Does Anyone feel like Bailing

[classicman]

Only after several rounds of back-and-forth did he agree with Representative Chet Edwards, Democrat of Texas, that tax cuts do not entirely pay for themselves. And he danced around with Representative Gerald E. Connolly, a Virginia Democrat,

on whether the Obama administration’s $787 billion stimulus package last year was “necessary.”
Mr. Bernanke would only say it was “useful.”

“It must be nice to be an economist,” Mr. Connolly replied.

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That's an interesting choice of words - useful.

Originally Posted by classicman

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That's an interesting choice of words - useful.

Numerous economists would disagree.

But the larger issue is what would have happened w/o the stimulus and no one knows.

I am one of those who believed at the time, and still believe, that is was far better than the risk of do nothing and hoping the economy did not continue to tank.

And, I still havent heard any better solution from those who criticize the program.

BTW..... Bernanke also said, “This very moment is not the time to radically reduce our spending or raise our taxes, because the economy is still in a recovery mode and needs that support.”

And, I agree. Short term spending to stabilize the economy should take precedent for now over dealing with long term debt. The recovery has started, but it is not yet complete or fully stabilized. When the economy is growing again at a healthy rate, the precedent should change.

[classicman]

So the recession is over. Great news.

Originally Posted by classicman

So the recession is over. Great news.

When did I say the recession is over?

I said the recovery has started...and gdp growth over the last 4 quarters would support that. Nearly all economists will also tell you that jobs are the last to recovery from a recession.

Misrepresenting my post again?

[classicman]

A cycle following a recession, during which the GDP rises.

Isn't that the definition of a recovery?

Originally Posted by classicman

Isn't that the definition of a recovery?

Recessions are generally considered over when sustainable gdp growth is achieved over a period of 12-18 months (or 4-6 quarters). Those 5th and 6th quarters also allow for job recovery, again, recognizing that jobs are the last to recovery.

Officially, we should be out of the recession this summer or fall.

So what do you think?

Should we stop spending now and make debt reduction the top priority?

Or, should we continue spending for a little longer on programs that many (certainly not all) economists think will continue to help the still fragile economy and job creation, including tax cuts to small businesses, significant infrastructure funding, etc....and programs to help the unemployed, including UI extensions and COBRA subsidies that were in the recovery act.

[classicman]

My opinion has and still is that there is/was too much waste. That the deal was done and money which was used to buy votes and/or return favors would have been better allocated elsewhere, used later or not at all.
I think there were projects that had very little stimulus effect and/or job creation potential.
As somewhat of a side note, the creation of private sector jobs appears to be dismal. Many of the jobs created were Gov't related. Additionally, it looks like the numbers there are less than accurate as well. Apparently the census jobs (which I don't think should have counted at all) have been inflated.
No cites no links - nothing. Just my opinion.

Regarding the deficit ... That should have been a priority 5-10 years ago.
I have a personal aversion to owing money.

ETA - didn't they just cut 40mil/bil from medi-care/caid? IIRC, the cobra extension was eliminated as well.

[tw]

Originally Posted by Redux

Recessions are generally considered over when sustainable gdp growth is achieved over a period of 12-18 months (or 4-6 quarters).

And that type of recession is the third type - a type directly traceable to massive economic mismanagement. Other type recessions are not as severe and not as long.

Historically, jobs do not start coming back until quarters after the recession has ended. Jobs are a lagging indicator. And lost due to massive fiscal mismanagement typically four and more years earlier.

[tw]

Originally Posted by classicman

Regarding the deficit ... That should have been a priority 5-10 years ago.

It was. The solutions were in place. The 30 years Treasury Notes were discontinues because government no longer had to borrow as much money. And the solution, if left in place in 2000, would have solved the deficit.

Then some fool said tax cuts (money games) create economic wealth. As Buffet said, the only real tax cut is one that cut spending. So wackos increased spending massively, gave welfare to the rich, and reduced the American income by 2% from 2000 to 2008. Welcome to the resulting job losses today.

We discussed this almost ten years ago - the Kennedy tax cuts. The spin was Kennedy cut taxes to boost the economy. Spin works on those who believe only what they are told to believe. Posted was the reality. Those Kennedy tax cuts cause an economic boost - followed by recession in the Johnson administration. That is what tax cuts really do. Massively increase debts that result in recession and job losses four and more years later. And still so many know tax cuts are good because extremist politicians said so.

Learn from reality. The deficit was being solved. Then wacko politicians decided to 'fix' the economy. They were so dumb as to even recommend putting social security into the stock market.

Originally Posted by tw

And that type of recession is the third type - a type directly traceable to massive economic mismanagement. Other type recessions are not as severe and not as long.

Historically, jobs do not start coming back until quarters after the recession has ended. Jobs are a lagging indicator. And lost due to massive fiscal mismsanagement typically four and more years earlier.

I dont disagree.

We are a long, long way from full employment....and that will take significant economic restructuring.

And IMO, that has to include, in part, govt investments in emerging industries/technologies. At the same time, there can some deficit reduction with freezes or cuts on some discretionary programs AND allowing the temporary 01 and 03 tax cuts on the top bracket to expire, returning to the pre-2000 rate....a rate which certainly did not stifle economic development.

[Spexxvet]

Originally Posted by classicman

...
As somewhat of a side note, the creation of private sector jobs appears to be dismal....

And you have to question why.

The rich are getting richer. As the world recovers from the global economic crisis, the global wealth staged a remarkable comeback in 2009, increasing by 11.5 per cent to $111.5 trillion, just short of the year-end peak set in 2007.

Less than 1 per cent of all households were millionaires, but they owned about 38 per cent of the world's wealth, up from about 36 per cent in 2008, according to a new study by The Boston Consulting Group (BCG).

Households with more than $5 million in wealth represented 0.1 per cent of households but owned about 21 percent, or $23 trillion, of the world's wealth, up from 19 percent in 2008.

The number of millionaire households rose by about 14 percent in 2009, to 11.2 million -about where it stood at the end of 2007

from here
It seems that, in general, the people who have the ability to create jobs are not creating jobs.

[classicman]

Originally Posted by Spexxvet

And you have to question why.
It seems that, in general, the people who have the ability to create jobs are not creating jobs.

OK, Why?

[tw]

Originally Posted by classicman

OK, Why?

Because we are now paying for the boondoggles. Bills from Mission Accomplished are just starting to flow in. We now have a massive interest payments on debts used four and nine years ago to finance money games. Because GM was told after 2000 that they did not have to innovate; did not have to manufacturer the hybrid that was paid for by the US government starting in 1994. Because shorting pension funds to claim profits was suddenly legal. And now those funds are short $tens of billions. Because welfare to the rich never creates productive jobs. Because money games means jobs must be lost four and ten years later. Because any and all protection for secure investements (ie Glass Stegall) was removed in the name of "finance people can always be trusted". Because the American government had so much contempt for thing that create jobs (science, innovation) as to even have White House lawyers rewrite the science papers. Because America was openly encouraged to massively increase energy consumption (ie SUVs) so as to increase profits rather than make new jobs and inefficient industries. Because the people who destroy innovation were not removed as long as they played money games to hide the massive losses (ie Nardelli in Home Depot, Merril Lynch, AIG, the banks). Because money games (Enron, LTCM, Madoff, AIG, mortgage back securities) were how wealth was created and encouraged - and the bills have now just starting arriving. Because the nation’s incomes have dropped 2% while economic fiscal mismanagement and money games were masking the inevitable in the name of a voodoo economics. And because Tax Cuts and George Jr stimulus plans are now doing to the economy exactly what they were predicted to do by this author how many times how many years ago.

The rich do not create jobs - no matter how many times that myth is promoted. Only innovation creates jobs. And innovation only comes from the little people - who have suffered a 2% reduction in their incomes after 2000. That has never happened since 1929 when the same money games also created an economic disaster.