Right-leaning Wall Street Journal admits the stimulus bill is working.

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    Mar 17, 2010 7:19 PM GMT
    http://online.wsj.com/article/SB125185379218478087.html

    And the president will be signing the jobs bill into law within the next couple of days.

    It's so great to have a president on the job, pulling the country out of the Bush recession.
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    Mar 17, 2010 7:56 PM GMT
    Excellent. This President has been in an office for a year and inherited an unbelievable mess (including the bank bail-out.) Short memory folks forget it took Bush eight years to take us from a surplus to the mess he dumped in Obama's lap.
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    Mar 17, 2010 9:36 PM GMT
    Joe52 saidExcellent. This President has been in an office for a year and inherited an unbelievable mess (including the bank bail-out.) Short memory folks forget it took Bush eight years to take us from a surplus to the mess he dumped in Obama's lap.


    While I've posted it a few times now, Obama very much had a hand in the bank bailout and the deficits today. For comparative purposes, have a look at the actual numbers:

    Just a reminder of historical/temporal context and deficit spending / "bad fiscal policy" - this is from Washington Post March 21, 2009 (http://www.washingtonpost.com/wp-dyn/content/graphic/2009/03/21/GR2009032100104.html) and doesn't include the additional trillion in estimated spending from healthcare if it does actually get passed (not to mention any additional "stimulus" packages that get passed)

    GR2009032100104.gif

    Since the date of this graph, the projections have gotten worse! Sure there's been borrowing from the Chinese, and monetary policy was hideously handled and sure there were tax cuts but that's nothing compared to what's happening now and estimated to come. From March 5, 2010 (the Hill): http://thehill.com/homenews/administration/85237-cbo-estimates-huge-deficits-average-1-trillion-per-year-for-the-next-decade -

    "The independent CBO and Obama expect a similar amount of government spending over the next 10 years -- about $45 trillion. But the CBO expects Obama's policies to bring in $35.5 trillion in tax receipts, less than the $37.3 trillion expected by the White House." - that's almost $1 trillion dollars per year.

    More here: "The CBO's prediction for this year's deficit -- $1.5 trillion -- is 56 billion less than the White House estimate largely because it expects less federal spending. The deficit for this year is on pace to top last year's record budget shortfall of $1.4 trillion, according to another CBO report."

    It is useful to remember that the largest deficit spending under Bush didn't even approximate these levels - including any war spending (which is indeed included in the graph) - and that the supposed money borrowed to pay for tax cuts have already expired.

    Finally, for a look at how well stimulus has worked - well... the data for most of 2009 is in - and it hasn't. Not sure why a WSJ link from an article is being posted now when it was written in September - http://www.marginalrevolution.com/marginalrevolution/2010/03/sentences-to-ponder.html
  • HndsmKansan

    Posts: 16311

    Mar 17, 2010 9:39 PM GMT
    Surprised they made the observation, considering their views, but I've always considered it a "main stream publication" or media outlet... much different than FOX, which has an unprofessional right slant.
    Excellent.
  • coolarmydude

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    Mar 17, 2010 9:44 PM GMT
    riddler78 said
    It is useful to remember that the largest deficit spending under Bush didn't even approximate these levels - including any war spending (which is indeed included in the graph) - and that the supposed money borrowed to pay for tax cuts have already expired.




    It's even more useful to remember that Obama, or any other logical President after Bush, would have had to enact a stimulus bill to fix the mess that Bush left behind. But conservatives refuse to believe that their man isn't responsible for it in the least bit. I've said it before and I'll say it again: Let's raise taxes on all those who voted for Bush and double that for all those who voted to re-elect him! That'll shore up your concerns on the deficit.
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    Mar 17, 2010 9:45 PM GMT
    HndsmKansan saidSurprised they made the observation, considering their views, but I've always considered it a "main stream publication" or media outlet... much different than FOX, which has an unprofessional right slant.
    Excellent.
    Except they didn't make the observation. It was reported as news at the end of September. New data suggests that there was no net effect as a result of the stimulus at least for 2009. Economists hypothesize that federal funding simply offset state funding which has been contracting.
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    Mar 17, 2010 9:50 PM GMT
    coolarmydude said
    It's even more useful to remember that Obama, or any other logical President after Bush, would have had to enact a stimulus bill to fix the mess that Bush left behind. But conservatives refuse to believe that their man isn't responsible for it in the least bit. I've said it before and I'll say it again: Let's raise taxes on all those who voted for Bush and double that for all those who voted to re-elect him!

    This assumes that the stimulus had any effect at all or will have an effect except for a hangover of higher debt and interest payments - which will retard future growth - and that's going to cost everyone - most of all the poor. Ironically many amongst the ultra rich - or at least those who don't have to earn much income any more are for tax increases (e.g. George Soros, Warren Buffett to name two billionaires).

    I can't speak for conservatives but I do know of a number who had been pretty upset with Bush's domestic spending and policies. Instead of framing the issue as Democrats and Republicans, why is it so difficult to look for an appropriate solution and the underlying data?
  • coolarmydude

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    Mar 17, 2010 9:57 PM GMT
    "riddler78 said I can't speak for conservatives but I do know of a number who had been pretty upset with Bush's domestic spending and policies. Instead of framing the issue as Democrats and Republicans, why is it so difficult to look for an appropriate solution and the underlying data?"

    Because you said, "It is useful to remember that the largest deficit spending under Bush didn't even approximate these levels - including any war spending (which is indeed included in the graph) - and that the supposed money borrowed to pay for tax cuts have already expired."

    This implies a Republican vs. Democrat comparison. What I'm saying is that the effect of Bush's policies require the massive spending that you see under the Obama's administration in order to correct the costliness of Bush policies.

    And the only thing I heard conservatives put off about Bush after his reelection was how he was stiff-arming the religious right with their social agenda. There was nothing said about spending concerns until after Obama got elected and before he was inaugurated.
  • GQjock

    Posts: 11649

    Mar 17, 2010 10:01 PM GMT
    Rid ... what about the Macro-economic mess that we were in and still reeling from do you NOT understand
    without that stimulus money we and the rest of the world's banking institutions would have gone belly up
    There is no debating that
    You see the way towns and state govt's are cutting back? If there were no stimulus local govt's would have ceased to function
    You don't worry about decorating on a sinking ship
    According to the Keysian model when the government is the last to have funds to stimulate an economy that has stalled ... you have to use those funds

    As far as Healthcare
    It's either you do something Now ... when it's least painful or wait a few years and let it collapse on its own
    Because it will .... this is COMPLETELY unsustainable
    we are at present spending one dollar out of EVERY six on healthcare and that has been going up steadily and will continue to do so unless we reign in the cause
    and that is insurance costs
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    Mar 17, 2010 10:08 PM GMT
    coolarmydude said"riddler78 said I can't speak for conservatives but I do know of a number who had been pretty upset with Bush's domestic spending and policies. Instead of framing the issue as Democrats and Republicans, why is it so difficult to look for an appropriate solution and the underlying data?"

    Because you said, "It is useful to remember that the largest deficit spending under Bush didn't even approximate these levels - including any war spending (which is indeed included in the graph) - and that the supposed money borrowed to pay for tax cuts have already expired."

    This implies a Republican vs. Democrat comparison. What I'm saying is that the effect of Bush's policies require the massive spending that you see under the Obama's administration in order to correct the costliness of Bush policies.

    And the only thing I heard conservatives put off about Bush after his reelection was how he was stiff-arming the religious right with their social agenda. There was nothing said about spending concerns until after Obama got elected and before he was inaugurated.


    That might be the type of conservatives you've been hanging out with icon_wink.gif. You're right though, Bush's spending was horrible - and he was a Republican, but on an objective basis that's nothing compared to what is now projected. I really don't see the spending under Obama correcting much of the pre-existing problems. I'm curious - were you for the bail bailouts and automaker bailouts?

    Setting aside partisanship for a moment - effectively these two measures bailed out unions and rich bond holders who didn't do their own homework. Something had to be done about the banks - given that a complete loss of confidence in the financial sector would have been disastrous and could have caused a liquidity crisis (a la "It's a Wonderful Life") many banks to fail. I accept this. The key was avoiding the crisis to secure the funds of depositors and avoid a panic. An alternative solution for the bank bailouts could have been rapid restructuring/bankruptcy where the Fed took over on a Friday, restructured the debts/equities and had the bank re-open with new management on a Monday. Instead, they took the far more expensive route.

    Further, have we come further on gay rights as a result of Obama? For some time, I've thought that the democrats truly take many minorities for granted. I personally would have voted for Obama on this basis if I were American in an attempt to move beyond race baiting politics (and I'll even concede on this point that there are many closed minded racist, homophobic, etc Republicans who haven't done the party any favors).
  • coolarmydude

    Posts: 9190

    Mar 17, 2010 10:10 PM GMT
    "I'm curious - were you for the bail bailouts and automaker bailouts? "

    I was against them because there are no regulatory controls that went with them. We were promised there would be and it finally came out this week, but I haven't read up on them yet.

    "effectively these two measures bailed out unions"


    NO IT DIDN'T! The GM union made concessions in order to get the bailout. They didn't gain a thing.
  • coolarmydude

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    Mar 17, 2010 10:15 PM GMT
    southbeach1500 said
    Keep more money in the private sector where it can grow more jobs.



    Yeah. Overseas! icon_wink.gif
  • coolarmydude

    Posts: 9190

    Mar 17, 2010 10:18 PM GMT
    riddler78 said
    Further, have we come further on gay rights as a result of Obama? For some time, I've thought that the democrats truly take many minorities for granted. I personally would have voted for Obama on this basis if I were American in an attempt to move beyond race baiting politics (and I'll even concede on this point that there are many closed minded racist, homophobic, etc Republicans who haven't done the party any favors).



    Where did this come from? What does this have to do with the stimulus?
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    Mar 17, 2010 10:19 PM GMT
    GQjock saidRid ... what about the Macro-economic mess that we were in and still reeling from do you NOT understand
    without that stimulus money we and the rest of the world's banking institutions would have gone belly up
    There is no debating that
    You see the way towns and state govt's are cutting back? If there were no stimulus local govt's would have ceased to function
    You don't worry about decorating on a sinking ship
    According to the Keysian model when the government is the last to have funds to stimulate an economy that has stalled ... you have to use those funds

    As far as Healthcare
    It's either you do something Now ... when it's least painful or wait a few years and let it collapse on its own
    Because it will .... this is COMPLETELY unsustainable
    we are at present spending one dollar out of EVERY six on healthcare and that has been going up steadily and will continue to do so unless we reign in the cause
    and that is insurance costs


    Alright - I'm glad you're at least open to asking the questions. The stimulus money didn't help the world banking institutions. The bank bailouts and stimulus are two separate issues (and a rapid restructuring type form of legislation empowering the Fed could have been far more effective and real change).

    The last stimulus was more about bailing out the states and some infrastructure spending than actual stimulus if you look at the underlying data. ie States have cut funding, and are losing money so the US Federal government poured money into largely things like education spending to plug the holes. Further, even for infrastructure spending - if you ask someone like Keynes - he argued that infrastructure spending was not an effective form of stimulus.

    Christine Romer, the expert on the Great Depression that Obama hired has published several papers on the effect of both tax increases and tax reductions pointing out that tax increases have 3x a negative effect on a slow environment - and one of the primary causes for the economy to dip back down 1937-8. I note that the tax cuts also expired this past year - effectively a form of stimulus that had to be made up for.

    The problem now and going forward with the stimulus however, is that states and municipalities who, as you point out, are running out of money largely because they grew substantially faster than their tax bases, are having problems making ends meet. But this won't be a problem limited to this year, next year it'll happen again as well - and this isn't stimulus at all - it's a state bailout.

    As far as healthcare goes, there are other solutions. I accept that there needs to be reform and I'd be a strong advocate of it, but this seems like a horrible bill on multiple levels. I'm guessing you'd also agree that it doesn't go far enough and that concessions were made to bribe certain senators into agreeing to the bill. I, on the other hand, would argue that incremental change would be better. Given how poorly Medicare is run, how can you trust the Feds to run it better. Keep in mind that the US spends more per capita on public healthcare than Canada - clearly something is broken particularly since in Canada everyone is eligible for healthcare - not so for the US with Medicare.

    What I've never understood about partisans who paint Republicans as pure evil or buffoons, is that there seems to lack a certain recognition that governments change. Would you want the equivalent of a Dick Cheney to be deciding what you get for your healthcare?
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    Mar 17, 2010 10:20 PM GMT
    coolarmydude said
    riddler78 said
    Further, have we come further on gay rights as a result of Obama? For some time, I've thought that the democrats truly take many minorities for granted. I personally would have voted for Obama on this basis if I were American in an attempt to move beyond race baiting politics (and I'll even concede on this point that there are many closed minded racist, homophobic, etc Republicans who haven't done the party any favors).



    Where did this come from? What does this have to do with the stimulus?


    Nothing to do with stimulus - sorry, I wasn't clear in referencing this sentence: "And the only thing I heard conservatives put off about Bush after his reelection was how he was stiff-arming the religious right with their social agenda. There was nothing said about spending concerns until after Obama got elected and before he was inaugurated."
  • coolarmydude

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    Mar 17, 2010 10:21 PM GMT
    southbeach1500 saidProof to support your statement?


    http://www.aflcio.org/issues/jobseconomy/exportingamerica/outsourcing_problems.cfm

    http://www.cnn.com/CNN/Programs/lou.dobbs.tonight/popups/exporting.america/content.html
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    Mar 17, 2010 10:26 PM GMT
    coolarmydude said
    southbeach1500 saidProof to support your statement?


    http://www.aflcio.org/issues/jobseconomy/exportingamerica/outsourcing_problems.cfm


    The problem with the AFL CIO's numbers is that they don't point out the job growth as a result of the outsourcing. I see outsourcing sort of like a disruptive innovation. All of a sudden you have access to some tool for productivity that generates better returns.

    I'm guessing you haven't had much experience with respect to outsourcing itself though - you can't really outsource the higher levels of thinking. The US remains the largest manufacturer and exporter in the world at least insofar as dollar figures go.

    What I would concede though is that outsourcing does get rid of a lot of union jobs because they tend to be overwhelmingly blue collar in nature given that the skill sets are less differentiated than overseas. You really don't get the level of creative thinking or problem solving from offshore at the moment.
  • stevendust

    Posts: 398

    Mar 17, 2010 10:27 PM GMT
    As a rule of thumb, I typically disbelieve any article that uses such bullshit language as "actual numbers" because in reality they lie just as much as words do. Just because you put the word 'actual' before numbers does not make it truthful or unbiased.
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    Mar 17, 2010 10:28 PM GMT
    coolarmydude saidriddler78 said
    It is useful to remember that the largest deficit spending under Bush didn't even approximate these levels - including any war spending (which is indeed included in the graph) - and that the supposed money borrowed to pay for tax cuts have already expired.




    It's even more useful to remember that Obama, or any other logical President after Bush, would have had to enact a stimulus bill to fix the mess that Bush left behind. But conservatives refuse to believe that their man isn't responsible for it in the least bit. I've said it before and I'll say it again: Let's raise taxes on all those who voted for Bush and double that for all those who voted to re-elect him! That'll shore up your concerns on the deficit.


    Thank you!
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    Mar 17, 2010 10:32 PM GMT
    riddler78 said
    coolarmydude said
    southbeach1500 saidProof to support your statement?


    http://www.aflcio.org/issues/jobseconomy/exportingamerica/outsourcing_problems.cfm


    The problem with the AFL CIO's numbers is that they don't point out the job growth as a result of the outsourcing. I see outsourcing sort of like a disruptive innovation. All of a sudden you have access to some tool for productivity that generates better returns.

    I'm guessing you haven't had much experience with respect to outsourcing itself though - you can't really outsource the higher levels of thinking. The US remains the largest manufacturer and exporter in the world at least insofar as dollar figures go.

    What I would concede though is that outsourcing does get rid of a lot of union jobs because they tend to be overwhelmingly blue collar in nature given that the skill sets are less differentiated than overseas. You really don't get the level of creative thinking or problem solving from offshore at the moment.


    Wait a minute. Are you saying that outsourcing U.S. jobs to overseas entities strengthens the U.S. job market?
  • coolarmydude

    Posts: 9190

    Mar 17, 2010 10:32 PM GMT
    stevendust saidAs a rule of thumb, I typically disbelieve any article that uses such bullshit language as "actual numbers" because in reality they lie just as much as words do. Just because you put the word 'actual' before numbers does not make it truthful or unbiased.


    Actually, no. icon_wink.gif
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    Mar 17, 2010 10:35 PM GMT
    stevendust saidAs a rule of thumb, I typically disbelieve any article that uses such bullshit language as "actual numbers" because in reality they lie just as much as words do. Just because you put the word 'actual' before numbers does not make it truthful or unbiased.

    That is unless of course you look at something that can be objectively reported like spending numbers and budget numbers as provided by the White House - if you're talking about spending. The graph from the Washington Post, includes actual and compares White House spending numbers with that of the independent CBO. Further, the study that stimulus had a net aggregate demand effect of close to zero doesn't appear to pursue a particularly ideology or point of view.

    The words "actual numbers" were my own, but at least insofar as the budget and historical deficit numbers not sure what else you'd call them icon_wink.gif That said, I am generally disinclined to believe numbers from any partisan source - but I'm more than willing to consider the source of the numbers and how they're framed. And this I hope people do insofar as both the article from the WSJ is concerned and the underlying economic data is concerned.
  • coolarmydude

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    Mar 17, 2010 10:37 PM GMT
    southbeach1500 saidI really don't think that proves your statement.


    Proof to support your statement?
  • coolarmydude

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    Mar 17, 2010 10:42 PM GMT
    riddler78 said, "The problem now and going forward with the stimulus however, is that states and municipalities who, as you point out, are running out of money largely because they grew substantially faster than their tax bases, are having problems making ends meet."


    This is where I totally disagree. Manufacturing and businesses provide a big boost to local budgets that help pay for education, amongst many other things. When these jobs leave due to outsourcing, the tax base shrinks and causes the local budgets to shrink and programs, like education, to be cut. I saw this happening back in 2001-2002 when I lived in Ohio. Job outsourcing started accelerating way back then. Imagine that! icon_wink.gif
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    Mar 17, 2010 10:45 PM GMT
    reppaT said
    Wait a minute. Are you saying that outsourcing U.S. jobs to overseas entities strengthens the U.S. job market?


    I should preface that I'm Canadian so let me be impolitic for a moment to answer "yes". If the jobs being outsourced can be done for a fraction of the cost of what is being done domestically, yes.

    I don't know if you have an iPod or an Apple product - I don't - but look at the margins on those suckers. There's a reason why Apple is an American company not one from China. They do take advantage of Chinese manufacturing - whose manufacturers might make 5% if they're lucky, but the design and development occurs in the US. Of course this means that more people are effectively employed by Apple's products in China than the US - but that could be a good thing given that all the higher dollar and higher value work is still made in the US.

    The data on trade suggests that even when there is a lot of trade - under the Bush and Clinton years, this doesn't lead to higher unemployment. It does however lead to higher productivity. It's the simple rationale for trade - each country/firm does what it does best and outsources the rest so they can reinvest and continue to build on their strengths.

    The arguments against trade in this way are very similar to that of machines and technology and those who fear it insofar as the potential for automation to take away jobs. I personally consider it a really good thing that we don't have as many buggy whip manufacturers anymore or that a quarter of the workforce doesn't sit at switchboards manually connecting calls. Jobs do not get created form making stuff or doing specific tasks, but solving problems and innovating. The less of the lower value stuff and the more of the higher value stuff that countries/economies do, the better things get and the more that gets earned.