Comments on: How the Stimulus Bill Will Play Out in the Economy http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/ Firedoglake weblog Fri, 17 Feb 2012 22:10:27 -0600 hourly 1 http://wordpress.org/?v=3.1.2 By: pluege http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795644 pluege Sun, 18 Jan 2009 14:43:13 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795644 <p>3/4 for roads and 1/4 for trains encapsulates how the new approach is the same as the old approach - it should be exactly the opposite if anyone was serious about change. But the realty is that this is just more of the same old pigs slopping at the public trough - America just keeps on digging that hole under the “leadership” of Mr. Change.</p> 3/4 for roads and 1/4 for trains encapsulates how the new approach is the same as the old approach – it should be exactly the opposite if anyone was serious about change. But the realty is that this is just more of the same old pigs slopping at the public trough – America just keeps on digging that hole under the “leadership” of Mr. Change.

]]> By: T-Bear http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795546 T-Bear Sun, 18 Jan 2009 10:07:15 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795546 <p>Illuminating post Ian, in the fullness of time, methinks you will be vindicated in your observations. h/t to SanderO’s comments, well constructed, and delivered, clear, concise, well directed, and above all, helpful. </p> <p>As observed in other postings, the best that the current ideology can produce is about 50% return on bailout investment. This will prove to be inadequate and result in a Japan-like extended miasma of economic doldrums and do nothing to address the underlying causes.</p> <p>A much higher “return” on investment is needed to recover the economy. The only economic institution that has historically obtained such a return is that of capital, although ill-gotten in most cases in the hands of private enterprises. What has not been considered is the economic construction of “state capitalism” that controls the economic means of production at the national level for public good. We have experienced this in a modified form in the TVA, in the Bell Telephone before the pseudo-breakup of that monopoly, and several other examples. This “state capitalism” must have strict limitations, primarily that no corporation having less than 5% of the national market can be subjected to such controls. Those successful corporations having greater than 5% should automatically become subjected. This alone assures the breakup of economic oligarchy that owns and controls (or abuses their economic might). Only when the might of economic production is placed at public good, can the abuses be curtailed, and not a moment before then. This will provide the only tool with enough economic return to have any substantial effect on the current condition.</p> <p>Government too must revisit and reconsider their position vis a vis the balance between corporate economic power and the position of Labour. The prime requisite is the provision of a level “playing field” between, and when that cannot be provided, an obligation to weigh in in behalf of the weaker party which historically has been Labour.</p> <p>A mistake will be made in reducing the value of personally held property (mostly homes) in finding an adjustment to the present distortions. The loss must not be transfered to private property for public economic miss-direction or corporate malfeasance and theft. The source of the economic dislocation is in the return Labour receives from participating in the economic process, a dislocation that ensues with rampant, berserker, unrestrained private capitalism. By addressing the return for Labour as part of their economic participation, you avoid robbing the wealth value people have invested their lives in obtaining. That robbery of their “wealth” is utterly cruel and totally unnecessary should the real problem be addressed. </p> <p>It would be effort well spent to revisit and reconsider what definitions of the words we use to communicate complex ideas with, some are indefensible.</p> Illuminating post Ian, in the fullness of time, methinks you will be vindicated in your observations. h/t to SanderO’s comments, well constructed, and delivered, clear, concise, well directed, and above all, helpful.

As observed in other postings, the best that the current ideology can produce is about 50% return on bailout investment. This will prove to be inadequate and result in a Japan-like extended miasma of economic doldrums and do nothing to address the underlying causes.

A much higher “return” on investment is needed to recover the economy. The only economic institution that has historically obtained such a return is that of capital, although ill-gotten in most cases in the hands of private enterprises. What has not been considered is the economic construction of “state capitalism” that controls the economic means of production at the national level for public good. We have experienced this in a modified form in the TVA, in the Bell Telephone before the pseudo-breakup of that monopoly, and several other examples. This “state capitalism” must have strict limitations, primarily that no corporation having less than 5% of the national market can be subjected to such controls. Those successful corporations having greater than 5% should automatically become subjected. This alone assures the breakup of economic oligarchy that owns and controls (or abuses their economic might). Only when the might of economic production is placed at public good, can the abuses be curtailed, and not a moment before then. This will provide the only tool with enough economic return to have any substantial effect on the current condition.

Government too must revisit and reconsider their position vis a vis the balance between corporate economic power and the position of Labour. The prime requisite is the provision of a level “playing field” between, and when that cannot be provided, an obligation to weigh in in behalf of the weaker party which historically has been Labour.

A mistake will be made in reducing the value of personally held property (mostly homes) in finding an adjustment to the present distortions. The loss must not be transfered to private property for public economic miss-direction or corporate malfeasance and theft. The source of the economic dislocation is in the return Labour receives from participating in the economic process, a dislocation that ensues with rampant, berserker, unrestrained private capitalism. By addressing the return for Labour as part of their economic participation, you avoid robbing the wealth value people have invested their lives in obtaining. That robbery of their “wealth” is utterly cruel and totally unnecessary should the real problem be addressed.

It would be effort well spent to revisit and reconsider what definitions of the words we use to communicate complex ideas with, some are indefensible.

]]> By: Hugh http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795308 Hugh Sun, 18 Jan 2009 03:58:18 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795308 <blockquote><p>What makes you think this will stop the technical recession?</p></blockquote> <p>This is also my concern. I have yet to go through the whole plan but from the rough outline of its size and its split between tax cuts and spending, I think at best it may keep us just on the edges of depression. </p> <p>First, when the NBER finally got around to declaring the beginning of the recession at December 2007 its prime criterion seemed to be when employment started to tank. So I’m not sure that weak employment is going to convince the NBER that we have left a recession.</p> <p>Second, I’m not sure that the overall size of the stimulus is sufficient to create real growth in the GDP. Along with this if the stimulus is increased in size but remains poorly structured, it will worsen significantly our debt situation without really helping us that much.</p> <p>Third, the effects of the stimulus will last only about as long as the stimulus itself so if we are not using the stimulus as a transition to something else then we are looking at a double dip recession.</p> <p>Fourth, there seems precious little in all this to address the underlying problems which led to the housing crisis and financial meltdown. </p> <p>It is important to remember that the housing bubble burst with a bang in August 2007. We have been dinking with this for 18 months already. The Treasury has spent hundreds of billions and the Fed trillions with almost nothing to show for their efforts. Our budget deficit for 2009 is $1.2 trillion and could be $1.7-$2 trillion by the time all is said and done. Put simply we have already wasted enough time and money. I don’t think that we are going to have the resources for yet another “do-over” next year. </p> <p>This is why I am pessimistic. Obama is starting 18 months behind the curve and his solutions don’t address effectively what led up to this crisis, where we are now, and where we need to go. To me, this looks like he’s already three strikes and out before he even begins.</p>

What makes you think this will stop the technical recession?

This is also my concern. I have yet to go through the whole plan but from the rough outline of its size and its split between tax cuts and spending, I think at best it may keep us just on the edges of depression.

First, when the NBER finally got around to declaring the beginning of the recession at December 2007 its prime criterion seemed to be when employment started to tank. So I’m not sure that weak employment is going to convince the NBER that we have left a recession.

Second, I’m not sure that the overall size of the stimulus is sufficient to create real growth in the GDP. Along with this if the stimulus is increased in size but remains poorly structured, it will worsen significantly our debt situation without really helping us that much.

Third, the effects of the stimulus will last only about as long as the stimulus itself so if we are not using the stimulus as a transition to something else then we are looking at a double dip recession.

Fourth, there seems precious little in all this to address the underlying problems which led to the housing crisis and financial meltdown.

It is important to remember that the housing bubble burst with a bang in August 2007. We have been dinking with this for 18 months already. The Treasury has spent hundreds of billions and the Fed trillions with almost nothing to show for their efforts. Our budget deficit for 2009 is $1.2 trillion and could be $1.7-$2 trillion by the time all is said and done. Put simply we have already wasted enough time and money. I don’t think that we are going to have the resources for yet another “do-over” next year.

This is why I am pessimistic. Obama is starting 18 months behind the curve and his solutions don’t address effectively what led up to this crisis, where we are now, and where we need to go. To me, this looks like he’s already three strikes and out before he even begins.

]]> By: nonplussed http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795304 nonplussed Sun, 18 Jan 2009 03:37:51 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795304 <p>The Republicans have demonstrated their intentions to obstruct every stimulus initiative to the maximum possible extent. Now it is clear that we must strictly hew to the line of financial austerity, haven’t you heard about the gigantic debts we’re facing. Damn that irresponsible Clinton Administration!</p> <p>With the <strike>Traitors</strike>Bluedogs joining the Republicans in making life hard, things that actually pass may be very different from what is now envisioned. The GOP Senators are already threatening to place a hold on Hilda Solis over Card Check and Right to Work gottcha questions. They’re worried she might represent one side of the Business-Labor equation to the exclusion of the other. We certainly wouldn’t want that to happen, would we? These fuckers have no sense of shame! If there really was a vengeful God, he would smite these assholes where they stand…</p> The Republicans have demonstrated their intentions to obstruct every stimulus initiative to the maximum possible extent. Now it is clear that we must strictly hew to the line of financial austerity, haven’t you heard about the gigantic debts we’re facing. Damn that irresponsible Clinton Administration!

With the TraitorsBluedogs joining the Republicans in making life hard, things that actually pass may be very different from what is now envisioned. The GOP Senators are already threatening to place a hold on Hilda Solis over Card Check and Right to Work gottcha questions. They’re worried she might represent one side of the Business-Labor equation to the exclusion of the other. We certainly wouldn’t want that to happen, would we? These fuckers have no sense of shame! If there really was a vengeful God, he would smite these assholes where they stand…

]]> By: bigbrother http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795300 bigbrother Sun, 18 Jan 2009 03:25:48 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795300 <p>Well Ian thank youy again for great information. Read the Full Plan (speed reading). It seems the present deapartments/program will parcel the funds out.<br /> WRDA seems to be 1/10 funded for what is needed for wastewater/water infrastructure.<br /> Thge safety net appears weak and inadequate. But over all it seems comprehensive and broad.<br /> The job link you posted by the consultants appear OK except job losse will eat up those gains.<br /> We need three times what we have “loaned” the bank in order to heat up the economy. They got at least $2 trillion over the last 17 months. Alot of the funding seems for existing programs. That lowers the net stimulus.<br /> We need about five trillion which would come back in taxes once jobs are created. The tax cuts for the “middle class” are a bit confusing. Yes they will have more disposable income but will they spend it? I doubt it.<br /> Great post and back up data. Thanks. I forwarded it to my local officials at the County who are short road funds like the state…it should help them and the school districts.</p> Well Ian thank youy again for great information. Read the Full Plan (speed reading). It seems the present deapartments/program will parcel the funds out.
WRDA seems to be 1/10 funded for what is needed for wastewater/water infrastructure.
Thge safety net appears weak and inadequate. But over all it seems comprehensive and broad.
The job link you posted by the consultants appear OK except job losse will eat up those gains.
We need three times what we have “loaned” the bank in order to heat up the economy. They got at least $2 trillion over the last 17 months. Alot of the funding seems for existing programs. That lowers the net stimulus.
We need about five trillion which would come back in taxes once jobs are created. The tax cuts for the “middle class” are a bit confusing. Yes they will have more disposable income but will they spend it? I doubt it.
Great post and back up data. Thanks. I forwarded it to my local officials at the County who are short road funds like the state…it should help them and the school districts.

]]> By: SanderO http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795262 SanderO Sun, 18 Jan 2009 02:12:23 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795262 <p>“Bernanke and Obama offer solutions. But their plans to save the world from a correction are little more than a swindle. They offer to bail out the mistakes of one generation with trillions of dollars’ worth of debt laid onto the next.”</p> “Bernanke and Obama offer solutions. But their plans to save the world from a correction are little more than a swindle. They offer to bail out the mistakes of one generation with trillions of dollars’ worth of debt laid onto the next.”

]]> By: SanderO http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795261 SanderO Sun, 18 Jan 2009 02:10:54 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795261 <p>“…And each solution – and readers may substitute the word “bailout” for solution – brings more challenges and takes more resources. Finally, the available resources are worn out. Tainter observes that when the costs become high enough, people seem to give up. By the end of Roman era, for example, the burdens of empire were so heavy that people sold themselves into slavery to get free of them. So many people did so at one point that the authorities had to come up with another solution; they outlawed the practice. Henceforth, Roman citizens were required by law to remain free!”</p> “…And each solution – and readers may substitute the word “bailout” for solution – brings more challenges and takes more resources. Finally, the available resources are worn out. Tainter observes that when the costs become high enough, people seem to give up. By the end of Roman era, for example, the burdens of empire were so heavy that people sold themselves into slavery to get free of them. So many people did so at one point that the authorities had to come up with another solution; they outlawed the practice. Henceforth, Roman citizens were required by law to remain free!”

]]> By: SanderO http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795258 SanderO Sun, 18 Jan 2009 02:07:44 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795258 <p>“…Home prices will need to come down, probably at least another 50%, to get back to trendline levels and for home purchases to be attractive and affordable. The flipside of that, of course, is that that kind of plunging values will put tens of millions of Americans, British, Irish, Dutch, Spanish etc. etc. citizens a mile and a half below sea level on their mortgages. That is, opting to let real estate prices come down, which they must anyway, will mean a prolonged and painful period of bottom scraping. Going the other way, trying to keep home prices high, means that no-one can afford to buy a house. Except when they go into levels of debt that will bankrupt them down the line.</p> <p>So on the one hand prices need to plummet to make homes affordable, but on the other this will raise debt levels through the ceiling and beyond. Meanwhile, it doesn’t help that governments refuse to help their citizens, but instead elect to put them deeper into debt by handing their money to banks, a move that doesn’t just not aid the public, but is utterly contradictory to the public’s best interest. What we see coming out of parliaments, government cabinets and presidential residences today doesn’t just not solve anything, it makes it all much worse.”</p> “…Home prices will need to come down, probably at least another 50%, to get back to trendline levels and for home purchases to be attractive and affordable. The flipside of that, of course, is that that kind of plunging values will put tens of millions of Americans, British, Irish, Dutch, Spanish etc. etc. citizens a mile and a half below sea level on their mortgages. That is, opting to let real estate prices come down, which they must anyway, will mean a prolonged and painful period of bottom scraping. Going the other way, trying to keep home prices high, means that no-one can afford to buy a house. Except when they go into levels of debt that will bankrupt them down the line.

So on the one hand prices need to plummet to make homes affordable, but on the other this will raise debt levels through the ceiling and beyond. Meanwhile, it doesn’t help that governments refuse to help their citizens, but instead elect to put them deeper into debt by handing their money to banks, a move that doesn’t just not aid the public, but is utterly contradictory to the public’s best interest. What we see coming out of parliaments, government cabinets and presidential residences today doesn’t just not solve anything, it makes it all much worse.”

]]> By: SanderO http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795255 SanderO Sun, 18 Jan 2009 02:06:31 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795255 <p>This is the site to get the dope on the economy:</p> <p><a href="http://theautomaticearth.blogspot.com/" rel="nofollow">http://theautomaticearth.blogspot.com/</a></p> This is the site to get the dope on the economy:

http://theautomaticearth.blogspot.com/

]]> By: Margot http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795252 Margot Sun, 18 Jan 2009 02:03:46 +0000 http://firedoglake.com/2009/01/17/how-the-stimulus-bill-will-play-out-in-the-economy/#comment-1795252 <p>new <a href="http://firedoglake.com/2009/01/17/obamas-inaugural-guests-hate-and-hope/" rel="nofollow">post</a>—-></p> new post—->

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