When President Obama announced plans for the American Recovery and Reinvestment Act of 2009 (aka: the stimulus package), I was in agreement. By taking a huge amount of gubb'ment money and using it for the purpose of rebuilding crumbling infrastructure, making investments in the future, and extending unemployment and healthcare benefits to those less fortunate, the Act would both save and create jobs, as well as provide a Band-Aid to possibly lessen the financial devastation of those out of work.
As details of the plan rolled out, I was less enthused. The original amount for providing infrastructure upgrades (aka: creating jobs) was far less than originally intended, since the Democrats on the Hill caved in and let the GOP load it up with pointless tax breaks. Ditto for the amount allocated for pre-K programs, also sharply reduced in the name of bipartisanship.
In the end, although a whopping 2/3 of the money allocated for the act ended up being for tax breaks and entitlements which don't create jobs even in the best scenario, I was still down. The remaining $275B would be spent to keep Americans working or put them back to work. Or so I thought.
Nearly a year later, unemployment has soared to 10.2%, with no reversal in sight. Much of the money that should be creating jobs has yet to be rewarded, tied up in the bureaucratic soup of DC politricks. I guess you could see this as a good thing: nobody wants taxpayer money (or more charges on our ChinaOne MasterCard™) to be blown on stuff that doesn't save or create jobs. Going over grant and contract applications with a fine toothed comb is essential to limiting fraud.
Or so I thought.
In recent weeks, stories have trickled out about how initial stimulus money has been spent, and how it's been attributed to jobs created on the gubb'ment watchdog site Recovery.org. And my friends, the early returns are not pretty. In fact, they're pretty infuriating, as you'll find if you read a compilation of reports that the local fishwrap, the Washington Examiner just culled together. Here's merely a smattering of what the report mentioned.
More than ten percent of the jobs the Obama administration has claimed were "created or saved" by the $787 billion stimulus package are doubtful or imaginary, according to reports compiled from eleven major newspapers and the Associated Press.Before anyone goes off on a tangent about this being some rightwing conspiracy, a majority of these accounts were reported by The Associated Press, which is about as close to a non biased news agency as you'll find. If you think this is all BS, just go read the report and google the stories themselves. Nothing's being made up here.
Based only on our analysis of stimulus media coverage in the last two weeks, The Examiner has documented exaggerated stimulus claims. The report, which will be updated as new revelations appear, currently reflects an exaggeration by the Obama administration of about 75,000 jobs, out of the 640,000 jobs supposedly "created or saved."
This reflects reports from The Wall Street Journal, The Boston Globe, the Sacramento Bee, The New York Times, USA Today, the Las Vegas Sun, the Detroit Free Press, the New York Post, the Milwaukee Journal-Sentinel, the Associated Press, the Chicago Tribune, and the Atlanta Journal-Constitution. It remains a work in progress because relatively few newspapers have scrutinized stimulus spending so far.
The Obama administration has claimed that the $787 billion economic stimulus package "saved or created" some 650,000 jobs. But almost as soon as the White House trotted out this figure, news organizations found huge exaggerations in the reported data. Many of the jobs reportedly created do not exist or cannot be accounted for.
The Southwest Georgia Community Action Council claimed to have saved 935 jobs with the $1.3 million it received, even though only 508 people work there. In fact, the group used most of its grant to give raises and now says it created 9.35 jobs.
“The Bergen County Community Action Program in Hackensack, N.J., noted the nearly $213,000 it received went to cover raises for existing staff only, but it also reported saving 85 jobs.”
The Child Care Association of Brevard County reported creating 129 jobs with $98,669 in stimulus money. In fact, “the cash was used to give her 129 employees a 3.9 percent cost-of-living raise.”
Koring Group in Toledo, Ohio reported hiring 52 people, but it turns out that they double-counted jobs that “only lasted about two months.” The FCC estimates that “actual job count is closer to five.”
The Mid-Willamette Valley (Oregon) Community Action Agency reported 205 jobs created or saved with $397,761. The money was actually used for pay raises.
A Kentucky shoe-store owner claimed he created nine jobs on an $889.60 contract. In fact, he supplied nine pairs of shoes to the Army Corps of Engineers.
Stetson University in DeLand, Fla claimed to have created or saved 483 jobs with a grant of only $193,469.
Officials at East Central Technical College in Douglas, Ga. “said they now know they shouldn't have claimed 280 stimulus jobs linked to more than $200,000 to buy trucks and trailers for commercial driving instruction...The 280 were not jobs, but the number of students who would benefit...”
In DC, $3,500 purchase of paint was credited with saving or creating a job.
The California State University system received $268.5 million in stimulus funds and claimed that the money allowed them to save over 26,000 jobs or half its workforce. But when pressed, the California State University system admitted they weren't really going to lay off half their workforce, and that in fact few or none of these jobs would have been lost without the stimulus. "This is not really a real number of people," a CSU spokesman said. "It's like a budget number."
Of the 34,500 jobs allegedly saved or created by the stimulus in Washington State, 24,000 belong to state teachers already under contract to finish out the school year, whose jobs were never in jeopardy. Rather, stimulus money was shuffled to them and their money went to offset budget cuts elsewhere.
In Arlington, VA $100,000 in stimulus money is being used to start a wine bar.
Two child care centers in central Colorado claimed to have created 292 jobs with $650,000 in grant money. In fact, the money went to pay raises.
The local Head Start program in Greenfield, Mass. claimed 90 new jobs, but actually created no new jobs, and used its $245,000 grant to give pay raises.
The company Teletech claimed to have created 4,300 jobs from a $28.4 million contract, but in fact 3,000 of the jobs lasted only a month.
Bridgewater State (CT) College claimed to have created 160 jobs with a $77,000 grant. The college acknowledged the mistake, and said no new jobs were created.
As I said earlier on, anytime you send this sort of money out the door, the possibility for fraud and waste is pretty much a given. People will game the system. But it's the gubb'ment's job to make sure that those who receive the money are on the up and up, and are being truthful about the money being spent and the jobs saved and/or created. There is simply no excuse for this sort of numeric trickery by states, counties, and cities wasting money to such a degree. Some reports on Recovery.gov have stimulus money going to Congressional districts that don't even exist. I should also note that the money being burned is spread evenly across the electoral map, so this ain't a partisan issue. Everyone's gaming the system, and it's a damn shame.
There are plenty of fingers to point here. The folks in DC needed to better scrutinize the grants and contracts they awarded. The state/local authorities needed to be more truthful. Recovery.gov shouldn't have reported job claims without substantiation. A gauge of true "jobs saved" is curiously absent.
But ultimately, the real culprit here is Obama himself. Sh*t rolls upstream, and ultimately the buck stops with the guy who introduced the idea in the first place. I suspect Republicans are being eerily silent on all this waste because their hands are also in the cookie jar, but the handful of Governors who refused stimulus funds last Spring are suddenly looking like geniuses, even if in each case they were overruled by their state's legislatures.
This is a textbook example of a great concept with piss-poor execution. And let the record reflect that I still support the President overall, but given the exaggerated job claims, the lack of accountability, and the billions in blown money that could have been better allocated (or simply not allocated at all), I have no choice but to label the American Recovery and Reinvestment Act of 2009 an Epic (and very Expensive) Fail.
Question: What do you think about this report? Did you originally support the stimulus package? What could have been done to ensure greater accountability and less fraud? How does the country reverse this freefall of lost jobs?
75,343 Bogus jobs 'created or saved' by the Stimulus [Washington Examiner]
Stimulus saves jobs in nonexistent districts [Washington Examiner]
Stimulus Funding For A Wine Bar? [WUSA9]
StimulusWatch.org
Recovery.Gov
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I think the problem is/was too much money and not enough watchdogs. I think an entire bipartisan compliance group should have been keeping closer tabs on the money going out the door and monitoring how it got spent.
BUT, I don't agree that the entire stimulus has been an epic fail. I don't think we've seen all of the trickle down come to fruition because I think they underestimated just how bad off everything was to begin with.
Just my opinion, no researched facts behind them.
Deep, resounding sigh.
I agree with what Uppity's been saying for a while, though----what the heck happened to all the infracstructure restoration programs that were supposed to create jobs, New Deal-style? I was THRILLED during the campaign that mainstram politics was finally focusing on infrastructure renewal, and it was one of the things that got me on board with Obama. But now? No one talks about it. It's gone. Dead. My question is why? It should have been a huge part of all this.
most of the recovery act jobs i've spotted, were for those with education beyond the master's level. paying at $60to $130K a year. How is this helping the rest of us?
The country needs to get off the tax cut mantra. There are a lot of things that need to be done to reverse lost jobs and improve the tax base but most of them are not popular with the financial/political elites.
1) Break up banks and hedge funds that are too big to fail. Rebuild firewalls between banking and speculation.
2) Increase tarriffs on Chinese imports and change tax policy so that outsourcing is financially disadvantageous in most instances.
3) Either jawbone the Chinese into letting the yuan appreciate or start to do it for them.
Unless the outsourcing/offshoring and immigration is confronted and dealt with there is simply not going to be a recovery. Or at least not the kind of recovery we would want to see-one with rises in real wages and numerous jobs.
Instead of 4-5% being an acceptable unemployment number we may have to get used to 7-8% being full employment.
I did think the stimulus was too small especially considering the amount of money that was handed over to the banks. Politically now, it will be very difficult to get a second stimulus passed, which is exactly what people like Krugman and Reich were saying before the first one passed. At this point the politics the Democrats may just have to hope that things straighten out before November 2010. But the Republicans have no ideas other than tax cuts and deregulation, which not coincidentally is a big reason we're in this mess. There is a huge disconnect between GDP and job growth/wage growth. This is not a bad thing if you happen to be a business owner, for others, not so good. Both parties are responsible for this.
Obama made a mistake IMO trying to do health care before the economy.
Reading this Obama could have just not did military reform and they would have provided better results.
As someone who lives in Bergen County, I can tell you that any money coming here will be misallocated. The same goes for Hudson and Essex Counties. There have been incidinets where elected officials used school fundsto rent limosand order caviar. Officials in Lodi used town money to visit a "massage" parlor. Any money coming to NJ will be wasted. Philly and NYC suffer fromthe same issues, see Street,John and Kerik, Bernard.
We seem to have way too many conservatives or borderline moderates on both sides of the aisle to even begin the actual work of upgrading this place. Trying to allocate funds into certain pockets isn't called "recovery". Still trying to herd cats, I guess...
AB - Do you ever notice how "YOU" comes out in what you write?
[quote]since the Democrats on the Hill caved in and let the GOP load it up with pointless tax breaks. Ditto for the amount allocated for pre-K programs, also sharply reduced in the name of bipartisanship.[/quote]
Translation:
DESPITE the fact that the party that I left because it failed to defend Obama over racial attacks from the Republicans is in total control over the House and the Senate.....passing the stimulus bill with only a few GOP votes.....ONE OF WHOM later switched to the Democratic Party.....It is the REPUBLICANS who forced the good guy Democrats to destroy the bill by adding tax breaks.
Had the Democrats not been molested by the minority Republicans this bill would have contained all of the infrastructure spending that I was hoping for. In fact it would have contained so much spending that I would have REFUSED to allow them to build a new "Golden Gate Bridge" besides the original bridge just for the sake of creating jobs. Think about all of the environmental damage this would cause. Think about the need for a wide angle lens in the camera as visitors to SFO tried to snap the scene with two bridges.
WHY doesn't the abundance of evidence lead you to make an UNCONDITIONAL assessment AB?
You have worked long and hard for this day!
As a resident of Maryland THERE IS NOT ONE REPUBLICAN representative or majority legislative body in your way - LOCALLY, STATE-WIDE, NATIONALLY not one!!!
The same economic FAILURES that have precipitated the federal takeover by the Democrats are the very failures that triggered their brand of FIXES in the way of this stimulus bill. (Only in Baltimore "failure" doesn't lead to a party or ideological purge)
Why not a more clear "lessoned learned" from you: "THE NEXT TIME I see a massive flush of DEBT MONEY from Washington DC downward I AM GOING TO STAND OPPOSED TO IT AT THE FRONT END because the main two consequences will be MISALLOCATION and INCREASED DEBT".
Let me ask you - Being that the progressive "Color Of Change" when on the attack in South Carolina because they said the motivation for rejecting these funds was due to RACISM rather than fiscal concern - Do YOU believe that some apologies are due, now that you too are skeptical - after the fact?
The problem with having watchdogs is that the watchdogs are easy to corrupt also because they generally travel around the same circles. Or if you have these watchdogs in place you have to pay them so what percentage of the stimulus do you allocate to "Watchdog programs"
@shady
Adding tariffs to chinese imports seems like a good idea. But most of the products are American products manufactured in China. Companies don't want to be double taxed as they see it. And outsourcing/offshoring is just the way the global economy works. Until the consumers have the ability to use the global marketplace then you will continue to see this trend.
I wanted the entire amount for infrastructure.
I was willing to accept some waste and corruption in 3/4 of a trillion dollars in infrastructure upgrades but we could have rebuilt most of the highways and more than a few airports for 787B, from scratch.
Unfortunately, infrastructure isn't district-specific enough for politicos to proclaim they are bringing help to their constituents.
How many bridges, roads, airports, highway interchanges, new subway lines, etc. could have been built. DC could have a subway ring around the city with that money.
These comments are hilarious!
@OneChele: See link below for your compliance group. Question: are you suggesting that a few Republicans on that group, a little bipartisanship, might've made it better?
At least it would have spread the blame around some.
@Marbles:
Great Question! Remember "shovel-ready"? The only thing shovel ready around here is the pile of manure at recovery.gov.
@shady: adding tariffs would fling us into an even deeper depression. That's exactly what Hoover did to try and stave off disaster.
Secondly, how can you suggest that the stimulus was too small when much of it hasn't been spent and much of what WAS spent was wasted? That's comedy gold, man. I guess your solution is to dilute the waste, fraud, and abuse through even more cash floating around, in the hope that there's some upper boundary past which all dollars are helpful?
Riiiiight.
@ch555x:
You've got to be sh!tt!ng me, man. It's the conservatives' faults? COME ON! You have to see the ridiculousness of that statement.
@cjames:
It was the responsibility of the Obama Whitehouse to solve that problem. In fact, that was probably their most important job function with respect to the stimulus. The President even called out somebody by name who would be in charge of preventing EXACTLY this sort of fraud and abuse. Do you remember?
Click here to watch our President tell the nation: "Nobody messes with Joe".
A tough new oversight committee. What a bunch of BS! It's enough to make you join a Tea Party protest.
Waste, fraud, abuse, political payoffs, and back-loading the spending so it happens nearer the 2010 election rather than, err, nearer the problem. I think it's once again for my least favorite sentence, AB commenters:
I Told You So.
And this is the government you want to take over healthcare?
ROTFL!
Well here in NC, I have seen some of my stimulus money at work. However, I am not suprised that some of the money is used to rob peter to pay paul. It is the game. shoot Obama has so many plates in the air that I am not suprised. Not to mention there are a lot of folks that don't have his back. he needs to stop with the cronyism and hire some folks to work in that area that have an irs agents moxy. nuff said.
LMAO, IRS agent?!
That's the thing his staff fears most in the world!
I'm torn.
I don't know who to blame Obama or Congress.
I'm much more ready to blame Congress and various others on local levels in state houses and senates. When they got a hold of this money they didn't do with what "upper level management" said to do with it. As a result it comes off as bad parenting on behalf of Obama; a parent who gives their child a cup of grape juice but that child should still be drinking out of a sippy cup and makes a huge big mess. Is it the child's fault for spilling it, or is it the parents fault for not having enough foresight to know if said child was ready?
I still don't excuse the governors who wanted to reject the TARP funds on the basis that I'm not convinced that they jointly offered the proper solution to addressing the problem.
To echo what I've been saying, thanks @Marbles, if Obama had pressed this TARP money as a green initiative and/or infrastructure rebuilding a la The New Deal, it would have been a major success.
Infrastructure is something that we all benefit from, and above that, it's something that we call all see. Everyone uses highways and we can see what construction does. And speaking for Atlanta specifically, they're just now addressing the water main and sewer system with level of success now. When I got here in 2006, literally every other day there was some news of a water main break on these major intersections and everywhere you looked, there was the department of Water out fixing something. And the Mitchell street bridge has been closed since 2007 after the bridge collapse over the Mississippi River in Minneapolis--why haven't they fixed that.
It's a system problem.
We live and operate in a system that best works on trickle down economics. The lower your pay grade, the more dependent you are on random lucky breaks and the more you pray your hard work pays off. Otherwise you're solely dependent on those in a higher tax bracket to take of the money. That's all that we have here: people got ahold of the money and didn't do what they were supposed to do with it.
The stimulus plan was a doomed to be a epic fail from the premise that spending tax payers money to stimulate the economy is a bad idea.
Running up more debt to in order to roll the dice and hope that you may be able to stimulate the economy is a bad idea. Not to mentioned that a lot of this money has ended up not creating jobs but merely padding budgets to prevent layoffs. I like the president but I got to call the stimulus package for what it is "a dog that don't hunt".
@Spool,Wave
To quote Krugman you would think that adherents of a failed economic philosophy that has brought the US the worst recession since the Great Depression and one which should never even have occurred according to their models, would be just a little bit humbled and curious about Keynesian economic applications and other non Milton Friedman approved models. But nope.
Republicans in general and Conservatives in particular remain the party of economic ignorance.
I do argue that the stimulus was too small the same way I would argue that a gunshot victim brought into emergency needs a stronger drug than aspirin. Giving him an aspirin and then claiming that since he didn't get better we know that drugs don't help is ridiculous. That's the Republican position right now. It's beyond asinine.
And it is a myth that the Smoot-Hawley Act worsened the Great Depression. The facts say otherwise. What worsened the Great Depression was the same ideologically driven opposition to Keynesian solutions that we see now. Obama heeds those voices at all of our peril.
You would also need to show why China has been economically successful despite being one of the mostly highly protectionist nations on the planet.
@Cjames
Our economic structures are choices. We can change them. The current structure is not only unfair to billions, it's inherently unstable, as we are discovering now. China can not pursue a beggar thy neighbor monetary/trade policy that attempts to acquire the US entire manufacturing infrastructure, nor can US consumers drive the US or world economy forever. The outsourcing and resultant growing inequality of income must be slowed down and even halted. Chinese consumer demand needs to grow.
Tariff Myths
Working America
Obama's Trap
Republicans Don't Listen
AB: How dare you say anything that happens in Washington, with a black president and a Democrat controlled congress is anything but perfect? You are black arent you? Just checking.
Ok, that was uncalled for.
Palin did it.
Ok, that too was uncalled for.
This is one of the biggest clusters of all time. There are plenty of projects that could have been immediately funded (like bridges and such) that would have put people to work, helped out local economies all over the US and really helped out. Instead, we have waste, fraud and abuse and the rest of the cash doesnt even get spent until next year, an election year. Nice.I could do a 100 pages on why this mess occured and *some* of what it takes to fix it. Unfortunately it doesnt blame Bush, Cheny or Palin directly so its not worth explaining here but suffice to say, most of the regulation necessary to prevent it happening again has alraedy been done. The rest is up to the markets and that will take time.
Well. This is a for what it is worth comment. I'm not somebody who can make sweeping general statements about things especially not something like economics which I only know about from reading articles in various news magazines and papers and an Econ 101 class some 25 years ago. It isn't that I don't find it interesting. It is that so far I haven't managed to fit more than 24 hours in a day and 8 of those have to be spent sleeping. I have more than an academic interest in a job creating economic recovery. A little over a year ago, I set my compass and packed the car and headed out here partly due to the relatively low cost of living and partly because the unemployment rate was near the lowest in the country. It seemed like a good place to perch for a minute while launching phase III of the life plan. Then, the economy crashed. Oops. Sigh. No need to worry really since I'm like the 'little engine that could' and I'll find my way to greener pastures somehow. But in studying these articles I've read, I've come to the conclusion that neither party has the solution to the current economic situation and even economist can't agree. So from the practical perspective of 'what do I do?' I'm assuming things are not going to get better any time soon. I guess most of us set the basis for how we think of things in those formative pre-teen and teen years. During that time for me it was Ford, Carter, and then Reagan as president and there was the oil embargo and inflation. In our household, there was always a push for economy, food grown in the garden, canning of fruits and vegetables, and the practical recycling and conservation of keeping anything remotely useful like cardboard and string. Flash forward to 30 years on and it seems people don't live that way any more. I know it makes me sound like an old person, but I wonder whether part of the economic crisis is the result of a consumer appetite that is beyond our means. Just a thought.
@Snady:
You have your cause and effect backwards. China only became effective after 1989 when they began to open up trade and remove barriers. See also: Hong Kong.
Secondly, your stimulus analogy is, I'm sorry, idiotic. What you're suggesting is more like getting a fever, taking half an aspirin, and when that doesn't work demanding that you be taken to the hospital for blood transfusions and an ice bath. There is absolutely no logic whatsoever in suggesting that the government should pass a larger stimulus because the first stimulus failed, when the first stimulus hasn't been spent on stimulus! "We need more money spent, this hasn't worked!" Well, OK, spend the rest of the damned money then. Don't argue for a whole new round of spending bills.
Feel free to wave Krugman's name around if you like. Name checking one Keynsian does not a point create. Oversimplification is the devil of good arguments, and you've thoroughly bedeviled yours. Me, I'll put my money with the Chicago School, rather than an economist reduced to scribbling for the Grey Lady to get attention, even if he IS often a smart individual. After all, a busted clock is right twice a day eh?
Lastly: Even if I grant you that more stimulus is needed, and I don't... but even if I did, this administration has proven it cannot be trusted to actually stimulate the economy with what it has right now! Expecting a different result in round two is entirely unrealistic. Apparently, everybody messes with Joe. Obama's lack of judgment, comical mistakes in benchmarking the "recovery", ad slipshod enforcement of MY money has shattered his credibility on the issue. We're actually in WORSE shape if you're right, because your solution is now impossible to attempt. We just can't trust the President to get it right.
At least not until 2013.
Spool, I don't know how much economic theory you've taken but I'm betting it's not much. The Chicago School of economics simply did not predict and can not explain this recession, particularly when the policies of the past eight years have been largely dictated by the same Chicago school. Their monetary theory and efficient market theory have both been shown to be WRONG.
Tax cuts and low interest rates will not work when aggregate demand is shot and interest rates are close to zero already.
Gee, Nobel Prize winning economist or right wing ideologue...hmm whom should I study. If anything Krugman has been MORE supportive of Obama than his fellow Nobel Prize winner Joseph Stiglitz who has written at great length why the stimulus was too small. Have you read anything by either of those men? It sounds like you're just regurgitating talking points.
Talk about simplifying things..I never wrote that trade was bad or that China had a completely closed economy. The fact is that TODAY China is far more protectionist than the US. It takes a huge number of steps to protect Chinese economic interests, including but not limited to currency pegging, refusal to enforce intellectual property rights, tariffs, limitations on foreign ownership, capital transfer limits, and requirements that Chinese government or "private" companies have a large and sometimes controlling interest in companies
located on the Chinese mainland.
They are even doing an internal (Keynesian) stimulus package.
LOL
All of this is complete anathema to any disciple of Milton Friedman.
But it's working for the Chinese.
The conservative mantra of tax cuts, outsourcing and deregulation is BS. We tried that. It didn't work. It's dangerous to working people.
Friedman also won a Nobel, and the only people who are saying his model has been repudiated are the Keynsians (of course).
The "conservative mantra" doesn't mention outsourcing.
You're presenting this econ theory argument as settled canon, when in fact there is still robust academic debate and strong points to be made on both sides of the question. That's fundamentally dishonest. Again, assertions does not create truth.
You've completely skilled over every commonsense point I've made in favor of, and I can't believe I'm typing this, supporting the Chinese economic model. There are billions of Chinese people living in abject poverty while their authoritarian rulers get rich off the country's moves toward a more open economy. Are you seriously advocating tax increases, protectionism, and state control of business as the solution to our economic problems?
Seriously?
I despair of having any point I've made addressed in this thread...
Anyone with more brains than a polecat ferret would have known this was a farce from the beginning. The irony is that tax reductions actually *do* create jobs because workers who keep more of their money are inclined to actually spend it on goods and services. And that money isn't "from the government" - it's from other peoples' pockets. The American people are so stupid that they repeatedly promise to vote for politicians that promise to bribe them with their own, or their neighbor's money.
I'm old enough to remember the last time a major attempt was made to "save and create jobs" at the federal level. It was called CETA, the Comprehensive Education and Training Act; the intent of the act was to provide jobs for the unemployed and provide training to entry level workers so they could earn a decent wage. Many government and non-profit agencies didn't want or need entry level workers - but the money was manna from heaven and was used to fulfill the wish lists of a whole range of agencies and non-profits - many CETA jobs required advanced education or years in the field. I can remember going to CETA "job fairs" in the 1970s and finding few jobs for those with a Bachelor's degree degree - and only one or two for those with a high school diploma - and those were secretarial positions that required several years experience in the field. Most of the jobs required advanced degrees - and all this funded by a program that was supposed to hire the unemployed and train them in job skills. I was literally blown away by the number of positions that required PhDs; I went to the fair with a woman who held a Master's degree and out of dozens of offerings in her field, only a handful would accept less than a PhD.
In other words, out of hundreds of job positions funded by a program that was supposed to hire and train workers there was NOT ONE position offered that actually would hire and train a worker.
[quote] There is absolutely no logic whatsoever in suggesting that the government should pass a larger stimulus because the first stimulus failed, when the first stimulus hasn't been spent on stimulus![/quote]
Shady Grady:
You and Paul Krugman seek to make use of the Federal Government as a VENTURE CAPITALIST angel.
Just as during the Internet boom in this nation - where there were IPOs, Venture capitalists. Where Pension funds and many state treasuries dumped their enormous holdings into the stock market - THIS was the source of funds for new companies that were created that generated new jobs and funds for capital purchases & rents which drove up the GDP.
The key flaw with your theory is that when the GOVERNMENT is the venture capital source - sure you can stimulate the economy just as these sources listed above did per the traditional financial markets - but you also CREATE FEDERAL DEBT. This debt has to be purchased by investors as Treasury Bonds. These bonds have to be serviced each month via INTEREST PAYMENTS.
You and Krugman have your heads stuck in the sand from the New Deal/WWII era where the US was not ALREADY in debt and could afford to carry these amounts. Today we have a $13,000 billion debt which is on track to grow to $20,000 billion in 10 years. In due time the USA will pay more per year in INTEREST DEBT than it does on MILITARY spending.
It is clear that those who call for "Debt Spending Our Way Out Of This Recession" are more interested in retaining our Standard of Living without pain than they are able to see the PAIN that they is fomenting for the future.
If present debt spending created economic infrastructure that created far more economic prosperity than the DEBT that was left - then YES it is justified. IF I used my credit card purchase a drill and a lawn mower for my business - I could justify such debt upon which I will make future profits.
Too much of this money today is being spent on maintenance of a standard of living within all layers of government that is no longer sustainable by the present economic activity.
http://www.iousathemovie.com/
@Spool, do you think that Alan Greenspan is a Keynesian?
You know Alan Greenspan, the Ayn Rand/Milton Friedman devotee.
Why would he, in discussing CAPM and efficient markets hypothesis and self-regulation, admit before Congress that the entire "intellectual edifice collapsed" and that he was in a "state of shocked disbelief".
So if a person as far to the Right as Greenspan can admit that he got some things wrong, that says a lot about his honesty. I can respect that. But unfortunately many ideologues on the Right do not share his ability to accept reality.
Milton Friedman's devotees like Fama and Prescott (among others) got it wrong. Their advice proved ruinous to the economy.
You talk about commonsense points but frankly you haven't made any. All you've done is repeat dogma and ignore evidence. If it turns out that Smoot-Hawley didn't worsen the Great Depression, you ignore that fact and move on to some other claim. That's dishonest.
Did you see me write that the US should become like China. No. What the free market devotees must do is explain why they want the US market to be open to the world while the world (China) puts up numerous barriers to the US. According to free market models China should not be as successful as it is.
However the current model where the US consumes and borrows and offshores manufacturing while China produces and saves and builds things is not good for the US nor is it sustainable.
@CF
As usual, you DON'T KNOW WHAT you are talking about.
If consumer and business demand is declining or non-existent, government is the ONLY actor big enough to step in and make a difference until the other groups' demand grows again. The FED has NO bullets left in the chamber.
http://www.newdeal20.org/?p=4633
At WW2's end debt was OVER 100% of GDP.
In 1950 Debt was 80% of GDP.
The 10 yr projection has the US reaching a HIGH of 70% around 2019.
There is NO real comparison between an individual debtor and the FEDERAL government. That's SILLY.
i'm not big on protectionism because i think it's a sort of going-against-the-tide type of thing, but interesting comments made by all.
To comment on the taxation issue, let's at least point out that tax cuts are still a form of deficit spending. The same principles that apply to government spending applies to tax cuts (holes don't get dug for free, money is transferred to the people either way) It just happens to be the least effective form of stimulus.
As for the current stimulus as a whole. I'm inclined to say it was too small. Really all it's done so far is give Obama a gdp number to tote around in the fall and maybe a percentage point off unemployment. Things will probably hum by the end of 2010, but the only reason for it happenining that late is politics.
"You've got to be sh!tt!ng me, man. It's the conservatives' faults? COME ON! You have to see the ridiculousness of that statement."-spool32
My definitions of mods and cons may differ, but yeah I'll toss some blame their way. They picked a fine time trying to "moderate" and "conserve" them funds while the place looks to be caving in. They didn't see problems handing out tax cuts, but all of sudden want to blast stimulus...LMAO!!!
[quote]As usual, you DON'T KNOW WHAT you are talking about.[/quote]
Indeed you are correct Shady Grady.
I would magically gain 50 points on my I.Q. IF I simply started agreeing with you.
You keep comparing DEBT PERCENTAGES while failing to make note of the forth coming impact of the confluence of:
* Debt
* Existing Entitlement Spending
* NEW Entitlement Spending
and
* The Economically Suppressive effect of the higher taxes that will no doubt be exacted upon the nation.
Hey I just happened to make a post on the subject:
http://withintheblackcommunity.blogspot.com/2009/11/federal-governments-credit-card-cash.html
[quote]They didn't see problems handing out tax cuts, but all of sudden want to blast stimulus...LMAO!!![/quote]
ch555x:
Can you articulate how one "Hands Out Tax Cuts"?
It thought that it was "Allowing people to KEEP THEIR OWN DAMNED MONEY in a manner that was beneath the revenue requirements to match GOVERNMENT SPENDING"???
The problem was not the "tax cuts" but the fact that the necessary SPENDING CUTS were not mandated in kind.
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