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Tilting at Windmills

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April 28, 2006
By: Kevin Drum

WRONG TRACK....The New York Times reports that the Commerce Department is expected to announce strong economic growth Friday morning. But something strange is going on:

In the most recent CBS News poll, conducted last month, 55 percent of respondents rated the economy as good, even though 66 percent of Americans said the country was on the wrong track. In 23 years of polling by CBS, only once in late 2005 did a higher percentage of people say the country was on the wrong track.

That is unusual. Normally people are pretty satisfied when the economy is strong. Perhaps the explanation is lower down in the article:

Spending by upper-income families appears to be driving much of the economy's growth. The average hourly wage for rank-and-file workers who make up roughly 80 percent of the work force has fallen by 5 cents in the last four years, to $16.49, after inflation is taken into account.

Yep, that might account for it. For most of us, trickle-down economics is more like Republican water torture.

Kevin Drum 1:24 AM Permalink | Trackbacks | Comments (151)

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"Republican water torture." I like that it. It's kind of catchy.

Of course, perhaps there is no economic explanation - perhaps people are just sort of pissed off. You know, sort of a national malaise.

Posted by: Jim D on April 28, 2006 at 1:31 AM | PERMALINK

Well, you answered your own question.

But for information, can anyone show me exactly how they measure inflation (I've read UScensus) and unemployment. Critical info. To me there's something incomplete in the story of both.

Posted by: notthere on April 28, 2006 at 1:31 AM | PERMALINK

How can the economy be doing well when the amount of new unemployment claims filed last week was much higher than anticipated? Not to mention the mean salary of an American household has not changed since the early 90's. Maybe people think the economy is doing well, maybe these same people are not getting all the numbers.

Posted by: Ryan Oddey on April 28, 2006 at 1:34 AM | PERMALINK

National malaise?

Your productivity goes up, your hours go up, but you get pissed on in the pay raise. You loose your job and you find downward mobility is a reality. I'll say there is a national malaise and I know where it starts. Right at the top.

Posted by: notthere on April 28, 2006 at 1:34 AM | PERMALINK

I'd say that GOP and its syncophants are really the ones who are out of touch with mainstream America.

Just shouting "culture of life!" isn't making people feel economically secure.

Posted by: craigie on April 28, 2006 at 1:42 AM | PERMALINK

Last time I looked, hourly workers were 60 percent of the U.S. work force. What happened?

Posted by: tbrosz on April 28, 2006 at 1:45 AM | PERMALINK

rank and file workers != hourly workers

Posted by: lib on April 28, 2006 at 1:52 AM | PERMALINK

I'm still waiting for the Democrat solution to America's "malaise".

Posted by: Donkey_Courage on April 28, 2006 at 1:54 AM | PERMALINK

Maybe the fact that a large segment of the news media simply refuses to accept the possibility of a good economy, no matter what the statistics, has something to do with this "level of discomfort."

It is almost impossible to find a news story containing positive economic statistics that does not have at least several negative qualifiers in it somewhere. Heck, in this particular article, they manage to cram a lot of them in the very first paragraph.

Posted by: tbrosz on April 28, 2006 at 1:57 AM | PERMALINK

It is almost impossible to find a news story containing positive economic statistics that does not have at least several negative qualifiers in it somewhere.

Heh. Goose, meet gander.

This is what you get when you turn the news into he-said, she-said storylines. Up to now, the GOP has benefited from this (which is why they worked the refs so hard to get the stories presented this way). Now the shoe is on the other foot, and you're upset. Boo hoo.

And secondly, your insistence that somehow people don't understand how much money they have, how much they owe, how much their healthcare costs, what the balloon on their adjustable mortgage is going to be, unless the media tells them, is pathetic. People don't listen to Fox to know how rich they feel, they look in their checkbooks.

Posted by: craigie on April 28, 2006 at 2:02 AM | PERMALINK

Shorter tbrosz: If the media would just stop reporting the bad news, the good news would make so much more sense!

Posted by: greenink on April 28, 2006 at 2:02 AM | PERMALINK

Actually, since the true value of inflation is higher than reported, thanks to the highly questionable "hedonics" adjustments, the 80% not at the top have lost more than five cents.

Oh, and tbrosz, people make their judgments about the economic situation by looking around and talking to their friends, not by reading the media. Also, if a news story containing positive economic statistics in today's economy did not have qualifiers, it would be a biased story (as would a story claiming that every aspect of the economy is bad). Are you asking for bias? There's a cable news channel that might work for you.

Posted by: Joe Buck on April 28, 2006 at 2:05 AM | PERMALINK

Yes, what can tbrosz do when even the facts are biased?

Posted by: Stephen Colbert on April 28, 2006 at 2:07 AM | PERMALINK

All this whining will disappear if these unemployed people just find some jobs, which everyone except the main stream media knows to be plentiful.

Posted by: tbrosz on April 28, 2006 at 2:10 AM | PERMALINK

Well, they could all get work being fake tbroszs. There seems to be plenty of demand for that.

Posted by: craigie on April 28, 2006 at 2:11 AM | PERMALINK

fakery is underrated. ask GWB.

anyway, real or fake, how does it matter? you get a better appreciation of how a deranged brain thinks.

Posted by: tbrosz on April 28, 2006 at 2:18 AM | PERMALINK

Republican Water Torture is good. Let's keep it.

Also note that the official statistics have yet to capture the commodities inflation that is starting to worm its way through the economy.

Posted by: Nicholas Beaudrot on April 28, 2006 at 2:23 AM | PERMALINK

Notice that commodity prices are up all around, oil, gold, copper, everything, and this commodity price rise seems correlated with world economic growth, more precisely capital spending.

Mortgage rates are up a point from last year, now about 6.2%, and this means inflation has cropped up some.

The trade deficit with China is at a record as usual.

We just had a quarter of economic growth of about 4.5%, annual rate.

Stock market hit a six year high.

The federal reserve chief hasn't a clue, according to his latest testimony.

A few actual deficit hawks are speaking up in congress.

Workers are a little pissed at cheap immigrant labor.

We are probably reaching some resource constraints.

Since lil Bush gets these things wrong most of the time, I expect a downturn for the midterm elections.

For Democrats, don't be too smug because when they all go on the hustings preaching more government spending, the voters will be more concerned with the deficit.


Posted by: Matt on April 28, 2006 at 2:40 AM | PERMALINK

The explanation for the bad track ratings lies in the Iraq war, not the economy.

There's an extensive literature that points that war is the other big explanatory variable to the economy for voters state of mind and assessments of presidents.

Posted by: Nick Kaufman on April 28, 2006 at 2:42 AM | PERMALINK

craigie, people pick out what they want to say from these statistics and run with it.

As one example, that "decreasing hourly wage" one has become a standard. Go to the BLS statistics page, and pull up "Total Private Average Hourly Earnings, 1982 Dollars - Seasonally Adjusted."

Check the graphing function to clarify the readout. Fiddle with the "from" date. Go back to 1990. 1985. 1980. What's the big picture look like? I could write some headlines going either way from this data, depending on what I would be trying to get the reader to believe.

It's certainly true that constant dollar hourly wages have been dropping since 2004. It's also equally true that these same wages have been higher through the entire Bush administration than they were during the entire Clinton administration. True, but a bit misleading, right? If I decided not to show the data, and just made that perfectly true statement, would you spot the hole in it? That's how it's done.

Push the chart back to 1964. That's an interesting graph, isn't it? I could interpret this data any number of ways. Some of them honest.

Posted by: tbrosz on April 28, 2006 at 2:42 AM | PERMALINK

Speaking of wrong track, what's Sully's blog slogan? "To see what's in front of one's nose needs a constant struggle" (thanks to George Orwell).

What's been in front of our noses is that Mary McCarthy, fired CIA analyst, is an expert on West Africa, with a dissertation on colonial Ghana. What else is in West Africa?

Posted by: ogmb on April 28, 2006 at 2:43 AM | PERMALINK

And really 5 cents out of 16.75 cents is infinitesimal.

Kevin, do you really think that a decrease of 0.29% in income can account for such a radical shift in the mood of the country?

Posted by: Nick Kaufman on April 28, 2006 at 2:45 AM | PERMALINK


NYT: In the most recent CBS News poll, conducted last month, 55 percent of respondents rated the economy as good, even though 66 percent of Americans said the country was on the wrong track.
Contrary to tbrosz's spin regarding the media being negative about the economy, the exact opposite is true: they spin it very positively. Putting aside a few telling details that lurk deep within unread columns, most Americans will see only the headlines, such as the one atop the referenced Times article: U.S. Economy Still Expanding at Rapid Pace. Even more pertinent, nearly all references to the economy on television are glowingly positive. Occasionally, a liberal voice will mention some negative aspect; but they are rare, and the general reporting practically screams out the daily message: The economy is going gangbusters!

Such is the backdrop for the dichotomy of a majority rating the economy good, even as an even greater majority thinks it's on the wrong track. They are brainwashed by the entirety of the conservative establishment to believe that their own worsening economic situations do not reflect the nation's overall economic condition. They hear about the deceptively low unemployment rate, not understanding how the number is manipulated not to reflect the growing masses of people who simply are not counted. They hear about a low inflation rate and do not understand how that average number hides the fact of a much greater rise in prices for essentials, which makes the effective rate much higher for anyone whose purchases are mostly composed of such items. And, of course, they hear all the excuses--residual impact from recession (ostensibly caused by Democrats), 9/11, business scandals (ostensibly caused by liberal media), Iraq war (and Afghanistan and WOT and all the other wars our prez is fighting so bravely), Katrina (and other disasters ostensibly worsened by the poor preparation of local Democratic officials)--which the administration never tires of telling us about in order to explain why, yes, we still have work to do. But the economy is strong!, they say, and it will get better if we just make the tax cuts permanent, vote Republican, and watch Fox News.

But any news will do. And, if you're still not convinced, tbrosz is here to set your mind to rest.


Posted by: jayarbee on April 28, 2006 at 2:50 AM | PERMALINK

Donkey_Courage:

Boy! Not nearly enough time or space here.

Basically not to do anything BUsh and his buddies do, and do all those things he doesn't do. That should lead us in the right direction.

Pie in the sky, what does the country need? Complete tax code reform, personal and corporate. Reform of corporate governance especially executive pay negotiation and pension funds. Complete separaton of lobbyists, $$ and people's representatives. Universal health care. $6 a gallon gas. Legal sanctions on companies employing illegal workers, especially bad for those employing workers at sub-pay, sub-conditions. . . and more, and more.

Oh, my list goes on. Repubs worse nightmare. sweet dreams.

Posted by: notthere on April 28, 2006 at 2:51 AM | PERMALINK

We won't be back on "the right track" until we start building much more energy generation capacity: nuclear, wind, solar, synfuels, oil, biofuels. It's coming, but slowly.

Better progress in Iraq would help. Intervention in Darfur would probably be a setback.

Posted by: republicrat on April 28, 2006 at 2:53 AM | PERMALINK

Dere's a war on too. Perhaps it influences?

Posted by: McA on April 28, 2006 at 2:55 AM | PERMALINK

Does anyone have a link to the original poll? I had it and can't find it now. Was "wrong track" a general term, or applied just to the economy?

Posted by: tbrosz on April 28, 2006 at 2:58 AM | PERMALINK

jayarbee: I can see what's going on with the cpi and employment figures. Is there somewhere where there is an analysis of either or both?

tbrosz: 5 cents may not seem too bad unless the repubs keep telling you everything is great, and you hear that growth is 4.5% (no one actually says annualized anymore, so I wonder what the real joe thinks), and you hear one guy takes home $400 million 'cos the price of oil went up (there's a skilful exec!), and your health coverage got more expensive with higher deductibles and co-pays, everyone says you've got to save but you don't have a spare cent.

Then it may seem like you're not getting any of it.

Posted by: notthere on April 28, 2006 at 3:07 AM | PERMALINK

Maybe few others here are renters, but for my money the housing market bubble hasn't been the positive (or even neutral) economic news that nearly all media coverage makes it out to be. I have to pay twice as much or more for a house now than I did five years ago where I grew up (Sacramento, CA), (which sucks worse than it did five years ago). This Bush economy is killing those without a home, and soon it'll be killing my friends who believed the hype and got interest-only loans.

Posted by: DiscoStu on April 28, 2006 at 3:12 AM | PERMALINK


I can see what's going on with the cpi and employment figures. Is there somewhere where there is an analysis of either or both?
Sorry, I can't tell you offhand. Have followed links in the past and read a number of charts and reports. Recently saw a graph which showed that the percentage of eligible (defined as someone aged 16-65) persons in the population who are employed has declined from 69% to 66% (approx.) since Bush took office. This was to reflect the growing numbers of "discouraged workers." While I realize my anecdotal mention of them will carry little weight, I also have seen various analyses which state that the true unemployment rate is somewhere between 12.5% and 15%, and that this "true rate" has increased about 3-5% since the Bush disaster began.


Posted by: jayarbee on April 28, 2006 at 3:26 AM | PERMALINK

3-5% should be 3-5 percentage points.

Posted by: jayarbee on April 28, 2006 at 3:29 AM | PERMALINK

jayarbee: thanks anyway. I guess you can figure backward from total census numbers and projected poulation increase, and assumed illegals, etc., etc. Was hoping for an academic with time on their hands! On the cpi have read the gov blurb on it; figured there might be some analysis of any built in inaccuracies.

republicrat: there's a market driven solution; build power generation. Whoohoo! Any market forces in this, or a direction you'd like to go?
Or do we just need kW?


Posted by: notthere on April 28, 2006 at 3:35 AM | PERMALINK

Dere's a war on too. Perhaps it influences?

Nah, that can't be it. The war's been over for almost 3 years. Remember when victory was declared on that carrier in San Diego.

Posted by: Ray on April 28, 2006 at 3:44 AM | PERMALINK

Easy.

Things are good and getting better, but there are a few obvious things that are wrong that will eventually become problems. We currently pay more SS tax than benefits and operations require, eventually the opposite will happen. Our current system promises a higher return than our economy is likely to produce. The same applies the medicare/medicade. Common fucking sense says that the should benefits we promise should be determined by our capability to produce those benefits.

Next, we still have deficits despite interest rates rising. Previously, deficits were acceptable (not considering the wasteful way they were used) because interest rates were low. We were able to increase our debt with out increasing the portion of our product then went to interest. Interest rates on the rise means that if we countinue have deficits, interest will eat-up a larger percentage of economy. To make things worse, our debt is financed with short-term debt, so even if we eliminate deficits the percentage needed to pay interest can go still increace.

Things are good now, what we've been doing has been good, but if we keep doing things like this, we'll see problems.

Posted by: aaron on April 28, 2006 at 4:00 AM | PERMALINK

aaron--
Not that we weren't here before.With Reagan we started out with high and rising interest rates. Didn't stop our fearless leader from piling on debt. Noone actually does an accounting of how much the Republicans have cost this country and its economy the last 26 years through crazy policies.

May be tbrozs, Al and the others could give us a reckoning on the 'pubs consistently conservative economic policies. May be it's neo-con economics?

Can we never learn from experience?

Posted by: notthere on April 28, 2006 at 4:14 AM | PERMALINK

I was too young to remember the Reagan years. My guess would be that the deficit spending was more focused on developing our economy. My assumption that deficits should stopped when interest is above historical inflation might be too low, but I think it mostly depends on how the money is spent. At what point does the productivity growth created by a dollar of debt become canceled out by cost of additional interest is the real question that needs answering. How did economic growth rates (nominal) compare to the interest rates during the period? Were we also able to reasonably expect interest rates to fall, further reducing the debt burden relative to growth?

Posted by: aaron on April 28, 2006 at 4:49 AM | PERMALINK

Well, the difference between the state of the national economy and the way people experience it is the same as the difference between temperature and the windchill factor. The thermometer may say it's a nice day in spring with 75 degrees, but you don't feel like putting on a hawaii shirt if there's a nasty wind blowing in your face all the time.

Posted by: Gray on April 28, 2006 at 6:24 AM | PERMALINK

Kevin, seven words explain what Americans are feeling:


You cannot borrow your way to prosperity

Posted by: Stephen Kriz on April 28, 2006 at 6:30 AM | PERMALINK

I think some people are mis-interperating that data. 55% think that the economy is good (that must include a lot of those average hourly rank and file workers). 66% think were on the wrong track, meaning things may be good now, but there's good reason to think that things won't stay that way if we keep doing things the way we are.

Posted by: aaron on April 28, 2006 at 7:00 AM | PERMALINK

How can the economy be doing well when the amount of new unemployment claims filed last week was much higher than anticipated? Not to mention the mean salary of an American household has not changed since the early 90's. Maybe people think the economy is doing well, maybe these same people are not getting all the numbers.

Posted by: Danny Sali on April 28, 2006 at 7:01 AM | PERMALINK

Pretty hard to be upbeat when you see the pond emptying faster than it is being filled. People are waking up and seeing that our entire way of living is unsustainable. But, no leaders are emerging to get us through the coming bottleneck that threatens not just our pocketbooks but the very life of the planet.

Posted by: lou on April 28, 2006 at 7:10 AM | PERMALINK

Stephen Kriz - that's just stupid. Of course you can. People start businesses all the time on borrowed money and become very successful.

Kevin - the economy is doing well - if Greg Mankiw says it's doing well, it's just a fact. But the administration is going in the wrong direction on Iraq, on liberty, on a lot of other things. Thus the contradiction.

Posted by: jb on April 28, 2006 at 7:10 AM | PERMALINK

My guess would be that the deficit spending was more focused on developing our economy.

The Reagan deficits, like the Bush deficits, were created less by changing the mix of spending than by cutting taxes on the rich. So if you consider making wealthy people even wealthier to be "developing our economy", then sure. To some extent, higher defense budgets contributed too. Ultimately, though, the difference between Reagan and Bush is that Reagan was restrained by a (part) Democratic congress and by relatively sane advisers who forced him to stay within the bounds of reality in terms of financing the government and keeping the country running. So when his tax cuts threatened to utterly sink the budget, he instituted some of the biggest tax increases in history to keep the financial house in some vague sense of order. Unfortunately those tax increases kept the less-progressive tax mix in place, so ultimately he mostly shifted the tax burden from the rich onto the poor, rather than actually cutting taxes overall.

Posted by: brooksfoe on April 28, 2006 at 7:17 AM | PERMALINK

People aren't happy with the economy for a reason. Here's an article that explains why Democrats should be promising to Make The American People Richer

Posted by: Linette on April 28, 2006 at 7:19 AM | PERMALINK

People start businesses all the time on borrowed money and become very successful.

The United States is not a startup. When you have a mature business that has ballooning debt and only modest plausible increases in revenue, and that looks set to continue basically forever, then people are going to start selling your stock.

Posted by: brooksfoe on April 28, 2006 at 7:23 AM | PERMALINK

The United States is not a startup. When you have a mature business that has ballooning debt

Posted by: brooksfoe on April 28, 2006 at 7:23 AM | PERMALINK

Analysts look at debt to revenue ratio. For which the debt isn't balooning.

Posted by: McA on April 28, 2006 at 7:46 AM | PERMALINK

Well said Kevin. These years out to be refered to as "The Big Bush Squeeze" for the middle class.

Posted by: Psyberian on April 28, 2006 at 7:48 AM | PERMALINK

Matt said:
Notice that commodity prices are up all around, oil, gold, copper, everything, and this commodity price rise seems correlated with world economic growth, more precisely capital spending.

Since each of the commodities has 'real' value, which doesn't change with it's price, (a gallon of gas in 1965 is the same ((almost) as a gallon of gas in 2006) AND this price rise is in all of the various commodities, couldn't it just be pointed out that the value of the money is declining, rather than, the value of the commodities is rising?

Is there a statistic that indexes all of the various traded commodities (like a stock index)?

Maybe the glass really is half empty and only the blind optimists say it's half full.

Posted by: slanted tom on April 28, 2006 at 8:01 AM | PERMALINK

I'm quite content to see Democrats ride a wave of economic discontent back into power. But I think it's more the lack of a coherent economic policy, rather than deliberate malfeasance that has gotten us to the point. The reason the "good news" isn't resonating is that it doesn't make much sense (unemployment is low, but wages are stagnating; spending is up, but only for a few; housing is worth more, but it's a bubble, etc). That's effective for poltics, but I think the real issue is that there's a lot of free-floating uncertainty, and that is what markets, and people, like least. Things could get demonstrably better or they could get much, much worse. And if Democrats get back into power and then the economy tanks, I'm a little concerned that my party doesn't have a lot of good answers. And frankly, while I don't buy most polling data, I'd check off the "going to get much worse" column if someone asked me.

Posted by: weboy on April 28, 2006 at 8:02 AM | PERMALINK

"And secondly, your insistence that somehow people don't understand how much money they have, how much they owe, how much their healthcare costs, what the balloon on their adjustable mortgage is going to be, unless the media tells them, is pathetic. People don't listen to Fox to know how rich they feel, they look in their checkbooks."

Yeah, and this has those condescending conservative elitists pissed. "Whaddya mean those stupid Main Street Americans won't believe us when we tell them they're eating cake?"

Posted by: chaboard on April 28, 2006 at 8:25 AM | PERMALINK

I'm still waiting for the Democrat solution to America's "malaise".

I'm still waiting for conservative blowhards to learn the difference between a noun and an adjective.

Posted by: Gregory on April 28, 2006 at 8:26 AM | PERMALINK

These numbers don't seem so hard to interpret.

55% of people think that their own personal circumstances are not bad right now. But very many of them believe that their current prosperity is made possible by (i) heavy borrowing from foreign nations, some of whom are not exactly friendly to US interests; (ii) a cheap energy era which they can tangibly see coming to an end with each trip to the gas station, or home heating bill; (iii) cheap foreign labor, which may be helping to give them low consumer prices now, but is inexorably advancing to the point where it will ultimately take away their own jobs, and (iv) an unsustainable government deficit driven by reckless spending and irresponsible tax cuts for those least in need of such cuts.

In a word, while a majority of Americans believe that the system is still delivering reasonably well for them personally, many of them expect decline and collapse in the future.

Ordinary Americans have their own "leading indicators" - the prices on the gas pumps; the balances on their credit card bills; the cost of their groceries; the size of their last raise, and the amount they owed to the government on April 15th.

Posted by: Dan Kervick on April 28, 2006 at 8:28 AM | PERMALINK

I could interpret this data any number of ways. Some of them honest.

Why stop a trend, tbrosz?

Posted by: Gregory on April 28, 2006 at 8:32 AM | PERMALINK

"The average hourly wage for rank-and-file workers... has fallen by 5 CENTS in the last 4 YEARS... after inflation is taken into account."

THE AVG WAGE HAS ONLY INCREASED EQUAL TO INFLATION! WE NEED MORE TAXES AND SOCIAL PROGRAMS!!

Vote Democrat.

Posted by: sportsfan on April 28, 2006 at 8:41 AM | PERMALINK

I think the noun/verb problem is a midwest thing, not a conservative/dem thing. In Michigan we especially have trouble with adjectives and adverbs. I still have a lot of trouble, but my big weakness is puntuation. I can rationalize the use of any punctuation in just about any place. Makes for quite a mess.

Two main things cause this. Grammar is taught very poorly and probably at the wrong ages. Second, no one is exposed to proper usage. The are no good or consistent models to learn from.

Posted by: aaron on April 28, 2006 at 8:43 AM | PERMALINK

Analysts look at debt to revenue ratio. For which the debt isn't balooning.

The national debt is about 9 trillion dollars. The annual budget deficit is about $450 billion. So debt is going up about 5% a year. If the US economy does 3% growth, that's a very good year. So debt is growing at least 50% faster than revenue.

Not "ballooning", perhaps, but definitely headed in the wrong direction.

Posted by: brooksfoe on April 28, 2006 at 8:49 AM | PERMALINK

But interest on that we pay on that debt is smaller than in recent history.

Posted by: aaron on April 28, 2006 at 8:52 AM | PERMALINK

THE AVG WAGE HAS ONLY INCREASED EQUAL TO INFLATION! WE NEED MORE TAXES AND SOCIAL PROGRAMS!!

If the average wage had only increased equal to inflation for the last 50 years, it would be about $15,000 a year.

If want your kids to be poor, vote Republican.

Posted by: brooksfoe on April 28, 2006 at 8:53 AM | PERMALINK

Sorry,

The expense from that debt is smaller than history.

Posted by: aaron on April 28, 2006 at 8:54 AM | PERMALINK

What's the point of a revolution without ...???

Posted by: Jeffrey Davis on April 28, 2006 at 8:55 AM | PERMALINK

All of this, "it's the media's fault" business is garbage.

First of all, the article Kevin links to is hardly bad-mouthing the economy, the headline is "U.S. Economy Still Expanding at Rapid Pace" - not "Bush is Bankrupting the Nation!!"

The majority of people in this country dont read a newspaper, they get their news from TV, and most of those people are watching fox, which never misses an opportunity to present a rosy picture of things.

People who have an unfavorable view of the economy are those in the middle who's income has been stagnate for the last few years & I think they're getting pretty friggin' sick of hearing how great things are when they see that their paycheck isn't even keeping up with the CPI increases year over year.

Posted by: GMF on April 28, 2006 at 8:58 AM | PERMALINK

lou: "Pretty hard to be upbeat when you see the pond emptying faster than it is being filled. People are waking up and seeing that our entire way of living is unsustainable. But, no leaders are emerging to get us through the coming bottleneck that threatens not just our pocketbooks but the very life of the planet."

My $.02 on why people are responding that the country is on the wrong track. Definitely the growing awareness of our unsustainable lifestyles--with resource depletion and climate change the looming reality--is part of it.

An awareness of growing inequality within the US is another. People feel that they are slipping down the status pole. They can't afford health care, their jobs are insecure, they are working more and more just to keep up. Humans feed on social comparison, and a lot of people feel like they are on the losing side. With Republicans, crowing that "government is the problem," have shredded the social contract, and people are feeling adrift and fragmented.

I think we have reached a kind of tipping point on immigration as well--immigrants, legal and illegal--are a visible presence in every day American life. If you believe the numbers, ~10% of the Mexican population is living in the US without legal authorization, and 15% of the US population is foreign born. I think many native born Americans feel as if their worlds have been overwhelmed.

I think Americans are dimly aware and uncomfortable about how our unsustainable life style affects the developing world and affects us. Maybe that is a psychological aftershock of Katrina, Iraq and Darfur and illegal residents: The rest of the world is POOR. At some level, we know that it's not fair and that it is not going to last.

The principal reason for malaise, however, is the utter failure of Republican leadership in Washington. Our president--rather than providing leadership--seems to be determined to make the problems worse.

So I agree 100% with what lou said, and I took five times the number of words to say it.

Posted by: PTate in MN on April 28, 2006 at 9:02 AM | PERMALINK

For which the debt isn't balooning.

If we are running a deficit then the debt is going up and we've been running record deficits for the past couple of years.

Posted by: Stephen on April 28, 2006 at 9:11 AM | PERMALINK

I think the noun/verb [sic] problem is a midwest thing, not a conservative/dem thing.

Gee, and I thought it was a right-wing talk radio thing.

(It's a noun/adjective thing, BTW. Verbs are not adjectives.)

Posted by: shortstop on April 28, 2006 at 9:14 AM | PERMALINK

Its amazing what you can do when you max out the credit card. Throw around a couple of billion dollars on highway projects and war contracts and you can do a lot to help unemployment.

Don't worry, your grandkids won't mind paying for it.

Posted by: Stephen on April 28, 2006 at 9:15 AM | PERMALINK

Want to watch a lefty go mental?

It's easy: just tell him the unemployment rate is 4.7%. Then sit back and watch him froth and spit that the statistics are phony! Phony I tell you!

Next, tell the lefty that the DOW is nearing an all-time high. The Lefty will get a crazed look and mumble about "Well it was higher under Clinton!"

Posted by: Frequency Kenneth on April 28, 2006 at 9:23 AM | PERMALINK

In a word, while a majority of Americans believe that the system is still delivering reasonably well for them personally, many of them expect decline and collapse in the future.

A supporting anecdote. Yesterday I met a guy who had lived in the area (Silicon Valley) for the past 30 years. After we talked about other things for a while, he started going on about the economy. He said that because property taxes don't keep pace with inflation, "I pay $1000 a year and my neighbor pays $8000 a year on identical houses. That's just crazy - it's wrong."

He gets it.

Posted by: Wapiti on April 28, 2006 at 9:29 AM | PERMALINK

Keeping taxes lower on investments is exactly what we want to do. We don't want to tax income, we want to tax consumption. It isn't about giving the rich more to spend, it's about getting them to invest in that risky venture. Lowering taxes impoves the rate of return versus risk.

Reducing taxes on non-investing class persons will only drive up inlation. You increase demand, but not supply. A cool idea would be to lower the non-investment income tax for people who invest so that they can make the transition to investor class (kind of like a 401k or TSP). It would be really neat if we could do this for people who invest their wage income into their own businesses.

Posted by: aaron on April 28, 2006 at 9:46 AM | PERMALINK

The economy is only bad for those who spend their days reading and posting on the moonbat blogs. The rest of the country is working, earning, investing, and paying for this group of losers.

Posted by: BlaBlaBla on April 28, 2006 at 9:51 AM | PERMALINK

"For most of us, trickle-down economics is more like Republican water torture."

Zing. That was a good one Kevin.

Posted by: Nemesis on April 28, 2006 at 10:05 AM | PERMALINK

I guess thats why people like John Kerry who married into money and was viewed as one of the richest presidential candidates in history had such a tough time touching base with the working class. After all what you described in this article is what is thought of when thought of Kennedy, Kerry, etc., etc.
More people employed than ever in history. Home ownership at its highest level ever. Lower taxes.
Labor unions dropping like flies. And you think we are on the wrong track. Now stop and think for a minute why you have become the permanent minority party, with that line of reasoning.

Posted by: mycampaign on April 28, 2006 at 10:08 AM | PERMALINK

Good point, Jason!

I recall US Secretary of Labor Ray Marshall's comment when I asked him about underemployment during his visit to the University of Helsinki. "We don't even want of go there today." Not much has changed in 28 years; U3 still is about the only unemployment figure either the press or politicians want to talk about. Shit job and good job are doubtless subjective notions, but still if a low-skill job pays $8.19 an hour without any benefits and requires a 40-minute commute both ways, how do you think most people would classify it?

Posted by: kostya on April 28, 2006 at 10:14 AM | PERMALINK

All this whining will disappear if these unemployed people just find some jobs, which everyone except the main stream media knows to be plentiful.
Posted by: tbrosz on April 28, 2006 at 2:10 AM | PERMALINK

It's not the unemployed that are the RNC's problem. It's the 3 middle 20% tranches of the population who are seeing their take home pay and net worth decline throught a combination of inflation, rising interest rates and wage stagnation.

Posted by: Nemesis on April 28, 2006 at 10:14 AM | PERMALINK

Posted by: mycampaign on April 28, 2006 at 10:08 AM | PERMALINK

Clap louder or tinkerbell will die, clap louder...

And BTW Americans wont be fooled again. Better a patrician who fights for them, like Kerry, Kennedy and FDR, than a fake southern "Old Boy" who corrupts and destroys everything he touches. No more incompetent asses in the White House.
Hey, not a bad slogan for 2008.

Posted by: Nemesis on April 28, 2006 at 10:21 AM | PERMALINK

This is one of those situations where reporting the variance would be a really good thing. Liberals should support policy that reduces the variance of economic indicators like income. We certainly want growth, but we should much prefer slower growth that improves most people as opposed to rapid growth that increases inequality without making many any better off. Just wait until the economic slowdown comes in the next few months. That'll be fun.

Posted by: Brendon on April 28, 2006 at 10:23 AM | PERMALINK

It isn't about giving the rich more to spend, it's about getting them to invest in that risky venture.

Isn't that reason they are allowed to take deductions for losses ? We let them write their mistakes off and give them breaks when they have successes.


Posted by: Stephen on April 28, 2006 at 10:24 AM | PERMALINK

Don't these trolls look at the polls even once in awhile? These guys take "whistling past the graveyard" to new levels of musicality.

Hint: Trash talk about winning elections carries a lot less weight when your guy is at 32 percent and falling and Karl Rove and several GOP members of Congress are looking at imminent indictment.....

Posted by: Jim J on April 28, 2006 at 10:26 AM | PERMALINK

It's easy: just tell him the unemployment rate is 4.7%.

How many people are employed by the pork in the most expensive highway bill ever ?

Posted by: Stephen on April 28, 2006 at 10:27 AM | PERMALINK

Frequency nailed me!

Posted by: Ken Mehlman on April 28, 2006 at 10:29 AM | PERMALINK

"At what point does the productivity growth created by a dollar of debt become canceled out by cost of additional interest is the real question that needs answering."

Government debt generally gets translated into faster immigration. The reason is that the economy adjusts to rebalance the ratio of government sector to the private sector. This is why Clinton was such a great president, he understood this, as did Hamilton and Lincoln.

Hamilton ran government debt to encourage immigration out west, specifically to encourage immigration. He understood the connection, but we have all gotten progressively stupid about this since the Civil War.

"AND this price rise is in all of the various commodities, couldn't it just be pointed out that the value of the money is declining [because of commodity price rises]"

In the long term, probably. In the short term commodity price rises is not accompanied by wage rises.


"I think we have reached a kind of tipping point on immigration as well--immigrants, legal and illegal--are a visible presence in every day American life. If you believe the numbers, ~10% of the Mexican population is living in the US without legal authorization, and 15% of the US population is foreign born."

Precisely because of the bloated government sector.


------------------------------------

Flat taxes never worked, not ever since Reagan. Progressive taxation always seems to keep government spending in balance, massive migration in check and the trade debt more in balance. Probably we are discovering, finally, that the rich are under taxed relative to the government services they receive.

Our government debt will become a burden when the returns from migrating to the USA are lower than staying put.

Conservatives always miss this but each time they foist the idea of flatter taxes, government grows like a hog and the poductivity gains are soaked up.

Posted by: Matt on April 28, 2006 at 10:30 AM | PERMALINK

Jim J. In case you missed the memo, George W. will never run a race again. As for Graveyard.
The dems had 258 in the house in 1994 and now 204, had control of congress for 40 years and now out for 12, lost the senate the white house. Since re-districting in 2000 in the 2004 election only 5 incumbents either party lost.
I hope this information is not viewed as trash talk. In 2006 Rep win congress, Senate, etc....

Posted by: mycampaign on April 28, 2006 at 10:31 AM | PERMALINK

By any meaningful measure, the Bush presidency is an economic train wreck. Real wages are down, total hours worked are down, productivity is up (but only because total hours worked are down), more people than ever before are without health insurance , the rate of job creation over the past five years is the worst since records have been kept and on and on. The budget and trade deficits, the broadest indicators of economic health, are out of control and that means two things we are borrowing from our children to pay for a war that should never have been fought and to fund tax cuts for wealthy people who didnt need them; and we are increasingly transferring our accumulated wealth to countries like India and China. Given these facts, things like the current unemployment rate are irrelevant.

Tbrozs (fake or real?) implied upthread that jobs are plentiful, which they are, if you want to be a waitress or bartender. However, almost one-fifth of American manufacturing jobs have vanished since Bush became president and those jobs typically paid a living wage and offered health care benefits and 401(k) retirement plans. True - there are a lot of jobs out there flipping burgers at Burger King or waiting tables at Applebees. However, most of these jobs are low-wage, low-benefit jobs. Real jobs, that produce tangible items of lasting value that will sustain this country over the long term, are disappearing. We cant all flip burgers for one another and expect a rosy future.

The right-wing Kool-Aid drinkers can spin this any damn way they want to, but here is the unvarnished truth - We are becoming a poorer nation under this president. Full stop.

What can we do, besides impeaching the incompetent criminals in the White House?

We could start by repealing the Bush tax cuts, pulling out of Iraq immediately and investing in a crash program to become energy independent in ten years, like the one outlined here. These actions would all make much more sense than the current downward spiral we are on currently.

Posted by: Stephen Kriz on April 28, 2006 at 10:31 AM | PERMALINK

And you think we are on the wrong track. Now stop and think for a minute why you have become the permanent minority party, with that line of reasoning.
Posted by: mycampaign

Oh boy daveyo is back!

Posted by: ckelly on April 28, 2006 at 10:40 AM | PERMALINK

"Tbrozs (fake or real?) implied upthread that jobs are plentiful, which they are, if you want to be a waitress or bartender."

This is the trickle up theory. When the American middle class is overburdened by government growth, they get a productivity increase by farming out low wage service jobs to immigrants. The freed up labor at the bottom adds more working capability to the middle class. We just rebuild the economic stratification with immigrant labor and the government sector rebalances.

When we tax the rich fairly, two things happen. The government releases resources, in the form of labor, and the top layers shrink. Hence you get an internal rebalance without relying om immigrant labor.

The government sector shrinks because the apparent cost of goverment increases as taxes on the rich increase, causing less demand for more governemnt.

We want an economy where some poor slob can go out and take a low end job without the worry that government soaks up all the free resources. A lot of us would enjoy, actually, getting out and working some weak ass job, or run the corner gocery store, meeting the neighbors. Wages are less important except you and I know we are wasting our time when we see that half of our grocery customers are earning wages from our property taxes, especially when their earning will go on long after we quit working because of government pensions and insurace.


Posted by: Matt on April 28, 2006 at 10:53 AM | PERMALINK

Amen to every one of you!

High home prices sound good except to the guy who had to pay top price for a place to live that is far away from his work and the price of gas takes off.

Even for me who bought my home 17 years ago the higher valuation does me no good unless I want to borrow money or sell, and I don't want to do either.

Then let's take stocks. Sure most people now own stock, but its tied up in a 401K where we can't spend it, and the value dropped 50% from Bush and has finally regained itself.

I can't spend the 401K and the value may or may not be there in the future when I can.

So the two things I can't spend are increasing in value. Big whippy deal.

In the meantime my wages are stagnant and are not keeping up with the increased cost of gas, healthcare (I pay more every year) and college, the other expense I'm currently paying.

I'm hurting in the pocketbook - in the weekly budget, and I'm sick of media telling me how great somebody else is doing. I know when I've got extra cash and when I don't!

I don't have extra cash and I know I'm still better off than most people.

I want every gas pump in America to have a sign stating the CEO of Exxon got a $400,000,000.00 bonus for the last 3 months because he 'earned' it!

Posted by: Tripp on April 28, 2006 at 11:00 AM | PERMALINK

Despite the periodical hue and cry about the supposedly woeful state of science and engineering education, the sad fact is that the number of tech savy people is much larger than the number of jobs that can adequately use their skills.

So the problem is not just concentrated in the low paying jobs, wherein the rate of real wage increases appears to be zero or negative, but also in middle levels where most people are underemployed. This may be an inevitable result of automation brought about by obvious technological trends, but the current political leadership has proved itself to be so incompetent and clueless and dishonest about everything else that it is very hard to escape the conclusion that the Bushistas are more than slightly responsible for this state of affairs.

Posted by: lib on April 28, 2006 at 11:04 AM | PERMALINK

How about this?

Welfare for everyone. We evenly distribute a percentage of tax revenue to every citizen.

Posted by: aaron on April 28, 2006 at 11:04 AM | PERMALINK

Repubs better hope that their "permanent majority" lasts longer than Dubya's "political capitol".

Posted by: Stephen on April 28, 2006 at 11:05 AM | PERMALINK

Our economic uptick is a house of cards. Too much funny money (ie borrowing) being thrown around for this uptick to last.

When the other shoe drops and all this borrowing comes due, there will be trouble.

You can't blame the average Joe though. He's just emulating Uncle Sam - spend, spend, spend off of borrowed money.

Beijing and Riyadh must be laughing and laughing hard, knowing that they control most of our nation's finances, whether it be US debt from government spending or Fannie Mae bonds.

Posted by: NSA Mole on April 28, 2006 at 11:14 AM | PERMALINK

Insurmountable national debt, GCC, energy costs exploding with no concrete plans for alternatives, a trillion dollar quagmire in Iraq with Iran on deck, health care expenses skyrocketing, a pandemic of some sort probable in next couple decades...

Don't worry, just drink the kool-aid.

Posted by: Michael7843853 G-O in 08! on April 28, 2006 at 11:19 AM | PERMALINK

It's simple, really. Unemployment is low, and inflation is low outside of certain sectors of the economy. So by traditional standards, the economy is doing well.

But wages are stagnant except at the top, and the costs that are rising most rapidly are energy, housing, health care, and college education... which add up to the overwhelming majority of a typical middle class family budget.

If you're a highly paid professional, it's a terrific economy... you're seeing double digit growth. If all you want out of life is to punch a clock 9 to 5 and ride the bus to work, it's a great economy... unemployment has rarely been lower.

But if you're in the middle... your cost of living is rising faster than your income. And no matter how hard tbrosz and the rest of the trickle-down chorus push Americans to look only at one or two traditional economic benchmarks and sing hosannas to the market, people aren't stupid. They know when they're getting shafted.

In all seriousness, though, I hope the Republicans continue to blame the media and insist the economy is great and Iraq is going well, and insult the intelligence of the American public. Let them turn into the elitist "we know better than you" caricatures they've painted liberals to be for all these years.

Keep it up, tbrosz. You guys are going to get creamed at the polls in November.

Posted by: ajl on April 28, 2006 at 11:23 AM | PERMALINK

Stephen:

...almost one-fifth of American manufacturing jobs have vanished since Bush became president

If you go to the BLS site and look up manufacturing employment numbers, you'll see that the decline began in January of 1998, and the real power dive started at the end of 2000. It wasn't about Bush. Guess what? I don't think it was about Clinton, either.

Something else is going on with manufacturing jobs, and it would be great to find out what, but that kind of analysis isn't going to happen around here because everyone is stuck on "Bush sucks."

We could start by repealing the Bush tax cuts, pulling out of Iraq immediately and investing in a crash program to become energy independent in ten years...

Tax increases, bail out of Iraq, and a massive new government program? Have Democrats run on that this fall, and tell me how that goes.

Posted by: tbrosz on April 28, 2006 at 11:24 AM | PERMALINK

The good news is that there is only one idiot left here who appears to make any sense albeit only superficially.

Repubs are so done for.

Posted by: lib on April 28, 2006 at 11:29 AM | PERMALINK

lib, nice going. we don't want anyone else with a different view point to come to our site. Go get em...

Posted by: ckelly on April 28, 2006 at 11:37 AM | PERMALINK

Analysts look at debt to revenue ratio. For which the debt isn't balooning.
Posted by: McA on April 28, 2006 at 7:46 AM | PERMALINK

Problem is, the "revenue" picture is a very narrow slice of reality. The CEO of Exxon is getting that revenue. I'm not. Your analysts are suffering from ivory-towerism, because their golf-buddies take them on trips to Scotland. I'd happily take an analyst on a trip to Scotland for some golf. Just to show him the side of the revenue picture he's missing. Unfortunately, without that revenue, I can't.

Posted by: osama_been_forgotten on April 28, 2006 at 11:37 AM | PERMALINK

'Tax increases, bail out of Iraq, and a massive new government program? Have Democrats run on that this fall, and tell me how that goes.'
--tbrosz

(1) It isn't a "tax increase". It's restoring tax rates to where what the government takes in is equal to what it lays out, which is what Clinton's legacy was. We had a budget SURPLUS under him, you'll recall. (2) We shouldn't have been Iraq in the 1st place. There are no WMDs, we have Saddam in custody. Ta Ta. (3) How is a massive government program to become energy independent worse than a massive government program to kill Iraq's, a/k/a the American military? One produces lasting tangible benefits to America and the other doesn't. I'd run on that any day of the week.

Republicans can only win elections by lying, cheating and keeping the American people living in fear. My sense is that the American people want truth, peace and a vision for the future that doesn't involve death and killing. The Republican Party has none of those any more.

Don't be so damn smug about your positions. The American people may be smarter than the GOP gives them credit for.

Posted by: Stephen Kriz on April 28, 2006 at 11:43 AM | PERMALINK

tbrosz, you'd do well to read ajl's post at 11:23 a.m. And then read it again. And then one more time.

Posted by: shortstop on April 28, 2006 at 11:48 AM | PERMALINK

But wages are stagnant except at the top, and the costs that are rising most rapidly are energy, housing, health care, and college education... which add up to the overwhelming majority of a typical middle class family budget.

Exacto-mundo.

And you know what? I used to think I was one of those 'highly paid professionals' that are doing fine, but no more. My highly paid profession is moving to India. Computer programs are being written in India and tested in China.

Posted by: Tripp on April 28, 2006 at 11:49 AM | PERMALINK

lib, nice going. we don't want anyone else with a different view point to come to our site. Go get em...
Posted by: ckelly

Alright! I've been parodied. I've hit the big time. Woo Hoo! I'd like to thank the Academy, my Mom & Dad, and all the little trollies out there.

But I really wanted to say "Frequency nailed it". Maybe next time.


Posted by: ckelly on April 28, 2006 at 11:52 AM | PERMALINK

Truly a fabulous post ajl. I chuckle when the talking heads insist that the economy is so great and John Q. Public should be so happy. Though I've lost faith in the electorate in the past, they aren't stupid.

Posted by: ckelly on April 28, 2006 at 11:58 AM | PERMALINK

ckelly, I did think that was a weird thing for you to say. But last night Don P's impersonation of me had me murdering the VP, so it's all part of the game, I guess.

Posted by: shortstop on April 28, 2006 at 11:58 AM | PERMALINK

We are in the midst of an Inflation/Debt driven economy. Inflated housing prices are creating artificial 'wealth' that is being pumped back into the economy.

Toss another trillion or so on war spending (borrowed money) into the mix and things look nice and rosy... until the proverbial chicken comes home to roost.

Of course, one must realize that the govt is already 'cooking the books' to make things look better... the 'real reality' of our economic situationis worse than things (currently) appear.

Posted by: Buford on April 28, 2006 at 11:58 AM | PERMALINK

. . .and I was going to get a job working the drive through at McDonald's, but it turns out they want to route those calls through a remote call center.

Yup. Outsource the drive-through order taking.

Currently the pilot program is going to North Dakota (with the lowest minimum wage in the country) but you just know where the orders will eventually be going.

Posted by: Tripp on April 28, 2006 at 11:58 AM | PERMALINK

Wasn't there a scifi book that predicted in the future the only jobs in America would be cutting hair and prostitution, because everything else would be automated or outsourced?

And here I never learned to cut hair. Looks like I'm SOL!

Posted by: Tripp on April 28, 2006 at 12:02 PM | PERMALINK

ckelly: I chuckle when the talking heads insist that the economy is so great and John Q. Public should be so happy. Though I've lost faith in the electorate in the past, they aren't stupid.

I think we've had more than enough evidence the past five years that half the electorate will swallow any load of horse doo if they think it's not costing them anything. But pinch their pocketbooks this hard, and they do wake up swinging.

Tripp: Currently the pilot program is going to North Dakota (with the lowest minimum wage in the country) but you just know where the orders will eventually be going.

DAMN funny!

Posted by: shortstop on April 28, 2006 at 12:02 PM | PERMALINK

Kevin,

I really want to help you out on this.

1. The average hourly wage is suppressed by the high influx of illegal immigrant workers - something conservatives are against.

2. The feeling of pessimism in the country is due to a overwhelmingly liberal press which irrespective of the true statistics seeks to downgrade the economic news when a Republican is in office - something conservatives are against.

If you wish to counteract these things you can do your part by not working for a liberal magazine and by voting for conservatives. Simple solution.

I hope this helps.

Posted by: John Hansen on April 28, 2006 at 12:03 PM | PERMALINK

Nick, when you're squeaking by on a low hourly wage, a 0.29% decrease is, in fact, a big deal. Especially when the price of everything from gas to groceries is increasing at the same time. If you're making $300 a week and have $25 disposable income a month, but the price of groceries alone has increased by $10, how do you take care of those "little things" that pop up?ANY change in that balance can be financially disastrous and would most certainly effect one's mood.

Posted by: EM on April 28, 2006 at 12:06 PM | PERMALINK

Central banks in Europe, the U.S. and Japan have been tightening rates. This past quarter economic growth of 4.5% is higher than a sustainable 3%. Japan, in particular, had been inflating with interest rates near zero, and this has stopped. Asset prices have risen too fast to sustain, and another round of belt tightening will see a significant sell off.

China continues to increase productivity in the face of rising commodity prices, but they could be reaching a limit. With per capita oil use about 10% of ours, they will have to see that increase rapidly to get additional productivity.

If the economy grows to fast, high long term interest rates, due to resource constraints, will cause asset sell off, like me, I am selling my house at the peak of the market.

Modern Republicans always grow government, modern Democrats always shrink it. Actually, this is the classic pattern we are returning to.

Because of the Republican government growth, the private sector has little room to maneuver and we end up with short term growth spurts and short term contractions, nothing ever settles and it is up to the Fed to keep things balanced, but they have less and less room to maneuver.

The best case scenario would be another round of belt tightening, a raise in the upper income tax rate, a slow down and rationalization of the Chinese economy, and a small but corrective downturn just in time for the election.

To tell you haw precarious things are, even Hillary looks good. When a small government libertarian likes Hillary, then you know something has gone wrong.

Posted by: Matt on April 28, 2006 at 12:06 PM | PERMALINK

Jim J. In case you missed the memo, George W. will never run a race again.

Sigh. daveyo (aka mycampaign), don't you ever get tired of feeding us this hidebound talking point?

But let me guess - Bush won 80% of the counties in America, right?

Posted by: Alek Hidell on April 28, 2006 at 12:09 PM | PERMALINK

I have to say, and I'm not being sarcastic, that I'm really glad John Hansen posts here. He's a textbook case of a certain kind of lifelong Republican's steely determination to avoid reconsidering any of his cherished misconceptions. Jobs, healthcare, education, human sexuality--the topic doesn't matter; people here politely and patiently present the facts to him and he literally sticks his fingers in his ears and sings loudly.

He's not motivated by malice and spite, so he's not like the trolletariat here. But he is consumed by fear of changing paradigms. We can learn a lot from this fellow about how this kind of voters minds' work...not all of them are as immune as John is to reason, but you have to figure out which ones are salvageable and which ones are a wash.

Posted by: shortstop on April 28, 2006 at 12:16 PM | PERMALINK

Two observations:

Stagnant real wages don't account for bad economic poll and right-track numbers. Iraq and gas prices do. Nothing correlates with Presidential job approval more than gas prices. When they go up, personal spending drops on other items, consumer products makers see inventories rise, they make big layoffs, unemployment rises, recession comes - all while prices keep going up because gas is a commodity. Stagflation. That's why gas prices are so important, and outweigh every other economic indicator. Oh, and they're posted on every major street corner.

The second point is about deficits. Americans don't care about deficits unless they think the government is failing. They didn't care about deficits in the 1980s, and they didn't care in the early 2000s. But they did in 1992, and they will now.

Posted by: Elrod on April 28, 2006 at 12:16 PM | PERMALINK

If you go to the BLS site and look up manufacturing employment numbers, you'll see that the decline began in January of 1998, and the real power dive started at the end of 2000. It wasn't about Bush. Guess what? I don't think it was about Clinton, either.

That's not even remotely true. It was and is about Bush to the extent that he has not exercised the leadership to address the issue with a comprehensive policy. Whether or not a president inherits an issue it's his or her job to address it. If the pressing issues of our time are not Bush's challenge to address, whose are they?

Even worse, Bush has celebrated the bleeding of manufacturing jobs out of the economy as just another one of the blessings of globalism, reassuring us that somehow we'll all be better off for losing these jobs in the future. And of couse he's done the same thing recently with the low paying jobs that have gone to immigrants.

So not only is he guilty of not taking responsibility for this issue, he's doubly at fault for cheering it on as a way to avoid addressing it.

Posted by: Windhorse on April 28, 2006 at 12:17 PM | PERMALINK

Of course I want to talk to people with different and opposing points of view.

But I see no purpose in considering hackneyed viewpoints coming from those whose main objective is to defend the Bushistas at all costs no matter what the facts.

Let us face it. All the conservatives who post here are Bushlickers.

I say good riddance to them.

Posted by: lib on April 28, 2006 at 12:18 PM | PERMALINK

John Hansen,

when a Republican is in office - something conservatives are against.

As they should be. Borrow and spend and big government are not usually something true conservatives support.

But I get your point.

Once a person believes the basic 'distrust the media' premise you can get them to believe almost anything else.

The problem this time is that people are looking at their personal paychecks, bank balances, and bills. It is pretty hard to get people to disbelieve those things.

But carry on you lovable nut! Their must be a raisin in that turd *somewhere*.

Posted by: Tripp on April 28, 2006 at 12:22 PM | PERMALINK

...when a Republican is in office - something conservatives are against.

I'm against Republicans in office also.

Posted by: ckelly on April 28, 2006 at 12:25 PM | PERMALINK

shortstop:

Yeah, I read it.

But wages are stagnant except at the top, and the costs that are rising most rapidly are energy, housing, health care, and college education... which add up to the overwhelming majority of a typical middle class family budget.

The problem here is that nobody is really looking at root causes of economic shifts. I threw out a broad clue with the manufacturing jobs, and nobody cared. Try to THINK for a change. There are changes in the world's economic layout that go far beyond who is president at any given time.

What would a Democratic president be doing? Raising taxes? Putting tariffs on imports? Making outsourcing illegal? Is pricing U.S. products off the top of the scale going to help things? This isn't as easy as "Bush sucks," is it?

Jobs as an issue? Hell, I'll throw the Democratic Party some free advice:

Forget new taxes, unless it's about tax reform. Although liberals will never believe it, killing and eating the rich isn't going to create any middle-class jobs, just like kneecapping Exxon isn't going to put cheap gas in your car.

Which reminds me: Don't run for office on energy costs. It won't take long to show who has been largely responsible for squashing nuclear power, domestic fuel exploration and refinement, and pretty much every method of dealing with the supply end of the equation.

One issue that does have some potential for Democrats, as Kevin has often tried to hammer home, is single-payer health care (private providers paid from taxpayer funds). Selling points:

- Has at least the potential to reduce health care costs for businesses, although nobody has shown me any hard numbers on taxes/insurance costs trade-offs. (business taxes should be the primary source for funds at the beginning to reduce the impact on money flow). There would be other important caveats.

- Would increase employee mobility, with the same kind of positive results that lower capital gains taxes have on the mobility of capital. This is a very big deal, and I don't think it gets much play.

- Would take a large load off of lower-income people.

Bingo. Jobs and votes! Union guys and managers cheering! What's not to like?

Now, I personally don't think it will work out well in the long run, for a number of reasons. There will be strings attached to those government payments, and someday those strings will become anchor chains. They always do (see also: education). But that's another story.

I also don't think the Democrats can carry it off anyway. The temptation to focus on demonizing the existing system instead of showing how everyone might succeed will be too much.

Posted by: tbrosz on April 28, 2006 at 12:29 PM | PERMALINK

It's good to look at the details:
http://bea.gov/bea/dn/nipaweb/TableView.asp?SelectedTable=36&FirstYear=2004&LastYear=2006&Freq=Qtr

Of the 4.8 percentage point increase, Federal spending, Food, and Medical Care accounted for 1.8 percentage points. Take those three out, and you'd be left with 3.0% growth.

Posted by: BB on April 28, 2006 at 12:30 PM | PERMALINK

before someone mentions the deficit-to-GDP ratio, I would like to point out that ~40% of our present GDP, $3T, is smoke & mirrors -- hedonic adjustments and imputed rents, not actual production.

The National Debt:

09/30/2005 $7,932,709,661,723.50
09/30/2004 $7,379,052,696,330.32
09/30/2003 $6,783,231,062,743.62
09/30/2002 $6,228,235,965,597.16
09/28/2001 $5,807,463,412,200.06

We're running SSTF surpluses to allegedly pre-fund the baby boomer's retirement costs, but as we all know now this decade we're spending that too.

Plus how to pay the medicare tab is going to be interesting.

One thing I don't see mentioned is how real estate prices, given that they are basically created on an open, bid-driven market, and such a large part of all of our budgets, are plastic in the sense that they automatically suck up any excess cash in the system. So Bush tax cuts --> higher real estate prices; falling gas prices --> higher real estate prices; etc.

But once other prices rise again, the pain begins.

Posted by: Troy on April 28, 2006 at 12:34 PM | PERMALINK

shortstop:

Thanks for the compliment?. I like posting here because there are a few people like Stephan, Bob, cmdicely, brooksfoe who do a reasonable job at presenting cogent reasons for liberal positions. My goal is not so much to try to persuade as much as to understand the thinking that leads intelligent people to positions that are contrary to my own.

Unlike, some (perhaps even a majority ) of the people that post here, I do not hold to the juvenile opinion that people who disagree with me are stupid. I acknowledge that given the difficulty of the gathering accurate information - and the even harder exercise of assigning correct causes and correlation to data - it is hard to assess which of the competing philosophies gives the best solution for the best amount of people.

Most of the liberal arguments I receive back are based on studies and statistics. The problem is not that I close my mind to the conclusions of these studies. Its just that I know enough math, have enough understanding about how difficult it is to actually determine what is causation and what is correlation,
and have seen enough studies whose initial logical predictions blow up in the face of real future events - to invest my belief in most of them. Its not a problem of information, its a problem of credibility. I hope this helps to understand where I am coming from.

Posted by: John Hansen on April 28, 2006 at 12:37 PM | PERMALINK

I had a really good professor in college - ex Army G.I. bill guy - he used to say (regarding "trickle down economics") that the only thing that trickled down was piss. It was both funny and right, and it still is.

Posted by: afinta on April 28, 2006 at 12:41 PM | PERMALINK
The problem here is that nobody is really looking at root causes of economic shifts.No, the problem is that you're an idiot.
I threw out a broad clue with the manufacturing jobs, and nobody cared.

Nobody cares about most of what you say because its facile nonsense.

Try to THINK for a change.

Physician, heal thyself.

There are changes in the world's economic layout that go far beyond who is president at any given time.

While that's a true broad generality, it doesn't explain the broad decline in income across most segments of the US economy since Bush became president, nor the fact that that is especially concentrated at the bottom. And to the extent that changes that cross Presidencies are involved, they are connected to clear policy choices to which there are clear alternatives.

What would a Democratic president be doing? Raising taxes?

Quite possibly raising some taxes, perhaps while reducing others, to reverse the distributional effects of the tax cuts of the Bush presidency that have been particularly capital-friendly and favorable to the top.

Putting tariffs on imports?

Possibly reversing the unbalanced free trade approach in favor of a fair trade approach that would involve common standards, using the value of access to the US market as a lever to get trade on terms that are beneficial not just to US capital interests.

Making outsourcing illegal?

Neither outsourcing, nor what you are likely actually talking about (offshoring) needs to be made illegal, in an appropriate (fair) trade regime. Nor is it really practical to regulate in any sense.

Is pricing U.S. products off the top of the scale going to help things?

Is this a giant strawman?

This isn't as easy as "Bush sucks," is it?

Well, no, actual policy is somewhat harder than saying "Bush sucks", and even harder than waving around poorly thought out generalities and questions. But its not impractical, either, much as you would like to make it out to be.

Jobs as an issue? Hell, I'll throw the Democratic Party some free advice:

Tbrosz, free advice from you is worth less than is paid for it. Certainly so on matters of policy.

Forget new taxes, unless it's about tax reform.

Since any change to tax law is "tax reform" (whether its the right reform or not may be debatable), this is among the stupidest things any human being has ever uttered. Which, really, doesn't make it atypical for you.

Although liberals will never believe it, killing and eating the rich isn't going to create any middle-class jobs,

Well, that's a pretty big strawman, but sure it will. In the Department of Slaughtering the Wealthy, for one thing.

just like kneecapping Exxon isn't going to put cheap gas in your car.

Nothing is going to put cheap gas in your car. Gas is inherently expensive and getting moreso each day. Now, some of those costs can be deferred or obscured, but that's beside the point.

Reining in oil companies in some respects may be helpful to internalize various externalities that obscure costs and result in inefficiencies, though, and can avoid the enormous crisis that's going to hit when prices rise more precipitously if the infrastructure and economy remain as dependent on oil as they are now.

Posted by: cmdicely on April 28, 2006 at 12:56 PM | PERMALINK

Increased wages for the working (wo)man happen only after a period of 'full employment'. But full employment doesn't mean what it once did - full AMERICAN employment. Today it means the full engagement of employable people all over the world. That's "bad" for Americans who think short-term, but good for everyone in the long term.

Once workers become a scarce commodity, wages for the scarecest rise first. (Technical workers are almost always short of demand these days, so they are well-compensated already.) China itself is beginning to outsource, so we may be nearing some magic full-employment mark, at which point certain (non-technical) wages rise.

Of course, with this comes inflation. When 'everyone's' wages rise, costs rise. When costs rise, prices tend to rise. Be careful what you wish for here.

Regarding the pay of many corporate execs: No argument that thieves inhabit many if not most of the corridors of power. And let's not forget the overpaid leaders of many 'nonprofit' and 'arts' organizations. Boards of directors don't keep these guys in check, there are lots of foxes watching henhouses. Warren Buffet has said it for years, as have other less-famous investors. Unfortunately, it's probably a reality of life that greed drives people to great lengths, whether its justifying slavery or cigarettes. Blaming Bush (or any president) for this is merely a demonstration of one's own ignorance. Judging from boards like this one, there's plenty of ignorance to go around.

Posted by: Mister Snitch! on April 28, 2006 at 1:06 PM | PERMALINK

There seems to be a common thread to many opinions here - never blame Bush for anything because he's never responsible for, nor can do anything about, bad things.

I wonder what drives people to be so obsequious?

Posted by: BB on April 28, 2006 at 1:09 PM | PERMALINK

There seems to be a common thread to many opinions here - never blame Bush for anything because he's never responsible for, nor can do anything about, bad things.

And the corollary is "how can we be expected to get anything done -- we only have the White House, both houses of Congress and the Supreme Court."

Posted by: Jim J on April 28, 2006 at 1:30 PM | PERMALINK

tbrosz: If you go to the BLS site and look up manufacturing employment numbers, you'll see that the decline began in January of 1998, and the real power dive started at the end of 2000.

In other words it closely follows the trade (current account) deficit. That shouldn't come as a suprise, but I admit that I've never drawn people's attention to the correlation. Thanks for the idea.

It wasn't about Bush. Guess what? I don't think it was about Clinton, either.

No, it's about both of them. Admittedly it started with the Asian crisis, which wasn't the fault of US policy, but both Clinton and Bush failed to do anything about it. What's more, Clinton did things to make it worse. Pushing PNTR and WTO membership for China years before they had anything approaching a market economy was one. Bob Rubin's strong dollar policy was another. Bush has vastly increased the federal budget deficit, which tends to increase the current account deficit (China is financing our government).

And that Asian crisis, how did that start? Oh yeah, the Thai baht crashed when their current account deficit hit 7%/GDP and everybody started pulling their money out. BTW, the US 2005 current account deficit was 6.4%/GDP and may hit 7% this year. Being the US we may have more leeway, but we're clearly skating on thin ice.

In the meantime we're going into debt to numerous foreign countries (China, etc.), losing manufacturing jobs, and manufacturing capacity. That last one is bad. Back in the 1980's Reagan finally got serious when we hit 4%/GDP. That's still too far, but at least we had unused industrial capacity we could crank up. It worked (CAD fell to 0.5% by 1989). Nowadays factories are being shipped whole to China, so we don't have the reserve capacity to fall back on.

Something else is going on with manufacturing jobs, and it would be great to find out what, but that kind of analysis isn't going to happen around here because everyone is stuck on "Bush sucks."

Oh? See above.

Posted by: alex on April 28, 2006 at 1:31 PM | PERMALINK
There seems to be a common thread to many opinions here - never blame Bush for anything because he's never responsible for, nor can do anything about, bad things.

Or, more succinctly, "Never blame Bush, he's completely ineffectual".

Posted by: cmdicely on April 28, 2006 at 1:34 PM | PERMALINK

Mister Snitch!: Once workers become a scarce commodity, wages for the scarecest rise first. (Technical workers are almost always short of demand these days, so they are well-compensated already.)

How do you figure that there's a shortage of technical workers? Programmers, engineers, etc. have a higher unemployment rate than the average, let alone the average for people with college or graduate educations. The BLS also predicts that the number of jobs in these fields will grow more slowly than the job market as a whole.

China itself is beginning to outsource, so we may be nearing some magic full-employment mark

Right. They're trying to bring 25M people a year into their workforce. Right now they've got a reserve of about 900M people in the countryside that want real jobs.

Of course, with this comes inflation. When 'everyone's' wages rise, costs rise. When costs rise, prices tend to rise.

No, labor prices cause inflation only if they rise faster than productivity. For years they've been rising slower than productivity.

Posted by: alex on April 28, 2006 at 1:42 PM | PERMALINK

losing 5 cents an hour after adjusting for inflation is like republican water torture?

No stupid exagerations here!

Posted by: sunbeltjerry on April 28, 2006 at 1:47 PM | PERMALINK

Try to THINK for a change.

*Note to all:

When tbrosz uses the word "think" what he means is,

ADOPT MY PRECONCEPTIONS, NOW

To be fair, this is understandable since tbrosz's preconceived ideas are as close to 'thinking' as he ever gets.

As Captain Beefheart once said, "A carrot is as close as a Rabbit ever gets to a diamond."

Posted by: obscure on April 28, 2006 at 2:06 PM | PERMALINK

He's not motivated by malice and spite, so he's not like the trolletariat here. But he is consumed by fear of changing paradigms. We can learn a lot from this fellow about how this kind of voters minds' work...not all of them are as immune as [name omitted] is to reason, but you have to figure out which ones are salvageable and which ones are a wash.

You could write this about the liberals who post here, and it would be as accurate. This is a place where, if you point out that the cost of oil is caused by increased worldwide demand, and that the tax take on gasoline is greater than oil company profits, liberals still blame the companies and want to punish them and their executives, break up big companies, and increase taxes yet more. That $400M to the chief executive of ExxonMobil is annoying, but it isn't a big part of the cost of gasoline.

The average inflation rate is not equally accurate a reflection of the increased cost of living in all segments of society; at the low end, where wages are stagnant, lots of products have decreased in cost over the years, so people can buy more with their earnings (e.g., boom boxes, computers [remember, we are writing about the "bottom 80%"]), and they are not $0.05 per hour poorer. For most people with equity in their homes, or who own rental property, the increases in housing costs are increases in wealth.

But there is no mystery to the "headed in the wrong direction" -- high and increasing fuel prices, near stalemate in Iraq (or else slow progress), increasing deficit and trade impalance.

Posted by: republicrat on April 28, 2006 at 4:13 PM | PERMALINK

Props to shortstop, ajl, obscure, cmdicely, et al for so nicely skewering, slicing and dicing tbrosz' nonsense in this thread.

I've always said that tbrosz is capable of debating honestly, but that to his shame he most often chooses not to. Here, perhaps, we see why: He's as poor a debater in his tweedy reasonable guise as he is in full-bore dishonest Bush apologist mode. An amazing feat, really.

Posted by: Gregory on April 28, 2006 at 4:25 PM | PERMALINK

For Republican'ts, wages going down IS a good economy.

No self-respecting Republican't earns WAGES, for Chrissakes.

Posted by: Cal Gal on April 28, 2006 at 4:51 PM | PERMALINK

the cost of oil is caused by increased worldwide demand

And we make up 25% of that demand and do nothing to decrease it. We also feed the heated economies of China and India, driving up their demand. We also start wars in the Middle East, mess with Venezuela, and our buddies in Russia nationalize Yukos. Anyone who confuses this with "market forces" is either a liar or naive.

and that the tax take on gasoline is greater than oil company profits

Kind of meaningless, if true, since one would hope the taxes on the fuel outweigh oil company profits. And not really relevant, since what matters is the extra amount of money Americans are spending on gasoline relative to before Bush took office, and where the bulk of that extra money is going. A good chunk of those windfalls are going to our "good friends" who fund terrorists.

That $400M to the chief executive of ExxonMobil is annoying, but it isn't a big part of the cost of gasoline.

It's $4 for every household in the country going to one person. Would we all be so "blessed" that the economy is made to funnel that kind of money to us by specific policies set forth by people that Exxon props up.

Posted by: BB on April 28, 2006 at 5:14 PM | PERMALINK

republicrat,

I suppose y'all mean me when you mention skewering the Exxon CEO and his $400,000,000.00 windfall.

That's the only smidget of truth in your whole strawman post.

What has got my panties in a wad is the stupidity of all of this. The short-sightedness. The faux-religiousity taking over reason. The selfishness. The greed.

Sheesh.

Perhaps hell is seeing bad things coming and being helpless to stop them.

Posted by: Tripp on April 28, 2006 at 5:15 PM | PERMALINK

Perhaps hell is seeing bad things coming and being helpless to stop them.

Actually, scientists recently discovered that Hell exists. It's a stuck elevator with Ann Coulter and Sean Hannity in it. Hell Plus is the same thing, except they're naked.

Posted by: BB on April 28, 2006 at 5:25 PM | PERMALINK

Hell Plus is the same thing, except they're naked.

Omigod.

That's where we're all going...

Posted by: obscure on April 28, 2006 at 5:41 PM | PERMALINK

Alex:

Thanks. Nice to get at least one reasonable response. I hadn't noticed the similarity of the manufacturing jobs curve to the trade deficit curve, but which is cause and which is effect? The obvious answer is that losing manufacturing would tend to drive the trade deficit in goods, but that's just an assumption.

Still doesn't explain why the job loss occurred at that particular point. Are you saying the 1997 Asian crisis precipitated the loss of U.S. manufacturing jobs to that extent? I don't quite see the mechanism there.

Posted by: tbrosz on April 28, 2006 at 6:37 PM | PERMALINK

tbrosz: I hadn't noticed the similarity of the manufacturing jobs curve to the trade deficit curve

I hadn't either, until you mentioned the BLS data and that manufacturing employment started to nose dive in Jan 1998.

which is cause and which is effect?

Correlation between the curves doesn't show it, but I think you can infer that the trade deficit caused the loss of mfg jobs. I doubt that they fired people or closed up US factories in order to cause a trade deficit.

During the Asian crisis the value of most East Asian currencies dropped sharply, making their exports cheaper. Also, investors lost confidence in East Asia and moved their money to the US. That caused a big US capital account surplus which, pretty much by definition, implies a trade deficit (foreigners investing dollars in the US leaves fewer dollars they can spend on US exports).

The Asian crisis was over in a few years, but we've kept on going. China is the biggie now, and Clinton's premature push for PNTR (US Permanent Normal Trade Relations) and WTO membership for China really helped that.

The Chinese gov't spends an amazing 10% of the country's GDP buying up dollars (10% is like us spending 1.2T/yr). Otherwise the reduced foreign demand for dollars would cause the dollar to fall until our trade was more in balance.

Why does China do this? One theory is that they're on a treadmill and can't get off. Unless the economy keeps growing quickly there will be a lot of unrest, so they're basically willing to loan us the money to buy their goods.

Whatever their reason, it's a drug to us. We just keep borrowing, and it can't go on forever. If it crashes, instead of undergoing a controlled change, it'll be seriously bad news (the Asian crisis started when this happened to Thailand).

Reagan did something about this (negotiated with Japan to gradually sell dollars) back in 1985 when the trade deficit was 4%/GDP. It worked fine. Now the trade deficit is 6.4% and rising, but I don't see anything being done.

Posted by: alex on April 28, 2006 at 7:57 PM | PERMALINK

Nice to get at least one reasonable response.

If nothing else, you have to admite tbrosz' utter lack of shame.

tbrosz, unfettered contempt is the only reasonable response to your constant stream of intellectual dishonesty, straw man arguments, and other assorted bullshit.

Posted by: Gregory on April 28, 2006 at 7:59 PM | PERMALINK

Correlation between the curves doesn't show it, but I think you can infer that the trade deficit caused the loss of mfg jobs. I doubt that they fired people or closed up US factories in order to cause a trade deficit.

This paper (I haven't waded through the technical parts) seems to support your position.

Posted by: tbrosz on April 28, 2006 at 9:05 PM | PERMALINK

tbrosz: This paper (I haven't waded through the technical parts) seems to support your position.

Another good link, thanks. Of course if you keep linking to EPI, I'll have to link to Cato or something. Seriously, while EPI leans left, they're economic arguments are usually solid, regardless of whether you agree with them.

I didn't realize that the trade deficit accounts for so much of the loss of mfg jobs, or that demand in recent years hasn't shifted away from manufactured goods. I used to hesitate to use the jobs argument because some of it is due to increased productivity.

I'd think any candidate, D or R, could get a lot of honest mileage out of this issue. It's about both fiscal responsibility (unsustainable trade deficit) and jobs. Why don't we hear more of this?

BTW, folks like Martin Feldstein (former head of Bush's Council of Economic Advisers) are starting to use terms like "competitive dollar" to describe what has to happen.

Posted by: alex on April 28, 2006 at 9:54 PM | PERMALINK

alex:

I think attrition of low-level manufacturing jobs in the U.S. and other Western nations would have been an inevitable trend, between automation and low-cost overseas labor. Farming went through a similar reduction over the past century. I was just surprised at that rapid drop-off.

Posted by: tbrosz on April 29, 2006 at 1:08 AM | PERMALINK

I'm looking over expenditure data from the BLS (2001 and 2003) and it's pretty interesting.

While income may have remained flat, so have expenditures for all but the top earners.

Unfortunately it's in pdf, so it would be a pain in the ass for me to manipulate the data.

Some interesting points:

Transportation expenditures have declined for all but the top 40% earners (they spend more money on new cars as status symbols).

Health care expenditures have gone up significantly, but again only for the top 40% (Have health care cost gone up for basic services, or are mostly spending more on the latest and greatest?)

All groups saw significant increases in entertainment expenditures.

All groups had a decline in spending on reading (just thought that was interesting).

Increases in tobacco and smoking spending in the lower end and decreases in the high end.

Decline in alcohol spending for lower 60%, big increase for the top 40%.

Food expenses have remained flat for all groups (slight decline).

This data doesn't answer, but it raises the question, "Has inflation affected the lower income as much, or is it more targeted to the upper income earners?"

Higher earners are getting older, lower are staying the same age (retire already!)

Posted by: aaron on April 29, 2006 at 8:15 AM | PERMALINK

Notice the Gallos on this list. I told y'all 'bout a year ago that it was common knowledge in the tax community that they were a huge factor in the phony baloney 'grass roots' efforts to repeal the estate tax and shelter a billion dollar business which receives generous subsidies and tax advantages.
*****
Public Citizen and United for a Fair Economy Expose Stealth Campaign of Super-Wealthy to Repeal Federal Estate Tax
Report Identifies 18 Families Behind Multimillion-Dollar
Deceptive Lobbying Campaign
http://www.faireconomy.org/press/2006/pc_and_ufe_expose_campaign.html

WASHINGTON, D.C. The multimillion-dollar lobbying effort to repeal the federal estate tax has been aggressively led by 18 super-wealthy families, according to a report released today by Public Citizen and United for a Fair Economy at a press conference in Washington, D.C. The report details for the first time the vast money, influence and deceptive marketing techniques behind the rhetoric in the campaign to repeal the tax.

It reveals how 18 families worth a total of $185.5 billion have financed and coordinated a 10-year effort to repeal the estate tax, a move that would collectively net them a windfall of $71.6 billion.

The report, available at www.faireconomy.org/reports/2006/EstateTaxFinal.pdf, profiles the families and their businesses, which include the families behind Wal-Mart, Gallo wine, Campbells soup, and Mars Inc., maker of M&Ms. Collectively, the list includes the first- and third-largest privately held companies in the United States, the richest family in Alabama and the worlds largest retailer.

These families have sought to keep their activities anonymous by using associations to represent them and by forming a massive coalition of business and trade associations dedicated to pushing for estate tax repeal. The report details the groups they have hidden behind the trade associations they have used, the lobbyists they have hired, and the anti-estate tax political action committees, 527s and organizations to which they have donated heavily.

In a massive public relations campaign, the families have also misled the country by giving the mistaken impression that the estate tax affects most Americans. In particular, they have used small businesses and family farms as poster children for repeal, saying that the estate tax destroys both of these groups. But just more than one-fourth of one percent of all estates will owe any estate taxes in 2006. And the American Farm Bureau, a member of the anti-estate tax coalition, was unable when asked by The New York Times to cite a single example of a family being forced to sell its farm because of estate tax liability.

This report exposes one of the biggest con jobs in recent history, said Joan Claybrook, president of Public Citizen. This long-running, secretive campaign funded by some of the countrys wealthiest families has relied on deception to bamboozle the public not only about who must pay the estate tax, but about how repealing it will affect the country.

Said Lee Farris, senior organizer for estate tax policy at UFE, Its time for the majority of Americans who support the estate tax to speak out, and not let a handful of wealthy families sway Congress to twist the tax laws for their own benefit. Polls now show that most Americans support this tax and the revenue it yields to pay for vital services, especially given our nations huge deficit.

While they extol the hard work of individual farmers and small businesses, most of the 18 families have been wealthy for generations; only five still include the people who first earned the family fortune. Members of the families are far less likely than most Americans to have paid taxes on their wealth; to a large extent, that wealth lies in assets that have appreciated but, unlike paychecks, have never been taxed.

These super-rich families have spent millions in personal wealth and used their companies resources and lobbying power in repeated attempts to influence members of Congress to repeal the tax. They have financed groups who have launched multimillion-dollar attack ads against Republican and Democratic senators alike, including former Senate Minority Leader Tom Daschle (D-S.D.) and Sens. Max Baucus (D-Mont.), Olympia Snow (R-Maine), Blanche Lincoln (D-Ark.), Mark Pryor (D-Ark.), Lincoln Chaffee (R-R.I.) and Kent Conrad (D-N.D.).

The stakes of the campaign are great, not only for the super-wealthy families, but for the public. If the families repeal bid succeeds, it will cost the U.S. Treasury a trillion dollars in the first decade roughly what it would cost to provide health insurance for every uninsured person in the United States.

Posted by: CFShep on April 29, 2006 at 8:23 AM | PERMALINK

Don't know about the last two years, but income has gone up for the lower earner and expenditures have been going down.

Posted by: aaron on April 29, 2006 at 8:28 AM | PERMALINK

mca: For which the debt isn't balooning.


The $331 billion deficit for 2005 is the 3rd worst in U-S history. Over the last 3-years 2003, 2004 and 2005 - the Bush Admin. has overseen the 3-largest deficits in our nations history. - CBO 8/15/05

The Congressional Budget Office "forecast a $371 billion shortfall for the fiscal year that ends Sept. 30, compared with the administration's $423 billion - a $52 billion gap." 3/3/06


......remember...the cost of the wars is NOT included...

Congress approved the latest debt limit bill that means the debt has grown SINCE Bush took office in 2001 from about $6 trillion to $9 trillion -- about $30,000 for every man, woman and child in the U-S.

Posted by: thisspaceavailable on April 29, 2006 at 8:49 AM | PERMALINK

.


During the past 5-years private business has added only 958,000 net new jobs to the economy, while the government sector added 1.1 million jobs. - Manufacturing & Technology News 1/16/06

Posted by: thisspaceavailble on April 29, 2006 at 8:59 AM | PERMALINK

During the past 5-years private business has added only 958,000 net new jobs to the economy, while the government sector added 1.1 million jobs. - Manufacturing & Technology News 1/16/06

I'm always amazed that people who trumpet GDP all the time often don't realize that government spending is a major component of it.

Posted by: BB on April 29, 2006 at 10:55 AM | PERMALINK

Debt ballooning out of control???

Posted by: aaron on April 30, 2006 at 6:45 AM | PERMALINK

Interest burden.

Posted by: aaron on April 30, 2006 at 7:05 AM | PERMALINK




 

 

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