Monday open thread
What makes resisting temptation difficult, for many people, is that they don’t want to discourage it completely.
What temptations did you succumb to over the holiday?
November 26, 2012 - 6:07 AM
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November 26, 2012 - 6:07 AM
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Sunday, May 19, 2013
THE ROANOKE TIMES
Surprisingly astute commentary at the Daily Beast: http://www.thedailybeast.com/articles/2012/11/24/the-unanswered-question-what-about-clinton-era-spending-rates.html
According to official government figures, the feds collected revenues totaling 20.6 percent of the gross domestic product in 2000, the final full year of Clinton’s term. Under Obama in 2012, however, Washington spent money at a near-record rate of 24.3 percent of the GDP. Even with all of Clinton’s tax revenues, that still would have left a deficit of 3.7 percent of GDP, significantly higher even than the worst full year of the much-reviled George W. Bush.
To put the situation in perspective, federal spending went up from 18.2 percent of the economy in the last year of the Clinton administration, to 20.8 percent in the last full year of the Bush administration, to 24.3 percent of the just-completed fiscal year. In raw dollar terms, the Clinton government shelled out an even $2 trillion for all federal programs. The Obama administration is lavishing $3.2 trillion in constant dollars even before its costly health-care reform takes effect.
Yes that is an interesting article. It went on to say: “Conservatives ought to face up squarely to the uncomfortable fact that there’s scant evidence that sharply reduced taxation since the Clinton era has helped middle-class Americans build wealth or improve their economic standing.”
And to answer his probing question, It is “appropriate to consider reinstating Clinton-era rates of taxation” AND to head towards the Clinton era patterns of spending also.
Mr. Obama already started that by signing the bill reinstating “pay as you go”. How many TP/R votes did that bill get?
He, like many right wingers just blithely ignores the economic crash and acts as if Obama just went on a spending binge for the hell of it.
http://www.marketwatch.com/story/obama-spending-binge-never-happened-2012-05-22?pagenumber=1
http://www.politifact.com/truth-o-meter/statements/2012/may/23/facebook-posts/viral-facebook-post-says-barack-obama-has-lowest-s/
To #2 (Sandi): Michael Medved’s criticism of conservatives is correct. And yet (as typical) you ignore the very next sentence where he criticizes Democrats:
“But Democrats and other Obama apologists must confront the even more obvious truth that similarly steep hikes in federal outlays have done nothing to lift the circumstances of ordinary Americans. Washington has increased its share of the national economy by a frightening 34 percent since Slick Willy left office. It’s not possible to blame all of that on Bush’s two costly wars or his prescription drug benefit, as Obama increased federal spending as a share of GDP far more rapidly than did Bush.”
And the “economic crash”? It’s been over since June of 2009. Why are we continuing to spend all of this extra money 3.5 years after it ended? Or there ever a time when we can expect the extra spending to end, or is spending 24% of GDP the “new norm”?
I did not ignore it, I even mentioned that he, like many right wingers just blithely ignores the economic crash and acts as if Obama just went on a spending binge for the hell of it. That was precisely the point I was referring to. He acts as if Obama just continued the spending where Bush left off and that is literally not the truth.
Ask these folks if the economic crash has “been over since June of 2009“. They do not think so.
“Our book examined both levels and rates of change of per capita GDP; recovery is defined by the time it takes for per capita GDP to return to its pre-crisis peak level. For post- World War II systemic crises, it took about four and a half years to regain lost ground; in 14 Great Depression episodes around the world (including the U.S.) it took 10 years on average. A focus on levels, rather than percentages, is a more robust way to capture the trajectory of an economy where the recovery is more U- or L-shaped than V-shaped.”
http://www.bloomberg.com/news/2012-10-15/sorry-u-s-recoveries-really-aren-t-different.html
http://www.amazon.com/This-Time-Different-Centuries-Financial/dp/0691152640
Your refusal to see the reality is as glaring as Medved’s and springs from the same myopia.
To #5 (Sandi): I’m well aware that the recovery has been lackluster. Indeed, it’s been one of my strongest criticisms of the Obama administration (with the excess accumulation of debt being the other). Please remember Obama’s own words, “If I don’t have this done in three years, then there’s going to be a one-term proposition.“. http://www.politico.com/news/stories/1012/81895_Page2.html
If your assessment of a continuing crash is correct, then I hope you held Obama to his word and didn’t vote for him.
However, your assessment flies in the face of the NBER report, http://www.nber.org/cycles/sept2010.html, that has been accepted by most economists. The economy is no longer shrinking (which is what constitutes a true crisis). It’s just growing more slowly that we’d like. Because the true crisis is over, the time for giant stimulus efforts (like the past ARRA and QE1/QE2 actions and the continuing QE3/FHA actions) is also over. Even John Maynard Keynes would be opposed to current debt-fueled efforts to speed up the recovery.
And as a technical matter, a recession is considered over when GDP quits shrinking. That happened in June of 2009. You seem to be waiting for per-capita GDP to recover all the way to its bubble-inflated pre-recession peak before declaring things okay. That could be many years from now, and we simply cannot afford the borrowing that the administration seems to want to get us there.
It is not my “assessment”. I never said it was. I rely on people far smarter and with much more research and information in their conclusions. Are you saying Carmen M. Reinhart and Kenneth Rogoff are just plain wrong? She is the “Minos A. Zombanakis Professor of the International Financial System at Harvard Kennedy School” and he is “the Thomas D. Cabot Professor of Public Policy and Professor of Economics at Harvard University“.
I can find nothing to quibble with their analysis (although I have not completed the book).
I am not saying that Obama has done everything right or that Congress has a clue, but I think you continue to ignore that which does not suit your ODS rather than admit this was more than just a recession that is only technically “over”.
And, not for nothing, but your own link is not all that concrete on a “recovery”. “In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month. A recession is a period of falling economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. The trough marks the end of the declining phase and the start of the rising phase of the business cycle. Economic activity is typically below normal in the early stages of an expansion, and it sometimes remains so well into the expansion.”
http://www.nber.org/cycles/sept2010.html
They also did not mention the debt and deficit that are forcing us into decisions we may not be economically able to sustain. You can want this to be all on Obama, but that just makes you wrong, IMO.
To #7 (Sandi): Why do you do that? “You can want this to be all on Obama, but that just makes you wrong.” Why do you assume I’m criticizing Obama and nobody else? My criticism of government actions goes far beyond just Obama. The list of culprits includes congressional Republicans, congressional Democrats, George W. Bush, and the Federal Reserve, all in addition to Obama. Perhaps you need to look in the mirror and see if it’s actually you suffering from ODDS, i.e., Obama Deranged Defense Syndrome: “Where a person feels compelled to defend Obama from every perceived criticism, legitimate or bogus, real or imagined.”
And yes, Sandi, by the standard definition that economists use, the recession is over. Has been for 3.5 years. Take an economics course and learn what the jargon actually means. Please.
Now if you want to talk about the quality of the recovery, that’s a different discussion entirely. And by all measures, this recovery has been exceptionally crappy and reflects poorly on the actions of the Democrat-controlled Congress of 2009-2010, the split-controlled Congress of 2011-2012, the US Federal Reserve, and yes, the Obama administration.
The articles and books to which you linked actually do show some insight into how recessions dominated by excess debt (like our latest one) have lengthier recoveries. Unfortunately, nobody in Congress or the administration seemed to have a clue about this. They were all expecting a “V”-shaped recovery, which explains the emphasis on short-term stimulus spending and the ludicrously incorrect estimate of how much the ARRA would help the economy: http://www.zerohedge.com/news/guest-post-chart-tears-apart-stimulus-package. With multiple trillions spent in direction stimulus or indirect “quantitative easings” with little overall benefit to the economy, I must quote Robert Samuelson: “It’s hard to avoid a sneaking suspicion that the people at the top don’t know what they’re doing.“
Brian, I “do that” because you and others here, (in addition to taking every opportunity to denigrate my intelligence or knowledge) keep talking about “the Obama administration” and no one (and nothing) else when you lament the economy. You may expect me to infer all those other players but you did not mention them until I made the comments above and then you use them as a cudgel. Sweet.
If you had said you included “congressional Republicans, congressional Democrats, George W. Bush, and the Federal Reserve, all in addition to Obama”. I would have had no complaint. I think you know that too.
I do not suffer from “ODDS”. I suffer from people appearing to be short sighted and lacking in memory. This situation was a long time coming and had many, many hands from all sides of the political and financial spectrum in on it. I have NEVER argued against that truth, and never would. That, however is not what you led off with. It virtually never is.
I did not argue that “by the standard definition” the recession was not over. I am not remotely equipped to argue economics other than the basics. I just think that saying so without the caveats looks ignorant and vindictive. I do not need to “Take an economics course” to express my opinions here and I did not get any “jargon” wrong. Even the experts you linked to admitted the caveat.
The need some here feel to brow beat me and dismiss my opinions is an ongoing meme that serves no one. Some days the comments here are so scant as to be sad as it is. You folks appear to just want an Amen Corner?
Frankly Brian, I no longer want to “talk about” anything with you. Between you and Jim Lucas this place has become toxic to me. You two go on and wallow in your self-satisfying explanations for everything.
#9 – “Brian, I “do that” because you and others here, (in addition to taking every opportunity to denigrate my intelligence or knowledge)…”
I find it extremely ironic to see that coming from someone who routinely tells people that they don’t understand, are confused, etc.
Perfect example in your very own post: ” I suffer from people appearing to be short sighted and lacking in memory.”
I would suggest that before you accuse others of denigrating your knowledge or intelligence that you first take a long look in a mirror.
To #9 (Sandi): You said, “Frankly Brian, I no longer want to “talk about” anything with you.”
Then don’t. You were under no obligation to respond to my post #1, nor any of my subsequent posts.
And I can’t say that I’d miss the interactions either. I’m tired of having to provide you with complete lists of culprits when criticizing government actions. Nobody else demands them and presumes the worst if they’re not all listed. Only you.
Indeed, your focus on criticism of Obama caused you to miss the main point of Michael Medved’s commentary: What about the spending side of our enormous deficit problem?
Michael, I will if you will.
I rest my case.
The “toxic”ity shows. I suggest (prescribe?) a dose of “intelligence” & being “objective”.
In all honesty Mrs. Saunders….several people have tried to express general economic principles…you attack based on (IMO) political & (IMO) misplaced personal sensitivity.
Case in point?: ‘Frankly Brian, I no longer want to “talk about” anything with you. Between you and Jim Lucas this place has become toxic to me. You two go on and wallow in your self-satisfying explanations for everything.’
Mrs. Saunders, I have not posted on this blog for two days & until now not on this thread.
As to being “associated” with Mr. Lindhholm (not in any “attack” on you, but to the principles involved) thank you. I find his posts among the most lucid here.
Case in point?
The last (final line) “Case in point” was a copy/paste error. Sorry/thanks.
Precisely! You all want the Amen Corner and the rest of us to just shut up. This is the recurring pattern on thread after thread after thread.
I very seldom offer an economic perspective without citing my source or inspiration. Like the issue of climate change, economics has a multi-faceted and divergent community that does not always agree on any point. I have made no claims to economic prowess but it does not take a genius to see what so many of you always want to leave out when bemoaning the Obama administration and the economic recovery or anything related to the economy either.
That you disagree with me or try to denigrate my points does not make me wrong. I consider my sources, Robert Reich, Dean Baker, Paul Krugman, and Joseph Stiglitz, as well as Bruce Bartlett whom I often cite, are not slouches in the field.
For the record, it was Brian who chose to make the discussion personal in his post #3: “…And yet (as typical) you ignore…” I am not the villain here all of the time, nor do I respond in any vacuum.
#16 – “You all want the Amen Corner and the rest of us to just shut up. This is the recurring pattern on thread after thread after thread.”
This, coming from someone well known here for her snide comments and frequently insulting the intelligence of other posters (“You don’t understand”, “You’re confused”, etc…)
In all seriousness, Sandi, if this place is so toxic, why come here?
#13 Thanks for proving Sandi’s point, Michael.
#17 “well known here for her snide comments”
You get what you give, Michael. Again, thanks for proving Sandi’s point.
#18 – Actually, Steven, you really don’t know the whole story concerning my reply. My original reply was not posted, so what did get posted in #13 made no sense without what should have been #12.
May I recommend refraining from posting about something you truly don’t understand?
Well, to try and steer this thread back to policy discussion… I originally linked to Michael Medved’s Daily Beast article (in comment #1) to emphasize how little discussion we’re seeing from Washington on reducing spending.
And then today the following AP article came out: http://news.yahoo.com/senate-dems-divided-over-cuts-benefit-programs-075320398–finance.html. Key quote:
Democrats already have tried to take Social Security off the table. Carney, the White House spokesman, said Monday that changes to the massive retirement and disability program should be done separately from any plan to reduce the deficit. That’s the same position taken by 28 Democratic senators and independent Sen. Bernie Sanders of Vermont in a letter to fellow senators in September.
“We will oppose including Social Security cuts for future or current beneficiaries in any deficit-reduction package,” said the letter, which was signed by many top Democrats, including Majority Leader Harry Reid of Nevada. In the House, Democratic leader Nancy Pelosi has taken the same position, not only on Social Security, but also on Medicare and Medicaid.
Any thoughts on this? It sounds like the Democrat’s equivalent to a Grover Norquest pledge to me. Unhelpful in the extreme.
And what will Congress do with the payroll tax holiday? http://news.yahoo.com/pandering-boneheaded-motives-behind-payroll-tax-holiday-071100959.html
Questions, questions, questions… It sure would have been nice if this stuff had been discussed before the elections.
And the Republicans have already tried (and still maintain the position of) taking raising taxes off the table.
“…raising taxes on the so-called top 2 percent — half of those taxpayers are small-business owners that pay their taxes through their personal income tax filing every year. The goal here is to grow the economy and control spending. You’re not going to grow the economy if you raise tax rates on the top two [percent]. It’ll hurt small businesses; it’ll hurt our economy.”
http://www.huffingtonpost.com/2012/11/28/john-boehner-fiscal-cliff_n_2204931.html
SOSO
The notion that a cut (or holiday) in the portion of the payroll tax the employees pay would ever spur employment – job growth – only shows the typical lack of knowledge of the basic principles of microeconomics on the part of Washington.
The tax holiday put some money in the hands of consumers, true, and that is a good thing…but it didn’t decrease the cost of employing the workers to begin with; a cut/holiday on the employer side would have done that, meaning there is less money being lost to Washington, meaning employers can hire more.
Here’s a discussion of the tax deal from an Austrian school perspective.
http://mises.org/daily/4910
Goodness. Even the mainstream media is getting it:
http://www.usatoday.com/story/news/politics/2012/11/28/fact-check-durbin-social-security/1732877/
Sen. Richard Durbin says that “Social Security does not add one penny to our debt.” That’s false. It was wrong 21 months ago, when Durbin said it once before, and it’s even more off the mark now.
http://www.washingtonpost.com/opinions/mr-obamas-time-to-lead-on-entitlements/2012/11/27/0430b112-38c8-11e2-8a97-363b0f9a0ab3_story.html
Since his reelection, Mr. Obama has fueled a campaign-style effort to pressure Republicans to give ground on taxes. That’s fine, but it won’t be enough. At some point, he has to prepare the American people — and his own supporters most of all — for the “hard decisions” required to put the country on a sound financial footing. That means spending cuts, it means entitlement reform, it means compromise, it means a balanced solution that will please neither House Speaker John A. Boehner (R-Ohio) nor Senate Majority Leader Harry Reid (D-Nev.). Only one person is in a position to make it happen.
Will we see real leadership from Democrats, or will they stick their heads in the sand and kick the can once again?