The administration has stopped short of calling for a second economic stimulus package to augment the $787 billion measure approved this year. But with the jobless rate continuing to climb, President Barack Obama said Saturday he is exploring “additional options to promote job creation.”
In his weekly radio and Internet video address Saturday, Obama said his proposed health care overhaul would create jobs by making small business startups more affordable. If aspiring entrepreneurs believe they can stay insured while switching jobs, he said, they will start new businesses and hire workers.
It is amazing that people still believe Obama and the government in general after this. They haven’t managed to create any jobs and blame it on lack of government involvement.
#61
> Consistency is
> the hobgoblin
> of small minds!
Indeed. You are, if nothing else, consistent. Perhaps you should re-read what you posted.
> Chronic deficits or
> chronic surpluses are both bad
Let’s make sure we’re using the same terminology. When you are up to your eyes in debt, spending less than you earn, is not a surplus. The last time this country was out of debt where it would have been possible to run a surplus was more than a century and half ago and thus no one has ever accused the US of a “chronic surplus.” Because of that, the only meaningful term is a chronic deficit.
What your reference is really trying to say is that deficit spending in time of emergency is acceptable. Thus, deficit spending to win a war is OK. No disagrees with that. Furthermore, what economists are also saying is that SOME deficit spending is OK. When the national debt is say 5% of GDP, then SOME deficit spending isn’t going to matter. When the national debt is 50% of GDP, adding to it is a serious problem. The last time the national debt was as high, as a percentage of GDP, was during WWII.
Deficit spending on investments is not bad if the expected return on your investment is expected to exceed the cost and if it does overtax your debt-to-income ratio. For example, people go into deficit spending when they buy a house with the presumption that it will go up in value. Further, the house represents a tangible, capital asset. Individual investments like these, even houses, are far more liquid than say investments in Medicare.
> If, on the other
> hand, the deficit finances
> wasteful expenditure or
> current consumption…
For example, the stimulus bill…
> …most would recommend
> tax cuts to stimulate
> private investment
Which is the exact opposite of what Obama plans to do…
> …transfer cuts, and/or
> cuts in government
> purchases to balance the budget.
Which is also the opposite of what Obama is planning to do.
> When an economy goes
> into a recession (say, due
> to monetary policy), deficits
> usually rise,
Indeed they do which is why it is prudent for governments to have a reserve fund specifically to handle down economies. The Federal government has never managed to figure that out.
> Active policy-making takes
> too long for politicians
> to institute and too long
> to affect the economy.
Exactly so. Which is why the Republicans were pushing for maintaining the tax breaks and holding off on massive expenditures like say a universal health care plan, until the economy recovered.
*Sigh*..it’s a good thing I emphasized this. It should read:
…and if it does NOT overtax your debt-to-income ratio…
“The last time this country was out of debt where it would have been possible to run a surplus was more than a century and half ago and thus no one has ever accused the US of a “chronic surplus.” Because of that, the only meaningful term is a chronic deficit.”
Wrong.. Perhaps you missed this bit of news from nine years ago….
September 27, 2000 Web posted at: 4:51 p.m. EDT (2051 GMT)
WASHINGTON (CNN) — President Clinton announced Wednesday that the federal budget surplus for fiscal year 2000 amounted to at least $230 billion, making it the largest in U.S. history and topping last year’s record surplus of $122.7 billion.
“Eight years ago, our future was at risk,” Clinton said Wednesday morning. “Economic growth was low, unemployment was high, interest rates were high, the federal debt had quadrupled in the previous 12 years. When Vice President Gore and I took office, the budget deficit was $290 billion, and it was projected this year the budget deficit would be $455 billion.”
Once Bush was in office he and Alan Greenspan began arguing that the federal government needed to eliminate the surplus (This is from the Wall Street Journal): “Giving a big boost to President Bush, Chairman Alan Greenspan reversed his long-held view and said he now sees room for significant tax cuts in the federal government’s financial future…. Over the coming decade, the latest budget surplus numbers show not only room for reductions, but even a need.”
“What your reference is really trying to say is that deficit spending in time of emergency is acceptable.”
Exactly, and an economic collapse constitutes a national emergency, Google “Economic Collapse 2008, or 2009”, we were on the brink.
“…people go into deficit spending when they buy a house with the presumption that it will go up in value. Further, the house represents a tangible, capital asset.”
Unless the house values are based on a liquidity bubble caused by massive tax cuts for the rich financed by deficit spending. (In which case it represents stupidity). Once the home values collapsed, unemployment soared. This time next year over a third of all American “homeowners” will underwater on their mortgages. The feeling in their guts is very tangible.
> If, on the other > hand, the deficit finances > wasteful expenditure or > current consumption…
“For example, the stimulus bill…”
One third of the stimulus bill was in the form of tax cuts.
> …most would recommend > tax cuts to stimulate > private investment
“Which is the exact opposite of what Obama plans to do…”
Wrong! Here are the three parts of the stimulus bill:
**Tax Relief for Families and Businesses: The single largest component of the Act was over $280 billion in tax cuts. As a result of the Act, more than 95% of working Americans have received a tax cut, and small businesses are paying lower taxes on capital gains and through expanded net operating loss provisions. These tax cuts reflect many of the priorities that you and others urged the President to adopt.
**Direct Relief to States and Vulnerable Americans: The second component of the act was $270 billion in relief to state and local governments – to ensure that we were supporting recovery in all parts of the country and to ensure that the most vulnerable Americans could weather the economic crisis. Already, state and local governments have received over $100 billion to avoid layoffs of teachers, firefighters and police offers.
**Critical Investments to Create Jobs and Rebuild our Economy: The third component of the act is financing the largest investment in roads since the creation of the interstate highway system; an historic effort to create the clean energy jobs; an effort to digitize the nation’s medical records and a program to extend broadband across the country. These investments are creating jobs today while laying the foundation for stronger more durable economic growth in the future.
“The Republicans were pushing for maintaining the tax breaks and holding off on massive expenditures like say a universal health care plan, until the economy recovered.”
Wrong! The Baucus bill will reduce the debt by $84 over the next decade. In contrast, in 2003, the Republican White House and Congress passed the Medicare Prescription Drug bill. It was not offset by either spending cuts or tax increases. Through the end of the decade, the Prescription Drug Bill will have cost more than $1 trillion including interest costs.
You are certainly entitled form your own opinions. You are not entitled to make up your own facts.
RE: “Surplus”
You are reading media spin. The budget surplus of which they refer simply means that yearly expenditures were less than yearly revenue for the first time in a long while. It does NOT mean that the national debt was zero. We haven’t had a “surplus”, meaning ZERO debt, for well over 150 years. Thus, my statement still stands. You cannot have the concept of a surplus when you owe 50% of what you make in a year. In our lifetimes, we have never even encountered the very concept of a “chronic surplus.”
Yes, Bush made the national debt worse by running yearly deficits just as Obama is doing now; only Obama is going to put Bush to shame in that department. The way Obama is going, he’s going to double the national debt in four years instead of the eight it took Bush.
> Exactly, and an economic
> collapse constitutes
> a national emergency,
Again, you need to separate the issues. Issuing TARP *loans* in order to help the financial industry stabilize (and thus eventually getting your money back) is a far cry from pissing money away on the auto industry for bad management practices. They are worlds different. Most of Obama’s deficit is not in TARP loans.
RE: Porkulus
Actually, only 12 cents on every dollar of the porkulus bill is actually towards anything relating to actual growth stimulus. (http://online.wsj.com/article/SB123310466514522309.html)
> The single largest
> component of the Act
> was over $280 billion
> in tax cuts.
http://washingtonpost.com/wp-dyn/content/graphic/2009/02/01/GR2009020100154.html
First, the final bill only included 182 billion of tax credits. Second, of that, Only $82 billion of the $800+ billion bill actually relates to tax credits to individuals. In reality, the actual amount of tax relief is a pittance. The maximum credit is 400 per individual or 800 per couple. Luckily, tax breaks for the poor don’t cost much because they don’t pay any tax.
> The second component of
> the act was $270 billion
> in relief to state and
> local governments
Again, not true. If you look at the link you will notice that only 79 billion is dedicated to the State Stabilization fund which includes money for education and thus teachers and such.
Btw, in all of this you are forgetting the massive tax increase on the “wealthy” making over 250K a year. But hey, we don’t care about them right?
> The third component
> of the act is financing
> the largest investment in roads
Only 30 billion is being spent on highway construction. I’m curious if the claim that it is the most since the Interstate Highway system accounts for inflation. I bet not.
RE: Homes
Clearly, you did not understand the analogy. A home, like a loan, is at least a capital asset, unlike, say the 4 billion spent on such groups such as ACORN.
> The Baucus bill
> will reduce the debt
> by $84 over the next
> decade.
When pigs fly. Are these the same people that claimed that unemployment would peak at 9%? How will that $84 billion over ten years pay for the $800 billion they just spent in a single year? Btw, there is also the issue of the present value of money. That $84 billion will not be worth as much over the next 10 years as it does now so the savings is paltry in comparison to spending.
Making up facts indeed. You need to get it into your head that not running a deficit does not mean you are out of debt. Spending 10 dollars in a single year to save 1 dollar over the course of 10 years is bad fiscal management.
This is the definition of a deficit and a surplus:
“A budget deficit occurs when an entity spends more money than it takes in.[1] The opposite of a budget deficit is a budget surplus.”
The cumulative sum of the deficits is called the national debt. The national debt was about $5.5 trillion when Bush took office. It’s now just shy of $11 Trillion. George W. Bush increased the national debt more than all the previous presidents combined. Before you attack President Obama for trying to make the best of the worst economic situation since the Great Depression I would consider it the right thing to do to apologize for your part in bringing the country I love, the greatest country in the world, to its economic knees.
I am fully aware of the difference between the deficit and the national debt which I’ve been trying to explain to you all along. A budget “surplus” is meaningless in the face of trillions of dollars of debt. It is media spin. “Hey, we spent less than we made for once. We’re doing good!” Baloney. If you owe many times what you make in a year, simply spending less than your entire income in a given year is not a surplus. A surplus would only be if you had no debt.
In Obama’s first year, he has racked up a deficit larger than Bush did in his last three years. I could easily make a similar excuse for Bush as you have for Obama. “Before you attack Bush consider we were heading into a recession at the beginning of his Presidency and we were attacked.” It’s an excuse and like all good excuses, there is an air of validity to it. Yes, we were heading into a financial crisis at the outset of Obama’s Presidency which was abated by Obama and Bush with TARP. However, Obama has done far more than bailout the financial industry. He chose to bailout the automakers (which are now going into bankruptcy court). He chose to push for the porkulus bill which has not improved the economy but has put us billions further into debt.
You cannot use the excuse of an emergency to justify all spending. A good portion of the spending beyond capitalizing the financial industry is waste IMO. Yes, Bush’s policies made it worse and Obama’s current policies are making it even worse yet.
By the way, speaking of emergencies, in the next couple of years, it is likely that some of the States like CA will require bailouts. From where will the money for that will come I wonder?