Where Are We On The Stimulus?

I again associate myself with the views of the Nobel prize winning economist Paul Krugman:

Would the Obama economic plan, if enacted, ensure that America wonít have its own lost decade? Not necessarily: a number of economists, myself included, think the plan falls short and should be substantially bigger. But the Obama plan would certainly improve our odds. And thatís why the efforts of Republicans to make the plan smaller and less effective ó to turn it into little more than another round of Bush-style tax cuts ó are so destructive.

So what should Mr. Obama do? Count me among those who think that the president made a big mistake in his initial approach, that his attempts to transcend partisanship ended up empowering politicians who take their marching orders from Rush Limbaugh. What matters now, however, is what he does next.

Itís time for Mr. Obama to go on the offensive. Above all, he must not shy away from pointing out that those who stand in the way of his plan, in the name of a discredited economic philosophy, are putting the nationís future at risk. The American economy is on the edge of catastrophe, and much of the Republican Party is trying to push it over that edge.

(Emphasis supplied.) Speaking for me only

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    No Focus, No Message, Pure Pork (5.00 / 4) (#3)
    by kidneystones on Fri Feb 06, 2009 at 07:48:33 AM EST
    Two trillion is the minimum number required to get America moving in a new direction. The wheels aren't coming off the car because a Republican wind-bag is huffing and puffing. The wheels are coming off because the product was put together by the same cabal of special interest groups that 'finds a lot to admire' in the former Senate leader and other lobbyist/tax cheats at the center of the new administration.

    The NYT has an excellent piece on Japan's efforts to spend its way out of recession. America needs to break with the past by building new energy sources that work now, not just pie in the sky clean-coal plants nobody seems to believe actually exist. That means nuclear and it means lots of nuclear.

    The new administration has had months to walk back from the tax-cuts for 95% of Americans fiction and present Americans with substance, not quickly cobbled together pork. Were this bill as inspired as its proponents claim, critics could easily be silenced by simply pointing to benefits, rather than excising or defending earmarks, earmarks that should never have been included in the first place.

    Do it right, do it slow, and make sure that the necessary money is being committed to change America, not just fill the coffers of special interest groups. Two trillion, at least, is the number, and some of that has to be in the form of loans to home and car owners to go green.

    Special interest groups (5.00 / 1) (#18)
    by gyrfalcon on Fri Feb 06, 2009 at 10:21:18 AM EST
    Y'mean like women and people who work for a living and stuff like that?

    There are no "special interest groups" here.  There are different sectors of the economy, all of which are suffering.  Increased employment and spending by any and all of them makes the economy as a whole function.

    Boy, you love those GOP talking points.


    My favorite part (none / 0) (#20)
    by Socraticsilence on Fri Feb 06, 2009 at 10:47:54 AM EST
    How clean coal is a pipe dream (and it is to an extent) but Nuclear is not only the solution but not a special interest, I mean sure dollar for dollar nuclear power is by far the most expensive source of energy on the market, and sure none of the pebble-bed style reactors have ever been built to full-scale, and sure nuke plants would face worse NIMBY obstacles tahn housing Gitmo inmates on a guys front lawn, but hey its the solution.

    BUT (5.00 / 1) (#5)
    by Shainzona on Fri Feb 06, 2009 at 08:22:24 AM EST
    the plan that everyone wants to rush through is NOT the answer...so in that context, really, the rush should be to get a plan that has a chance to actually do something, not just make Obama feel good.

    This is a very serious problem and it's no time to squander the opportunity to do it right.

    Krugman is probably correct (5.00 / 4) (#6)
    by coast on Fri Feb 06, 2009 at 08:26:04 AM EST
    that the stimulus bill needs to be larger, but maybe if the spending and tax cuts were actually directed properly an almost trillion dollar bill could do it.

    This bill is full of cr&*, and that's why its been losing support ever since the debate on it began.  There is not enough money going to infrastructure, and what is going to it appears it will be six months to a year before it can be pushed into the economy.  More money should go to unemployment benefits and food stamps...things that actually help people who have been hurt by this economy.

    The tax cuts are laughable.  I'm not sure what budget office geek calculated that the tax cuts amount to approx. $300 billion, but the details don't agree with reality.  The most "immediate" tax break that indivudals will see is a whopping $10 to $20 increase in their weekly pay check.  Wow!  One of the major business tax cuts is to allow companies to expense the cost of certain purchases of equipment, furniture and fixtures.  This worked well when is was done several years ago and usually does help businesses out.  However, it only works if the companies have the cash to purchase the assets.  They don't and they can't get any because they can't get loans and they can't get capital from the markets.  So the tax cut is essentially worthless.

    I don't like being told to make a rush decision about anything.  We needed to rush to war because we might get attacked....right.  We need to pass not one but several housing bills to save the homeowners from foreclosure...don't think that one is working out too well.  We need TARP to pass so we can get all this bad debt off the bank's balance sheet....I don't think the money was used for that.  And now we need to pass a spending bill that was suppose to create approx 4 million...oh wait maybe 3 million...oh wait we're not really sure how many jobs this will create but we just have to pass somehting for the sake of passing something...please!

    Yes something needs to be done, but it need to be done with some direction and intelligence.

    And that ain't all (5.00 / 2) (#12)
    by cal1942 on Fri Feb 06, 2009 at 09:10:03 AM EST
    One of the major business tax cuts is to allow companies to expense the cost of certain purchases of equipment, furniture and fixtures.  This worked well when is was done several years ago and usually does help businesses out.  However, it only works if the companies have the cash to purchase the assets.

    And purchasing various assets not directly related to R&D won't happen without increased demand even if loans were cheap and readily available.


    Don't you think this should be easy? (none / 0) (#1)
    by ThatOneVoter on Fri Feb 06, 2009 at 07:23:31 AM EST
    When have the Republicans been so discredited?
    Not since 1932?

    Trouble is (5.00 / 1) (#7)
    by cal1942 on Fri Feb 06, 2009 at 08:28:06 AM EST
    ThatOne is that this batch of Republicans aren't being discredited.

    The media seems to have adopted some of their line and insists that the GOP be allowed to muck up the works.  They want everyhing, the nation itself if need be, to be sacrificed on the altar of bi-partisanship.

    Even our very own Democratic President thinks having a bi-partisan cabinet is more important than having the legislative power to enact`his own recovery program. After all that bi-partisan thing was a major part of his campaign.  We can abandon the campaign now can we.


    The tax cut myth is powerful. (5.00 / 1) (#10)
    by ThatOneVoter on Fri Feb 06, 2009 at 08:59:59 AM EST
    Yes (5.00 / 1) (#13)
    by cal1942 on Fri Feb 06, 2009 at 09:16:55 AM EST
    it certainly is a powerful myth.  The whole conservative ideology is based on myth, fantasy and wishful thinking. Unfortunately our dear leader thinks that's a wellspring of good ideas.

    Tax cuts are like leeches--- (none / 0) (#14)
    by ThatOneVoter on Fri Feb 06, 2009 at 09:31:40 AM EST
    all purpose snake oil.

    So are deficits (1.00 / 2) (#17)
    by Slado on Fri Feb 06, 2009 at 10:13:30 AM EST
    and liberals are all too eager to apply them.

    Slado (none / 0) (#28)
    by cal1942 on Fri Feb 06, 2009 at 11:42:04 PM EST
    apparently you've chosen to forget the Republican tax cuts that led to deficits.



    We've been Bushed (none / 0) (#2)
    by NMvoiceofreason on Fri Feb 06, 2009 at 07:39:53 AM EST
    Bush SEC Holdovers Cite Executive Privilege, Refuse to Answer Questions at Madoff Hearing

    No, it isn't going to be easy. Scrub. Rinse. Repeat. (per Rachel Madow).

    We can't even get answers from the NEW administration. What makes you think the Republicans are discredited? Seems to me their Delay, Deny, Defraud campaign is in full swing.

    Losing two elections (none / 0) (#4)
    by Big Tent Democrat on Fri Feb 06, 2009 at 07:55:25 AM EST
    by significant margins generally qualifies as politically discredited if the actual results of GOP policies do not convince you that they have been discredited on policy.

    Problem is it wasn't GOP pricnciples (none / 0) (#8)
    by Slado on Fri Feb 06, 2009 at 08:48:51 AM EST
    that got us in this mess.

    It was deficit spending (war, Medicare prescription drug, NCLB etc..) that got us in this mess along with demcorats and republicans wanting people who can't afford homes to borrow money.

    Also the problem that with the theory that this is a GOP policy problem is the rest of the world has the same one and their problems where created by progressive governments.

    So what to do?  How about this?

    You are righ that 1trillion in Pork spending isn't enough.  Neither will 2trillion or 3trillion if it's constructed in the way democrats are constructing this plan.


    Absurd (5.00 / 4) (#9)
    by Big Tent Democrat on Fri Feb 06, 2009 at 08:55:53 AM EST
    Oh (5.00 / 6) (#11)
    by Steve M on Fri Feb 06, 2009 at 09:02:17 AM EST
    Somehow when the GOP controlled every branch of government, the things they did aren't to be considered GOP principles!  They actually ruled according to Democratic principles.  Gee, tell me another story.

    Not a story but reality (1.00 / 1) (#15)
    by Slado on Fri Feb 06, 2009 at 10:10:55 AM EST
    The rush to assign partisan blame and label this a GOP economy won't serve any of us.

    This was failure of governance based on an ideology that borrowing money in good times had no limits.  This was a bipartisan problem.

    The GOP is to blame because they went against thier true priciples and instead spent like a shopoholic at Macy's.  Democrats where no help either because they consistantly criticized not that the president spent too much but that he didn't spend enough.  However to their credit they pointed complained about the amount of money we where spending abroad while cutting taxes at home.  The dirty secret is they where really just mad it wasn't going to liberal policies instead of conservative ones.

    You can shoot the messenger but we are in debt.  Blame who you want be we are in tremendous debt and we cannot borrow and print our way out of it because this is a global crisis and nobody has any money.


    By the way the GOP (1.00 / 1) (#16)
    by Slado on Fri Feb 06, 2009 at 10:12:25 AM EST
    Didn't control every branch of government in 2006 and we are still in this mess.

    Patisan blame is just a waste of time.


    Sorry (5.00 / 3) (#19)
    by Steve M on Fri Feb 06, 2009 at 10:25:37 AM EST
    We got the massive deficit from two GOP tax cuts and Bush's trillion-dollar war.  You're not going to rewrite that chapter of the history book.

    So let me get this staright. (none / 0) (#21)
    by Slado on Fri Feb 06, 2009 at 10:58:31 AM EST
    GOP screwed up and ran up huge deficits?  (who cares you partisan opinion on why a fact is a fact) Agreed.

    So the answer is to run up larger deficits with a liberal spending agenda?

    Who cares how you get there?  Cutting taxes or spending more the result is the same.  We are in debt up to our ears and Obama/Congresses plan is to pile on and not even spend most of the borrowed money for 2 or 3 years.

    Perfect plan.


    cutting taxes (5.00 / 1) (#22)
    by CST on Fri Feb 06, 2009 at 11:10:30 AM EST
    is not the same as spending more.  Because when you spend more, the money can actually go somewhere usefull to help out the middle and lower classes who keep the economy running.  As opposed to giving it to the fat cats who put the money in the bank and sit on it while the banks write bad loans...  P.s. there is no such thing as "job creation" due to rich people getting tax cuts.  You don't create jobs out of thin air, you have to have a product to sell that people can buy.  Padding the wallets of people with tons of money doesn't do this in any way shape or form.  It's not like they weren't already spending the money they wanted to spend.

    Spending money on bombs that blow up is also vastly different from spending money to build roads that put people to work.

    It is not equivalent at all.

    Also, the economic crash is due to the housing bubble, not the gov't deficit.  If it was due to the deficit, we'd be facing inflation right now b/c our money would be worthless.  That's not what's happening.


    Exaclty (none / 0) (#24)
    by Socraticsilence on Fri Feb 06, 2009 at 11:32:20 AM EST
    Comparing that massive money-pit that is Iraq to say the interstate Highway system should show the difference- this is not to say that War should always be voted down due to cost, heck WW2 for instance was a great economic boom, but since Iraq basically spend factors of 10 more in country than on American Industrial production (ie were not employing millions to build tanks, planes, and liberty ships) we'd probably be better off if we just outright burned Iraqi reconstruction funds for heat.

    yes slado, the GOP (none / 0) (#23)
    by cpinva on Fri Feb 06, 2009 at 11:23:47 AM EST
    screwed up and ran up deficits, of huge magnitude, every year since bush took office. period, end of discussion, because there's nothing to discuss, the numbers tell the tale.

    unless, of course, you contend that every member of the CBO is a partisan liar, bent on making bush and the republican controlled (until jan. 2007) congress look bad?

    the fact (and it is a proven, historical fact) is, GOP policies and actions have nearly destroyed our economy, and nearly taken the rest of the world's economies down with it, it didn't happen in a vacuum. to argue otherwise merely diplays your complete detachment from reality.

    tell ya what, i'll take the analysis and recommendations of a nobel prize winning economist (paul krugman), over either you or coast. i just feel like he might have a clue what he's talking about, and neither of you do.

    cpinva (none / 0) (#25)
    by coast on Fri Feb 06, 2009 at 12:41:19 PM EST
    I don't know how I ruffled your feathers so much, but I agreed with krugman that this isn't enough.

    If you feel the need to get angry then you aren't (none / 0) (#26)
    by Slado on Fri Feb 06, 2009 at 04:01:51 PM EST
    understanding my point.

    The GOP wasn't acting like the GOP.  That's why they aren't in office.  They where spending too much money just like the democrats are now planning to do.

    No one has articulated how it makes a differenc which party is the one running up deficits.  My arguemnt is more deficits isn't the answer to the current one.

    I'll see your Nobel Prize winning economist and raise you another.


    I believe you in the lawyering (none / 0) (#27)
    by Slado on Fri Feb 06, 2009 at 04:06:13 PM EST
    profession call this a "battle of experts".

    There are two economic theories at play in this issue.  Keynesian vs. Freidman/Austrian

    one is right and one is wrong.

    We'll see