Obamatrons: He has no idea what to do

[Anonymous]

"In response, Japanese policymakers tried a series of government economic stimulus programs and bank bailouts. A 2.4% budget surplus in 1991 turned to a deficit of 4.3% by 1996 and 10% by 1998, with the national debt to GDP ratio reaching 100%. In 1998, a $500 billion bank rescue plan was implemented to encourage bank lending and borrowing."

Not Republican policy to me.

I'm curious, after a decade of consolidated Republican rule under GW Bush, where the US went from historic surpluses to the current massive deficits we're now facing...was your comment intended to be hilarious?

Intentionally hilarious, I mean.

[Anonymous]

Anonymous wrote:I disagree, I think he does has a plan, and probably a good one. Just that his plan is at odds with all the all the rookie congress member's who are playing chicken with the economy. He is going to try and hit it down the middle, but with the crazy faction of the R party, the middle is going to be pretty damn conservative. Even at the same time he's still painted as a liberal, which he is not ruling as.

His 1st two years he had the House and Senate under Democratic control. and he didn't do anything. Presidents do not "rule," as they are elected and, thankfully, have to stand for re-election every four years. I do realize that the Obamas like to think of themselves as America's Imperial couple and I am hopeful they will be thrown out of their imperial backsides in Nov. 2012.

[jsteele]

Anonymous wrote:
His 1st two years he had the House and Senate under Democratic control. and he didn't do anything. Presidents do not "rule," as they are elected and, thankfully, have to stand for re-election every four years. I do realize that the Obamas like to think of themselves as America's Imperial couple and I am hopeful they will be thrown out of their imperial backsides in Nov. 2012.

Oh, what short memories we have. Obama never had a filibuster-proof majority in the Senate. Republicans made unprecedented use of the filibuster. They blocked even routine votes. Despite this, Obama was able to pass a historic -- if flawed -- healthcare bill. He passed a finance industry reform bill. He passed the stimulus bill. Obama orchestrated the bailout of the auto industry -- saving millions of jobs. The financial industry bailout -- TARP -- was modified from the original Bush plan in significant ways that have benefited taxpayers.

During the campaign, Obama stated that if bin Laden were found to be in Pakistan, he would authorize an attack without notifying the Pakistanis. He was criticized by both McCain and Hillary Clinton. I bet al-Qaida wishes Obama hadn't won the election and, like you, probably wish Obama hadn't done anything.

I have a number of criticisms of Obama. But, it is simply wrong to say that he hasn't done anything.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I disagree, I think he does has a plan, and probably a good one. Just that his plan is at odds with all the all the rookie congress member's who are playing chicken with the economy. He is going to try and hit it down the middle, but with the crazy faction of the R party, the middle is going to be pretty damn conservative. Even at the same time he's still painted as a liberal, which he is not ruling as.

His 1st two years he had the House and Senate under Democratic control. and he didn't do anything. Presidents do not "rule," as they are elected and, thankfully, have to stand for re-election every four years. I do realize that the Obamas like to think of themselves as America's Imperial couple and I am hopeful they will be thrown out of their imperial backsides in Nov. 2012.

It's ironic to claim that he is a do-nothing president and then try to make him solely responsible for deciding the raises in the debt cap. If you want to know who has been doing nothing, look at the people running from their responsibility under the Constitution.

[Anonymous]

13:14, sorry, I meant "not ideal Republican policy" to me.

But Jeff's claim that the Japanese only started running deficits in the 2000s is simply not correct. The Japanese have pretty much been running a non-stop deficit since 1990 (granted we've done better at not artificially propping up zombie companies).

Growth was slightly less anemic for Japan in the 2000s but was it worth running up the debt from ~100% of GDP to ~200% of GDP?

[Anonymous]

Anonymous wrote:13:14, sorry, I meant "not ideal Republican policy" to me.

But Jeff's claim that the Japanese only started running deficits in the 2000s is simply not correct. The Japanese have pretty much been running a non-stop deficit since 1990 (granted we've done better at not artificially propping up zombie companies).

Growth was slightly less anemic for Japan in the 2000s but was it worth running up the debt from ~100% of GDP to ~200% of GDP?

I'm interested what you think about Bernanke's stuff on Japan from his Princeton days. This was generally considered the best postmortem on what went wrong by US economists from either end of the ideological spectrum (at least until we started our current grappling for short-term political advantage):

http://www.businessweek.com/news/2011-06-20/professor-bernanke-s-paralysis-warning-meets-fed-facing-same.html

My take on the current Republican recommendations is that it's classic "shock doctrine": use a crisis to try to implement long-standing goals, regardless of what the situation demands. The current deficit projections are a function of a) the recession; and b) growth in health care spending. Agree or disagree, the Administration argues (and the CBO scorers agreed) that the ACA addresses "b". A return to growth would address "a".

Radically slashing government spending in a time when the private sector is not spending is the best way to prolong the recession. But it's something a small ideological section of the GOP really cares about (i.e. "drowning the government in a bathtub").

Unfortunately, the realists in the GOP are interested in pork as the Dems, and while the vast majority of the GOP base really do want federal spending cut...they want it cut for dark-skinned urban parasites and welfare queens. But certainly not light-skinned rural parasites and ag-fare queens.

Which is of course why spending never ever goes down under Republican rule. You don't get any significant savings from cutting hot lunches to schoolchildren, or subsidies for earthquake research.

[Anonymous]

I used to support him until he continued to push NCLB and put Duncan in charge - a man with no teaching experience.

http://www2.ed.gov/news/staff/bios/duncan.html

I just love this:
As a student in Chicago, Duncan spent afternoons in his mother's tutoring program and also worked there during a year off from college. He credits this experience with shaping his understanding of the challenges of urban education.


Obama's no better than Bush.

[Anonymous]

Face it. everything went down since democrats took congress in 2006 and got hold of the budget. End of story. If Obama was smart he would act like he just can't stop the GOP and accept what they want. The Economy will be roaring by 2012 and he will be re-elected and get all the credit like Clinton did when he caved.

[Anonymous]

The smartest thing for the GOP to propose is to defund .....the dept of education, NIH, FDA,HHS, PBS, dept of energy, standards and tech, slash the IRS, treasury, EPA, foreign aid, civil servant retirements, ect.... roll all the money into social security and medicare to save them and defund the government workforce. Make it social security/medicare vs. goverment employees.

[Anonymous]

Anonymous wrote:Face it. everything went down since democrats took congress in 2006 and got hold of the budget. End of story. If Obama was smart he would act like he just can't stop the GOP and accept what they want. The Economy will be roaring by 2012 and he will be re-elected and get all the credit like Clinton did when he caved.

If things were going so well, how did the Democrats take Congress? Why didn't Bush do more with his GOP Congress? Oh yeah, he passed Medicare Part D without even trying to fund it.

Face the facts: we got into two wars and it took Bush 5 !@#$ years to figure out what to do. We had the worst job creation record since Herbert Hoover.

11:33, all the things you mention, add up to under $100 billion. Or are you planning to be one of those "get government out of my Medicare" types?

(If Gingrich couldn't get rid of those things in the mid 1990s, they are going nowhere. I love how you propose de-funding the FDA. I guess you think of The Jungle as socialist claptrap, eh?)

[Anonymous]

Anonymous wrote:

Anonymous wrote:13:14, sorry, I meant "not ideal Republican policy" to me.

But Jeff's claim that the Japanese only started running deficits in the 2000s is simply not correct. The Japanese have pretty much been running a non-stop deficit since 1990 (granted we've done better at not artificially propping up zombie companies).

Growth was slightly less anemic for Japan in the 2000s but was it worth running up the debt from ~100% of GDP to ~200% of GDP?

I'm interested what you think about Bernanke's stuff on Japan from his Princeton days. This was generally considered the best postmortem on what went wrong by US economists from either end of the ideological spectrum (at least until we started our current grappling for short-term political advantage):

http://www.businessweek.com/news/2011-06-20/professor-bernanke-s-paralysis-warning-meets-fed-facing-same.html

My take on the current Republican recommendations is that it's classic "shock doctrine": use a crisis to try to implement long-standing goals, regardless of what the situation demands. The current deficit projections are a function of a) the recession; and b) growth in health care spending. Agree or disagree, the Administration argues (and the CBO scorers agreed) that the ACA addresses "b". A return to growth would address "a".

Radically slashing government spending in a time when the private sector is not spending is the best way to prolong the recession. But it's something a small ideological section of the GOP really cares about (i.e. "drowning the government in a bathtub").

Unfortunately, the realists in the GOP are interested in pork as the Dems, and while the vast majority of the GOP base really do want federal spending cut...they want it cut for dark-skinned urban parasites and welfare queens. But certainly not light-skinned rural parasites and ag-fare queens.

Which is of course why spending never ever goes down under Republican rule. You don't get any significant savings from cutting hot lunches to schoolchildren, or subsidies for earthquake research.

On the other hand, I'd like to avoid the Japanese experience where public debt goes over 200% of GDP (especially since our domestic savings are puny).

The Democrats at least understand on some level that taxes need to be raised if we are to maintain our social welfare state in anything resembling its current form. I can see a mix of entitlement cuts to the most well-off, a reversion to Clinton-era tax rates, some further cuts in defense, and some trimming around the edges to civil government being reasonably proposed by the Democrats.

The GOP aren't serious, they are playing small ball when it comes to cutting stuff (look at 11:33 as an example). Even Paul Ryan is postponing the pain, keeping Medicare around in its current form for 10+ years and let's face it, those vouchers won't really start saving money for another 20 years after that as the current crop of late 50s/early 60s people (who'll get in under the current system) die off. And that's even assuming the vouchers don't themselves become a sacred cow whose cost goes up as fast as Medicare does.

If the scenario is that dire, then the shock treatment must be applied to Medicare, Social Security, and defense.

[jsteele]

Anonymous wrote:
But Jeff's claim that the Japanese only started running deficits in the 2000s is simply not correct. The Japanese have pretty much been running a non-stop deficit since 1990 (granted we've done better at not artificially propping up zombie companies).

That was not my claim. I said they only started "significant deficit spending" then. I didn't say there were no earlier deficits. The problem was that the Japanese continued a series of half-measures. Just enough to prevent disaster, but not enough to stimulate recovery. Obama's stimulus package was much the same. It prevented additional job losses, but really did not create many jobs. Cutting spending now will be anti-stimulative. It will lead to more job losses. More job losses will lead to a Republican victory in 2012. I can understand why Republicans want this to happen. I just don't understand Obama's willingness to go along.

[Anonymous]

I think what we've learned is that housing bubbles fark up your economy for decades.

By 1998 it does appear that the Japanese were getting serious about deficit spending. UE rose from 2% in the early 90s to maybe 4% in the late 90s to over 5% in the early 00s.

It went from 5.5% to a bit under 4% over the course of the 2000s, and spiked up to nearly 6% during the 2008 crisis.

I do think Jeff, you are being somewhat facile about additional deficit spending automatically leading to more jobs as it seems the deficits of the late 1990s took a few years to reduce unemployment.

At some point (maybe we aren't close to it, what with China's bigger than ours bubble, Russia/Japan with their drunk and/or geriatric population, and with Europe's Tea Party analogue busy defending 55 year old civil servant pensions), our foreign sources of capital will begin to give the finger to us -- either Japan will realize they need to fund their own mountain of debt, or China will realize they can focus on their own market and don't need to export to us so badly. Either that or their bubble will pop and they'll need the capital more at home.

Or, to put it another way, how long *can* we sustain deficits of 10% of GDP?

[jsteele]

Anonymous wrote:
I do think Jeff, you are being somewhat facile about additional deficit spending automatically leading to more jobs as it seems the deficits of the late 1990s took a few years to reduce unemployment.

Of course deficit spending does not automatically lead to more jobs. It depends on how the money is spent. I have made this analogy before, but I'll do it again. If you take out a loan to buy a car, in five years you have a five year old car. But, if you take out a loan and invest in a business, you have the opportunity to get a return on your investment, pay back your loan, and continue to profit. Republican deficit spending, and sadly too much Democratic deficit spending, has been used to finance wars. There is very little return on such investment except for those lucky few in the weapons and mercenary business. I favor massive investment in three areas: 1) infrastructure including roads, bridges, and water treatment; 2) high speed rail and commuter rail; and 3) green energy. This will employ people, removing them from the unemployment rolls and turning them into taxpayers, it will stimulate the businesses that supply the material and do the work -- increasing the tax base -- and it will further developments that actually benefit Americans.

[Anonymous]

jsteele wrote:

Anonymous wrote:
I do think Jeff, you are being somewhat facile about additional deficit spending automatically leading to more jobs as it seems the deficits of the late 1990s took a few years to reduce unemployment.

Of course deficit spending does not automatically lead to more jobs. It depends on how the money is spent. I have made this analogy before, but I'll do it again. If you take out a loan to buy a car, in five years you have a five year old car. But, if you take out a loan and invest in a business, you have the opportunity to get a return on your investment, pay back your loan, and continue to profit. Republican deficit spending, and sadly too much Democratic deficit spending, has been used to finance wars. There is very little return on such investment except for those lucky few in the weapons and mercenary business. I favor massive investment in three areas: 1) infrastructure including roads, bridges, and water treatment; 2) high speed rail and commuter rail; and 3) green energy. This will employ people, removing them from the unemployment rolls and turning them into taxpayers, it will stimulate the businesses that supply the material and do the work -- increasing the tax base -- and it will further developments that actually benefit Americans.

but high speed raid has to be continually funded for the rest of its existence, and if nobody is riding it becomes a budget killer. High speed rail would work from DC to Boston, but I don't think anywhere else in this country. Certainly not Tampa to Miami.