better off. I think the same goes for Obama.

Re Reagan v Obama - Obama’s stimulus was much bigger. But I think we have an intangible question of leadership. Reagan believed in America. He was optimistic and his people did the necessary work. Obama is a poor leader and tends toward pessimism and blame. Not a good president.

Finally, about stimulus - eventually government runs out of other people’s money. Eventually everything would be government. Soviets, Nazis and Maoists tried this kind of control. It doesn’t work.

The great liberal/socialist economist John Kenneth Galbraith contended that Hitler solved the problem of the depression in Germany and I suppose he was right. But is that a price you want to pay?

Re growth - it has been back by anemic.

Posted by: C&J at February 4, 2012 10:04 PM
Comment #335641

It is correct that the government does not run the economy, however they do certainly effect it. They print the money, they regulate commerce,they create a substantial demand etc. Its an easy arguement to point out that it was their failure to adeguately regulate the banking industry that led to the failure.
The BO stimulus was no where near the largest stimulus in history. It was not even close to WW2 spending for example.We are in an unusual economic circumstance. The private sector has plenty of cash but nowhere to spend it. Inflation is low. Federal bond rates are near zero, some categories even have a negative return. The only institution capable of the stimulus needed is the government. Instead of tomato anologies lets look at a car driving up an icy hill. If it does get going fast enough it will not make it. That describes the BO stimulus. The problem with that is it makes it that much harder to get started again. Inability to pass additional jobs measures shows that. This was predicted by many at the inception.Austerity, doing even less to get the car going is certainly no not going to get it up the hill.
The Clinton boom was not just luck as you well know. Federal policy had large part to do with it. At THAT point in time the deficit had the effect of eating up capital. The government was”the biggest pig at the trough…Bill Clinton”. For the express purpose of freeing that capital the administration and a Democratic congress passed the Clinton economic plan without one Republican vote. Moderate tax increases for the upper brackets and selective spending cuts balanced the budget and freed up the capital used in the dot com boom. That situation was very different from the situation we are in now. There is plenty of capital available. The overnight rate is at the zero boundary. This calls for a different solution and major cutbacks in spending are just opposite of what is needed.
If, God forbid, Rohmny gets elected I am curious as to what he calls the stimulus plan he proposes. He is a sharp cookie and can read the writing on the wall. That is what the economy requires. Eisenhower sold the interstate highway project as a defense measure. JFK sold the Moon race as similar etc.

Posted by: bills at February 5, 2012 1:49 AM
Comment #335642

BTW,,,The Chicago is dead. None of their predictive models hold up faced with actual economic data. They have become more of a dangerous cult than an economic school and like cloistered monks they do not even talk with those of a different beiief. Like all religions they require no proof. Fine. I hate to disagree with a mans religion but it would be helpful if they would stop the pretense
that they know what they are talking about regarding public policy.

Posted by: bills at February 5, 2012 2:01 AM
Comment #335643

C&J-
Yes. You can take more of a lesson from it than it has to teach. Question is, have I? And in what way? You imply overreach, but there’s nothing specific in your comment to challenge something specific I’ve said. It’s more you patting me on my head, patronizing me for what you consider my naivete. That shouldn’t be good enough for anybody here.

Much of your underlying assumption is based on input produce outputs in a predictable way.

The Bush Tax Cuts were based on the same idea as the Reagan Tax Cuts. The prediction of the Republicans, at least for the benefit of the middle class was increased job growth, due to increased economic activity on the part of the rich.

Each tax cut essentially failed. The first Bush tax cut of any note was passed and signed in June of 2001 I like this quote from the Wikipedia article:

The Heritage Foundation predicted the cuts would result in the complete elimination of the U.S. national debt by fiscal year 2010.

The net job loss from that point to the point where things finally turned positive, over two years later, total about 2.227 million. The final result of the Bush Tax cuts, according to our friend’s chart, was an addition of $1.8 trillion to the deficit under Bush. Similar increases to the deficit occured under Reagan, and a similarly long time between when the signature tax cut was signed, and when the economy actually recovered. I mean, you blame us for predicting that the economy would never go above 8.5% unemployment, well, It’s May 1984 before Reagan even breaks even on that score. That’s not much fast than Obama, and with a little over half the GDP damage to repair, not to mention a longer time at higher unemployment.

So, again, Republicans are getting themselves into bigger pickles with smaller recession, and spending just as much time, if not more, in the doldrums Obama is.

Bad and good are complex, but the context seems to be that Republicans are facing lesser challenges, and making more of a mess of fixing the economy. You claim you don’t believe in simple causes when it suits you, but then you turn around and allege things like the virtues of tax cuts.

As far as stimulus goes? Reagan increased the debt by two trillion dollars during his administration, and with his Fed Chairmen threw the doors open to cheaper rates. You talk about optimism? Well, Obama’s been frank when he had to be, but he’s always said that Americans can find a way to grow the economy, and he’s always been talking up America’s workers, students, and businesses. Pessimism and Blame? That’s simply a propagandist’s caricature, or at best a simple personal opinion you can’t back up.

As far as running out of other people’s money, the bond yields haven’t gone up much, even in the wake of America’s first credit downgrade ever. Despite your panic, pessimism, and blame of Obama for our debt problem, our credit remains good. About the only thing that would really drive that up would be another debt ceiling debacle, or some sort of economic collapse. So long as we keep our spending moderate, which Obama’s done if you’ve objectively looked at how much the budget’s shifted, and for what reason, you don’t have a problem.

The real trouble is that we’re in a bad economy, and simply cutting jobs and cutting government’s economic input has not produced the kind of results you allege.

You say the economy’s dragging. Would the fact that the Public Sector’s shed two-thirds of a million jobs have produced a drag effect on the economy?

You talk about Keynes, but you forget a detail in your vain attempt to vilify his political philosophy (which you, the tax cut in a time of deficit fan, should be honest enough to admit you’re employing): We used Keynes’ method, too. We pumped hundreds of billions of dollars into the economy during WWII and the Great Depression.

As far as anemic job growth, 240K isn’t where I want to stay, but if it keeps up we’ll be much better off. We’ll at least be doing better than Reagan did until April 1983 or Bush did until March of 2004. Obama got around there by April or May of 2010, and that’s after having to recover from the worst job losses in about sixty years.

Context matters. Where you start from matters. Obama’s done more than either Reagan or Bush achieved, relatively speaking, and with less at his disposal to set things right.

Posted by: Stephen Daugherty at February 5, 2012 2:24 AM
Comment #335644

j2t2

There are two sides to each equation. Should we just keep on raising taxes to meet any expenditure politicians want to enact?

It is the spenders that have created the debt problem. Both parties have been guilty of this. Debt exploded after the Democrats took over the House in 2006 and it got even worse after Obama won in 2008.

The only time debt was controlled is when Congress really put the screws to the president and the president told us that the era of big government was over.

bills

WWII was not just a stimulus. If we had simply spent that kind of money, it would not have achieved growth. The world eliminated many millions of workers. It destroyed billions of dollars worth of capital. It changed all the political relationships in the world. It regimented and trained millions of Americans. It rationed goods and services. It relaxed anti-trust and pushed production. It froze wages. We could go on. It is not an example of a successful fiscal stimulus; it is a revolutionary change.

Re the Clinton boom - there were a lot of good circumstances. We also were not really preparing for changes. We lived in the time of dot com bubbles and a false sense of security.

Clinton and the Republicans in Congress performed well too. What did they do? They shrunk government. Clinton said the era of big government was over.

Re predictive models - We are in some new territory. I do not believe that we can apply the monetary models of the 1980s and 1990s. But we also certainly cannot go back to the models of the 1960 & 1970s as Obama is doing.

What we need is a paradigm that limits government but respects it. We need a smaller but efficient government. We had the bloat of government followed by a reaction that set government AGAINST business & society and set business AGAINST government and society against both. This is pernicious. Each of these components has tasks that it does best and some that only it can do for all practical purposes.

I am not playing games when I say that I love government. There is no way we can be prosperous w/o a strong and competent government. Out current government is neither. Expanding it might make it stronger in the short run but not more competent.

Stephen

Please read the paragraphs immediately above

“Much of your underlying assumption is based on input produce outputs in a predictable way.

The Bush Tax Cuts were based on the same idea as the Reagan Tax Cuts. The prediction of the Republicans, at least for the benefit of the middle class was increased job growth, due to increased economic activity on the part of the rich.”


These models don’t work either.

“The real trouble is that we’re in a bad economy, and simply cutting jobs and cutting government’s economic input has not produced the kind of results you allege.”

We need competent government that makes good chances, not one that just pisses away money for the sake of spending.

Posted by: C&J at February 5, 2012 8:18 AM
Comment #335647
It is the spenders that have created the debt problem.

The spenders are but one of the three reasons debt has been created. Many conservatives would have us believe that only by cutting spending can we pay off the debt. This of course is nonsense. The reason this is such a foolish idea is the conservatives will then want tax cuts thereby keeping us in debt. They don’t really care about debt as much as they want to achieve their ideological goals.

The second leg is cutting taxes C&J. Intentionally cutting taxes and going to war. Cutting taxes and demanded additional benefits such as part D medicare. Cutting taxes and tying the governments hands when it comes to getting best prices for the government dollar. Spending wasn’t the bad guy here C&J it was the deliberate malfeasance by conservatives insistent upon getting their ideological goals met of cutting taxes when it was just wrong to do so.

The third is the ideological goals of conservatives C&J. The vague ideology of small government, what does it mean? To conservatives it means small taxes. Which gets us Mexico. The vague ideology of uber capitalism over all which has decimated the middle class, those that pay their fair share, and left the corporations running the country. Prosperity for the few cause we work harder than they do.

Posted by: j2t2 at February 5, 2012 10:56 AM
Comment #335648

j2t2

You are as bad as the conspiracy theorists on the right who think the Obama is trying to destroy American power in pursuit of anti-colonial dreams of his father.

But I suppose the direct mirror of your conspiracy theory are those who think Obama is deliberately spending money so that he can push higher taxes later.

Both sides have their nutty extremes. It is probably best to avoid both.

Re becoming Mexico - Mexico has a tax rate of 30%. Capital gains are taxed at that rate too, unlike the U.S. and Mexico has a value added tax. Overall, taxes and government influence in the economy are higher in Mexico than they are in the U.S. Like most poorer countries, Mexico is not high on the economic freedom index.

Posted by: C&J at February 5, 2012 11:10 AM
Comment #335650

C&J-
We had a balanced budget, and Democrats like me were pleased to keep it that way. We got the prestige of being responsible. I’m pretty sure that Obama would have rather he come in with more of a clean slate.

Trouble is, Obama’s having to deal with a massive economic crisis. For some strange reason, a party that justifies tax cut after tax cut, deficit dollar after deficit dollar on the notion that economic necessity trumps fiscal probity turns around, and when this country really needs economic help, they say no.

Isn’t that funny? We rush to pay in order to handle relatively small economic problems, run what were then record deficits on the theory that the economy was too fragile to take spending cuts or tax cuts… And then we get into real trouble, and all of a sudden, we can’t afford to act.

Borrowing in good times to pay back things when we’re poor. We can’t help that you ran up trillions of dollars in debt when you had the revenues to pay for everything, when we were a prosperous and growing economy, but these are times of emergency. We should have been saving back surplus in times of prosperity to spend now, but the failure to do so was your party’s fault, the result of policies which played on people’s greed, rather than appeal to people’s sense of responsibility.

We will have to pay for this nation’s recovery, one way or another. We can pay with years of falling below our potential, or we can push this nation’s economy back where it needs to be, and avoid that indefinite cost of inaction.

As it is, we’re growing, and faster than expected. we’re doing this even though government at all levels is spending less, pumping less into the economy. Our jobs numbers have been repeatedly weighed down by layoffs, and the politically motivated right sees no problem in this, even though practically a lost job is a lost job, and that person is still going to get in the line for unemployment and become part of that statistic.

The truth is, I am a deficit hawk in normal times, and a Keynesian in times of crisis. We do what we have to do, and then we exercise fiscal discipline to pay for it afterwards.

We haven’t done what we needed to. You say as much yourself. But do you realize that your ideas are pretty much as Keynesian as mine? Why else back a tax cut that has the first order consequence of increasing the deficit?

No, the real problem is that Republicans no longer register the consequences of their actions. They merely insist that their results will come about as intended. I have personally experienced more than thirty years of unintended results from those policies. It’s time for the Republicans to start getting reality checks in the mail.

We’re watching carefully to see how things work. The Republicans should stop trash-talking recovery, and admit it’s actually happening, that things are getting better, if at a slower pace than we’d prefer. They should stop getting the way, and start helping this country recover, if for no other reason than their failure to come to their country’s aid, their willingness to risk further economic distress with their policies will come back to haunt them on election day.

The real pessimists, the real doomsayers are on your side, and they’ve been nothing but, because to admit that Obama might be right, that he might have succeeded, will be a declaration of defeat for the pure brand of conservatism that has taken over your party.

But don’t you get it? Even your own candidates are using the rhetoric of the left! They’re piling on Romney for being an economic elite, exploiting the desire even among Republicans for greater economic fairness.

Defeat has already occured. Whether this is acknowleged or not, whether you make your peace with this or not will decide the political future of your party.

Posted by: Stephen Daugherty at February 5, 2012 11:12 AM
Comment #335651

C&J-
I think it will take more than similar tax rates to make us economically or politically like Mexico. I mean, if we’re talking the full appreciation of the complexity of something like a nation.

Posted by: Stephen Daugherty at February 5, 2012 11:14 AM
Comment #335653
You are as bad as the conspiracy theorists on the right who think the Obama is trying to destroy American power in pursuit of anti-colonial dreams of his father.

In what way C&J? “Starve the beast” is a real conservative theory that has been used whilst the righties have no basis in fact for their conspiracy theory you mentioned.

Both sides have their nutty extremes.

Yes they do C&J. Many more on the right because they don’t have the reality based thing to deal with IMHO. But starve the beast isn’t a conspiracy theory it is fact, A fact that many conservatives don’t want publicized, which is perhaps why you have decided upon an “attack the messenger” mode here.

http://www.forbes.com/2010/05/06/tax-cuts-republicans-starve-the-beast-columnists-bruce-bartlett.html

Posted by: j2t2 at February 5, 2012 11:48 AM
Comment #335658

Stephen

The budget was not balanced until we had a Republican Congress and lots of good luck. Remember that according to the constitution all bills relating to revenue and spending must originate in the House of Representatives.

Re spending - we had record revenues in 2006. If Federal spending had remained at the same level as it was in 1999, we would have enjoyed a surplus. So why don’t we just bring spending down to 1999 levels (adjusted for inflation and population. I would support that we tax to support that level of spending. Do we agree?

Re Mexico - I didn’t compare us to Mexico. I was responding to the comparison and pointing out why it was not true.

Re the recovery - It happened w/o Obama and much later than he said. Whether this is acknowledged or not, whether you make your peace with this or not will decide the political future of your party.

j2t2

But “starve the beast” is a way of making government accountable, not writing a blank check. You extrapolate other motives. This is the same as those who take what Obama says re America’s appropriate role and extrapolating that he wants to break American power.

If you take this “starve the beast” to mean a desire to destroy government, we have found at least one nutty conspiracy theory on the left.

Posted by: C&J at February 5, 2012 12:13 PM
Comment #335662
But “starve the beast” is a way of making government accountable, not writing a blank check.

No it’s not C&J. Unless you think government is somehow more accountable now. The fact is it was a desperate attempt by conservatives to take us back to the gilded age. Holding the government accountable by spending and borrowing while cutting taxes was intentional, a plan by conservatives to cut the budget and programs deemed by conservative ideology to be unworthy. You guys wanted to be rid of SS and Medicare to name a few.

The way to make government “more accountable” is to be fiscally responsible. The repubs/conservatives had the chance to do so but failed, failed their country by being fiscally irresponsible whilst blaming the dems. Just facts C&J.

Now when this STB plan was initiated back in the late ‘70’s by conservatives it may have been planned to hold government accountable. But after 20 years and proof of the failure of this strategy to hold government “more accountable” it was not dropped. In fact like most things conservative the choice was made to double down on this strategy. Or as I say intentional harm to the country by using failed conservative ideology was used. To make matters worse STB has now been used as a means to get at targeted programs by those Tea Party members of Congress such as Bachmann. So despite your claims of conspiracy theory you are wrong about me and starve the beast. Some conservatives such as Frum and Bartlett seem to be able to deal with this truth, others attack the messenger with outlandish claims.

Posted by: j2t2 at February 5, 2012 1:30 PM
Comment #335663

j2t2

I do not believe that politicians and bureaucrats have any incentive to limit spending unless they are on a limited budget. In fact, the political and bureaucratic incentive is to spend more, as government assessment procedures tend to use the input of resources as a measure of success, i.e. an officer who runs a $5million program is better than one who runs a $1 million program since actual outcomes are very difficult to measure.

Re SS and Medicare - those were funded by their own mechanism. They have not been starved, and on the contrary have expanded. Some may not like them, but they are beside your point.

The beast, however, has failed to shrink and in fact has grown. Spending has grown.

I gave the challenge above and will do it again. I would advocate bringing spending in line with what it was in 1999 (adjusted for inflation and population) and tax to meet that level. I can even accept a slight increase to pay interest on new debt since that time. If we do back to that as a baseline, the last time we both agree things were okay, then we could talk about which specific programs should grow and which should die.

Posted by: C&J at February 5, 2012 1:43 PM
Comment #335664

Re attacking the messenger - the idea that a serious leader - serious leaders (plural) who have represented more than half of American voters - would purposely seek to harm the United States is indeed crazy.

I believe that continued growth in spending harms our country. It is like the fat man who keeps on eating donuts or the drunk who keeps on boozing. It doesn’t help to keep on supplying donuts and whiskey and cutting his intake of such things is not an attempt to do him harm. I regret that the incentive to spend has generally outrun the idea of being responsible. This has been the fault of both parties. The only Congress that made serious cuts was the Republicans under Clinton. Republicans have not really done it since and no Democrats have even made the attempt.

Posted by: C&J at February 5, 2012 1:48 PM
Comment #335665
Re attacking the messenger - the idea that a serious leader - serious leaders (plural) who have represented more than half of American voters - would purposely seek to harm the United States is indeed crazy.

C&J, Crazy but true. Read the link. The conservatives/ Republican Party did just that during the GWB administration despite all evidence from the previous 20 years that STB didn’t serve it’s intended function. It happens when ideology runs amok amongst people that are resistant to change.

The other option is just as crazy. The repubs didn’t know they were harming the country during the GWB administration when they went to war while cutting taxes, expanded medicare without paying for it, and designed the tax cuts to be permanent without knowing. But if that is the case it is just scary, why would we trust them to run the country.

Posted by: j2t2 at February 5, 2012 2:32 PM
Comment #335669


J2t2, Conservatives would rather admit that Bush and even Reagan were stupid than to admit that starving the government of revenue while increasing the size of government and running up a massive debt was deliberate.

Far better to admit culpability by reason of stupidity. It is a shame that the RINO’s got cold feet and reneged on the social agenda.

Reagan and Bush, both reduced taxes on wealth and business dramatically. Both went on a Defence budget spending sprees. Both increased the size of government. Both combined to leave the country with 9 trillion in debt. Their legacies are that their conservative philosophies left the government and the country in such a sorry state that their was no recourse but to raising taxes, and or increase the debt, or make draconian cuts in government programs, especially social programs and regulatory authority. It was deliberate. They knew what they were doing and they have not let up.

The fact that they have not let up, that they are still pushing for a continuation of their failed policies is evidence enough of these results being a deliberate policy approach. They put this country in this state by fulfilling half of their agenda and now they are pushing to finish the job.

Posted by: jlw at February 5, 2012 3:25 PM
Comment #335670
I believe that continued growth in spending harms our country.

Based upon what C&J? The current situation where we are borrowing because the STB inspired tax cuts spending and borrowing have left us in the hole? Or based upon things being good in ‘99? Do the dems have a spending plan that has proven to be harmful to the country based upon any factual information?

What is harmful to the country is sticking to the STB plan and becoming the “do nothing” Congress that allows the fiscal problems to compound. It is time for conservatives to tell their elected representatives to give up the STB plan and get real with the economy, stop playing politics with the economy and for the sake of the country let their failed ideology go and work towards fixing the country.

Posted by: j2t2 at February 5, 2012 3:26 PM
Comment #335671

jlw, It seems to me they have done this intentionally as well. The problem is as C&J says, over half the country represented by the repubs/conservatives believes their policies work. Not based upon fact but based upon the misinformation put forth by TRC’s, well that and waving the flag while doing so.

Posted by: j2t2 at February 5, 2012 3:31 PM
Comment #335673


Plus guns, gays, and God.

The Obama Administration has not helped the economy, they have actually hurt the economy.

That is why corporate profits set an all time high in the fourth quarter of 2011 and are expected to do even better in 2012.

That is why the manufacturing base is going strong and expected to get stronger.

That is why consumer confidence is up and more importantly, despite the unemployment, why they are spending money. Consumer spending is at a record high average of $400 billion per month.

That is why oil is expected to drop to $80 per barrel.

That is why the negatives like a double dip recession and Europe’s now manageable problems have been discounted by investors.

That is why many are beginning to say that now is the time for investors to get over the negativity kick and to jump in feet first.

That is why if you are hoarding gold, now is the time to divest.

Posted by: jlw at February 5, 2012 5:45 PM
Comment #335675

j2t2

My son, who I love very much, pisses away money. I had to cut the amount of money I was giving him. I could afford to give him more and it would have made me happy to do it, but I needed to bring him in line. We taxpayers need to do that with the politicians and bureaucrats. They are not usually bad people and they may be acting from good motives, but if we don’t keep them in line, it does nobody any good.

j2t2 and Jlw

Both Reagan and Bush managed to get MORE total money from the rich and the proportion of taxes they pay is higher than it was when marginal tax rates were lower. You can get them to pay more or you can chase the chimera of abstract “fairness” by pushing up rates. Tax rates were a little too high in 1999. They may be a little too low now, but we have to adjust them to maximize revenue, not to further ideology on either side.

re spending - we were better off in 1999 when we were spending less. Again, I say let’s go back to those spending levels and tax to meet that spending. This is a very moderate position. That was a time when Democrats and Republicans both had a say in things and when we mostly all agree that things were okay with the economy.

Posted by: C&J at February 5, 2012 7:05 PM
Comment #335681

C&J, keeping them in line by demanding borrowing and spending while cutting taxes to increase the deficit seems to me to be a policy that not only sounds foolish on it’s face but also resulted in not keeping them in line.

Posted by: j2t2 at February 5, 2012 8:22 PM
Comment #335689

C&J-
So you’re telling me the spending cuts and tax increases at the beginning of the 90s had nothing to do with it, right? If we had any doubts of who really deserves credit for fiscal discipline, we have only to look to those who, in a good time, applied austerity measures at the appropriate period in our economic cycle.

If you look at the numbers with the Republicans, you see an immediate explosion in the deficit once they get into power because they don’t balance any of their tax cuts with spending cuts, or spending increases with tax increases. They did both tax cuts and spending increases at the same time.

Apart from the emergency financial bills, Obama’s been deficit neutral by design on his biggest spending projects. He’s either raised money from somewhere else, or raised taxes. Now you might say that it’s all budget gimmickry, but even so, he at least paid for his expansions of certain government services, which is why the budget deficits aren’t going up.

By the way, less than five percent of any new spending belongs to Obama. The rest is a legacy of your times.

It seems the problem here is that Republicans are not facing up to what they’ve actually done, to what the consequences of their policies actually have been, that their policies have been the driving force behind the record deficits. Take out the effects on revenues by the bad economy, and you have two wars that weren’t paid for, a Medicare drug benefit and Medicare Advantage increases that weren’t paid for, and a huge tax cut that was deliberately not offset by spending decreases at the time it was done.

Where do you have to hide here from your own policies? Even if you say “Well you continued them,” you still started them. The record spending you blame on us is your record spending.

But of course, if you accept responsibility, you have to lay off the tax cuts, and you have no moral high ground on big government. Concessions like that cost. So you don’t do it. Only problem is, if you don’t acknowledge that your fiscal policies don’t add up, they’ll never stop causing deficits. If you don’t admit that Reagan and the two Bushes had it wrong, your rises to power will always have the opposite effect of what you desire.

The calculus has never overwhelmed the arithmetic on economic disparity, anti-tax crusades, and Republican spending. Your theories never panned out.

As for returning to 1999’s spending and tax levels? How about we look at our actual situation, and budget and tax appropriately to that, instead of making a mostly symbolic return to one year’s policy?

And as for what Reagan and Bush did, regardless of what record amounts of money they got from these people, that didn’t prevent both from running massive deficits.

If you don’t admit to and perceive your errors, Republicans will always talk the balanced budget talk, but walk the deficit spending walk instead. The expectations and the results have not parted ways by sheer misfortune. Your policies simply don’t do the job right.

Posted by: Stephen Daugherty at February 6, 2012 8:53 AM
Comment #335737


C&J, I guess we can thank God that the Bush tax cuts, while they did not produce jobs as claimed, did produce more tax revenue for the government, and without that, what the Republicans did to the country would have actually been worse.

Stephen, that was then and this is now. Republicans have learned their lesson and just as soon as Obama and the Democrats are history, next January, they are going to prove it by gutting the governments participation in entitlement programs, eliminating much of the government’s regulatory authority, and slashing discretionary spending, so that they can assure the people that the government can afford their future preemptive wars and future tax cuts.

If Newt is the next president, the Republicans will also be turning the public schools over to the local evangelical authorities, giving black people jobs to replace their food stamps, purging the government of liberal workers, and turning the Moon into the 51St state.

Posted by: jlw at February 7, 2012 1:09 AM
Comment #335772

jlw-
I wouldn’t credit the Bush tax cuts for the extra revenues, I would credit the reinflation of the Wall Street speculation bubble. Unfortunately, the financial sector took with it what it gave. You could say that the lower deficits in the middle of the decade were simply deferred to the beginning of this one.

Posted by: Stephen Daugherty at February 7, 2012 2:20 PM
Comment #335796

Stephen

I think controlling the size of government had a lot to do with it. To the credit of Clinton & the Republican Congress, government spending as a % of GDP declined during the late 1990s.

Re your contention that less than 5% of the spending belongs to Obama, I question that number but let’s take the logic. Obama ‘Inherited” big spending. He did nothing to cut it back and actually added another 5%.

So if you inherit a house in bad repair, you think it is perfectly fine to blame the previous occupant and make it 5% worse rather than improve the situation?

You just are telling us that Obama is not up to the job.

Maybe I missed it. Did you join me in advocating that we return to the spending levels as % of GDP that we had in the good year of 1999 and then adjust taxes to pay for that, no more or less?

Posted by: C&J at February 7, 2012 5:26 PM
Comment #335813


Obama inherited a whole lot more than just big spending.

When you inherit a house in ill repair, you put more money into it to keep it from falling down, or you let it fall down.

Obama made the economy worse, but thank God for Republican governors. Go ahead and try to sell it.

C&J, your scenario doesn’t account for the debt.

Posted by: jlw at February 7, 2012 7:47 PM
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