Editore"s Note
Tilting at Windmills

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June 21, 2010

IT'S THE ECONOMY, STUPID, CONT'D.... Another day, another piece in a major media outlet about Congress deliberately choosing to emphasize the deficit over economic growth and job creation. Congressional Republicans, not surprisingly, are unanimous in trying to undermine the economy, but far too many Democrats on the Hill have internalized right-wing talking points, too. In an election year, hand-wringing Dems actually believe they'll be better off with a weaker economy. It's bewildering.

In a major shift in congressional politics, Democrats have developed a severe case of sticker shock, just as many of their colleagues press to prime the pump of the economy in time for the mid-term congressional elections.

Now, even popular initiatives with widespread support ... are stalled inside Congress.... But as the White House plans a push this summer to sell the results of last year's massive stimulus bill, the prospects of any major new investment this year appear bleaker by the week.

It adds instability to a creaky economic recovery -- and adds a new dimension to a volatile political year, as the White House watches its pull on Capitol Hill diminish as elections approach.

This is genuinely insane. The economy is struggling to get back on track, and more than a few panicky Dems have concluded, "Maybe now would be a good time to start listening to those who put us in the ditch in the first place."

I mean, really. Are there Tea Party sympathizers out there who will vote against Dems over the huge deficit (which Republicans created)? Sure. But those votes are gone and won't come back if Dems abandon their efforts to improve the economy -- and they can be offset by votes earned by taking positive steps to create jobs.

There was a point not too long ago when Democrats thought the focus should be "jobs, jobs, jobs." Now, with the elections drawing closer, some of the Dems have decided the focus should be "deficit, deficit, deficit" -- a deficit that will, by the way, get worse if more Americans are unemployed.

As a result, recovery measures aren't passing, unemployment benefits are ending, popular tax credits are languishing, and massive state layoffs are coming. Congress has the means to act, but it's choosing not to.

I don't want to overstate the Democratic role in this -- most Dems are right where they need to be, and are up against a Republican Party that acts as if it's trying to sabotage the national economy. Even if Dems were entirely united, moving forward would be difficult.

But the fact that there are any Dems at all who have decided to stop caring about economic growth is unfathomable. This is like ritual electoral suicide.

Paul Krugman asked today, "Spend now, while the economy remains depressed; save later, once it has recovered. How hard is that to understand?"

It's much easier to understand than Dems who are so afraid of their own shadow that they're losing their nerve just when the country needs them to step up.

Steve Benen 10:35 AM Permalink | Trackbacks | Comments (48)

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Comments

You Blue Dogs want to cut something, cut the defense budget. There are lots and lots of meaningless defense projects that could be cut and nobody outside the defense contractor community would notice. Oh a few generals might have to actually retire and find work in the private sector, but the nations defense wouldn't be compromised one bit. Just adopt the budget Gates keeps pushing and save untold billions.

You won't do it? Why? Too much economic hardship in your own districts. Imagine that.

Posted by: Ron Byers on June 21, 2010 at 10:41 AM | PERMALINK

Yet the House will probably soon pass a $58.8 billion war supplemental by July 4th. As a Pentagon spokeswoman said,

"This is where it becomes disruptive to us," Kesler said. "Without the supplemental, we will need to start pulling funds from other accounts in the budget."

And by that she means the defense budget. Boo hoo. That's the defense budget that, unlike all others, cannot be touched, and for which there never seem to be concerns for such things as 'being able to pay for it' or 'sticker shock.'

Priorities, people. And you're not it.

Posted by: terraformer on June 21, 2010 at 10:44 AM | PERMALINK

"consider a congressman. Then consider an idiot. Ah, but I repeat myself."
--Mark Twain, 1872

Posted by: TCinLA on June 21, 2010 at 10:47 AM | PERMALINK

Never underestimate the ability of Democrats to snatch defeat from the jaws of victory. The economy was recovering, Joe Barton just practically handed them the midterms on a platter, and now they have to undermine the recovery. Brilliant, guys. I'll vote for you because the alternative is worse, and ONLY because of that.

Posted by: T-Rex on June 21, 2010 at 10:49 AM | PERMALINK

An alternative to cutting spending is to shift how we spend. Not all forms of spending are equal in terms of stimulus.

In particular, military spending creates only 30-50% of the jobs of health care, education, or infrastructure spending. See the study described at http://bit.ly/3PsEAG

According to the results of the study, merely shifting 20% of the defense budget to aid for the states for health care and education should create approximately 2-3 million additional jobs. That would be enough to make a big difference in the unemployment rate, dropping it by a few full percentage points.

A 20% cut in our defense budget may sound like a lot, but it is merely reducing the budget back to the levels of 2006-2007, just three years ago. See http://bit.ly/aS41RX for data.

Posted by: Greg on June 21, 2010 at 10:51 AM | PERMALINK

Gates has proposed saving $100 billion over 5 years. The Congress won't hear of it. I just read something mind blowing. At the end of the cold war the military had 17 levels of command between the President and the troops on the ground. Right now there are 30. Apparently the Defense department has become a giant "retirement" home for old academy graduates. Sort of like a lot of school districts who are loaded down with assistant superintendents and other school administrators who do nothing of consequence.

Posted by: Ron Byers on June 21, 2010 at 10:55 AM | PERMALINK

TCinLA has the key: by and large, the blue dog democrats are almost as stupid as right-wing republicans, which takes some doing.

and yes, you can count me among those who say to the deficit hawks, fine, go cut some defense spending and we'll take you seriously. until then, not so much....

Posted by: howard on June 21, 2010 at 10:56 AM | PERMALINK

Krugman nailed it with his pithy formula. During good times we should specifically *not* go into debt (even though it is "tempting" since we seemingly can "afford" it then!) That way, when something goes wrong (as from a misregulated economic system) we have the room to borrow withing - we are not already in debt.

But despite teabagger's and BPublicans' current complaints about deficits, their hero Cheney said "Reagan taught us, deficits don't matter." So now we already owe too much, and more borrowing really does hurt despite the help it can provide a depressed economy. That is how Bushney and friends f**ked America.

Posted by: Neil B on June 21, 2010 at 10:58 AM | PERMALINK

This is not rocket science. All anyone has to do is read a history book to realize that cutting spending now would be foolhardy. It was what tanked FDR's herculean efforts to rescue the U.S. in 1937. If you do not want to increase the debt, then raise taxes--particularly on the well to do. That would have much less effect on the recovery than cutting spending, even military spending.

Posted by: terry on June 21, 2010 at 11:15 AM | PERMALINK

The GOP would be more sane if Democrats were less cowardly.

Posted by: Jon on June 21, 2010 at 11:17 AM | PERMALINK

I don't get Democrats on this one. If Democrats go into the midterms with unemployment hanging at 10% or greater they will lose and lose badly. The House is gone and they'll be lucky to keep a 2-3 seat majority in the Senate which given the dlue dogs effectively gives Republicans control over both houses of Congress.

History lesson. Bill Clinton came into office with the country just starting to come out of recession and in danger of dipping back in. He deficit spent on a stimulus and boosted us out of the recession and set us on a path toward economic growth. And then as growth was setting in he rasied taxes on the wealthy. By the end of his adminstration the country had enjoyed one the largest and most widespread periods of economic growth in its history. And for the first time in decades the federal deficit was shrinking and projected to contine shrinking for the forseeable future.

Posted by: thorin-1 on June 21, 2010 at 11:18 AM | PERMALINK

I don't get, I just don't get it.

Posted by: Alli on June 21, 2010 at 11:21 AM | PERMALINK

Right you are, Terry. In my neighboring state of NJ, the Democrats have passed a surtax on the 16,000 millionaires who live there, in order to prevent property taxes for senior citizens from skyrocketing and a cut in services for the poor. Christie vetoed it ... it will 'curtail hiring.' I've always said Republicans are either liars or fools, sometimes both. That fat SOB should 'curtail' his donut intake and contribute the savings to the state. That would save millions.

Posted by: Nick on June 21, 2010 at 11:22 AM | PERMALINK

Also, re military spending: It makes sense for other forms of spending to have better economic effect. After all, if the government pays someone to make a tank, that person gets paid and can buy things etc. which helps the economy indirectly. But if the G paid someone to make a car, the car itself can be directly used by a consumer. Conserva/tarians never get this point.

Posted by: Neil B on June 21, 2010 at 11:31 AM | PERMALINK

Here's something that ought to make you grimace in pain; quick, tell me - who are the three richest countries in the world, in terms of reserve cash on hand? Give up? China, Japan and Russia. That's right, Russia, the country everybody mocks for having all their eggs in one basket, in their energy-dominated economy. Curious where the USA is? Eighteenth.

Russia spent its way out of the recession, and appears to have turned its economy around. They still have the third-largest wad of cash left over. Bush, with his crazy spending while bibble-babbling the press into a coma with his nonsense about being a fiscal conservative, blew America's cash reserves on war and power games. You only have to review the books to see the truth.

You'll never convince any of the teabaggers or the Rush Limbaugh droolers with a show of listening to financial advice from Republicans - they hate Obama with a pathological loathing, regularly calling him insulting names that make terms like "Chimpy" and "The Shrub" (that were applied to Bush) seem affectionate. When will you get it through your heads - backing off gains you nothing. Got that? If they're committed to your destruction, and they are, you will not win a single vote by wavering.

Posted by: Mark on June 21, 2010 at 11:36 AM | PERMALINK

There was a point not too long ago when Democrats thought the focus should be "jobs, jobs, jobs." Now, with the elections drawing closer, some of the Dems have decided the focus should be "deficit, deficit, deficit" -- a deficit that will, by the way, get worse if more Americans are unemployed...

It's not like it's going to cost anyone their seats.

In politics, the punishment for being wrong in the same way as everyone else was wrong is minimal. The real hammer is reserved for someone who's right too soon, or right without the safety of numbers.

People would rather hear the old familiar stories with a crust of bread than have to cope with something complicated with a banquet.

That's what kept the ancien in the ancien regime. That's what keeps folks like Mugabe or other first-generation revolutionaries in power long after they have delivered. And before it changes you need a level of immiseration we haven't even begun to see -- 1933-bad.

Posted by: Davis X. Machina on June 21, 2010 at 11:38 AM | PERMALINK

far too many Democrats on the Hill have internalized right-wing talking points, too.

Yup. Don't they realize that running up deficits is deliberate Republican strategy to undermine New Deal liberalism?

Also, what howard said about defense spending.

Posted by: Gregory on June 21, 2010 at 11:51 AM | PERMALINK

Just the fact that the Republicants are suggesting work on the deficit should be enough of a clue that its against the Dems best interests. Can anyone remember the last time they actually came up with a proposal that helped the Dems other than trying to get the McPalin's into the Whitehouse?

Posted by: just guessing on June 21, 2010 at 12:02 PM | PERMALINK

I wonder if the Blue Dogs are so stupid. At this point in the cycle, giving the people the deficit reduction they crave will not mean higher unemployment until sometime early next year. Then we get our double dip. That will be after the all important election in November.

That is a pretty cynical way to look at this deficit talk, but one that explains why all Washington is losing its collective memory.

Posted by: Ron Byers on June 21, 2010 at 12:14 PM | PERMALINK

It's not the 'economy'. It's jobs. Two different things. People care about creating jobs. Economic growth is a more abstract concept. Democrats need to talk about creating jobs.

Posted by: smintheus on June 21, 2010 at 12:16 PM | PERMALINK

…. he who moulds public sentiment goes deeper than he who enacts statutes or pronounces decisions.
….the Constitution is not a suicide pact (attributed to)
— Abraham Lincoln
..I am prepared under my constitutional duty to recommend the measures that a stricken nation in the midst of a stricken world may require……
— But in the event that the Congress shall fail to [act], and in the event that the national emergency is still critical, I shall not evade the clear course of duty that will then confront me. I shall ask the Congress for the one remaining instrument to meet the crisis—broad Executive power to wage a war against the emergency, as great as the power that would be given to me if we were in fact invaded by a foreign foe.
— FDR

Our times require presidential leadership that expands the range of what is possible and keeps the public engaged. Reformist presidents, at their best, capture the public sentiment and use it to push through measures opposed by entrenched interests. President Obama has taken on some very tough and complicated issues. But as a political leader, he has largely withdrawn from public engagement on those issues… In fact, he has often spoken to weaken bills dealing with those issues (stimulus package, health care, financial reform, oil spill, climate change, etc., etc.)
Obama has consistently erred by imagining that conservatives and Republicans are anything than implacable enemies and trying to obtain bi-partisan cooperation and compromise. Complete waste of time and political resources and produces much worse policy than would otherwise occur. A more assertive, less reactive communications strategy, would prevent some of the political damage Obama is suffering, while preserving more of the administration's leverage to pursue good policy.

The ability to rally the people to a cause via the bully pulpit is the strongest weapon any President has. There is never a time to “stop playing politics” as the President constantly advocates for all parties (You’ll get no such repeated oxymoronic quotes from Lincoln, TR, FDR, LBJ, Reagan, or GWB). Democratic government is inherently a political business and any president is inherently a political leader. When making fundamental change, politics must be played—and played to win. I doubt any president listed above who has used the power of the bully pulpit to shape public opinion would have let themselves get hemmed in by something as trivial and mundane as Senate reconciliation procedures or cloture votes - certainly not without attempting to rally public opinion to press for overturn of such reform-preventing traditions over-turnable by a majority vote of the Senate. These aren’t Constitutional issues.
When the majority fails to do what's necessary, that is on the majority. They could have blown up the filibuster, but they didn't want to, primarily because many Democrats in the Congress actually prefer Republican policies, and wished an excuse for inaction.
Obama knew it. He failed to deliver the message. Democrats with supermajorities in Congress failed to do what was required. They continue to fail, week after week, month after month, as the evidence continues to mount that a second recession is on the way.
Obama and Democrats got the stimulus package and other policies off target-- just not as much as much as Republicans have. It's hard to see how continued Democratic majorities in Congress will make any difference unless they change their policies and break the filibuster. Not very good, but better than GWB and the Republicans is hardly a rousing political message. Obama has said he would sooner be a one-term President than compromise on core principals. What core principals is he saving up for?

Posted by: gdb on June 21, 2010 at 1:40 PM | PERMALINK

Right on gdb!

Posted by: terry on June 21, 2010 at 3:17 PM | PERMALINK

Poor Barry. How long will it take him to "drain the swamp" or "clean up the mess" or whatever today's excuse is. This kindergarten crew, no I take that back I do not want to embarrass 5 year olds, will never be responsible for anything. I'm of the opinion they should not stop with blaming President George Bush with their problems. I think they could probably go back as far as Eisenhower and every Republican president following. I mean, man, share the blame around. Of course it might help you solve things if some actual adults with experience beyond community organizing were on hand. Better get the attack machine in gear, there is a thrashing a coming!!!

Posted by: Simp on June 21, 2010 at 4:05 PM | PERMALINK

The issue has been jobs for the past two years, yet everything other than jobs gets addressed. Everytime Obama talks about jobs, the emphasis lasts about 48 hours and then the administration is off to something else. There is no focus. The presidency has always had to deal with circumstances. This is Obama's leadership weakness. He doesn't like dealing with things that aren't big picture, legacy making items, such as health care, global warming, remaking the US as one among many. Oil spills, recessions, Korean submarines, Iranian bombs, Israeli embargos - these are inconveniences. They get mentioned, but he always goes back to the big picture. In the end, events overwhelm the dreams. Unfortunately, the president can't say "let there be light" and it happen. Stuff happens and he has to deal with it. But he doesn't, so his "hope and change" just slips away. Sad.

Posted by: emmausman on June 21, 2010 at 4:09 PM | PERMALINK

The last I looked, Congress spends the money. So, if Democrats have been in the majority of both houses since 2006, then aren't they to blame? And, if they didn't like the deficit spending, cost of the wars, etc., then why did they pass the spending measures? Seems like Democrats want to spend the money and blame it on others.

Posted by: Rumormonger9 on June 21, 2010 at 4:15 PM | PERMALINK

Paul Krugman's comment is very hard to understand, since its based on Keynesian theory, which many think is as worthless as most else of Krugman's convenient thinking. Even were Keynes to be right, the Democratic stimulus that was passed would have still been the failure it has been. The money was spent on the wrong things. It didn't create jobs.

For most Americans, we are delighted that the silly economic policies of the Democrats have proven so fruitless and wasteful, because it makes it easier to get rid of them this fall. For that, we are grateful.

Posted by: Gordon Monsen on June 21, 2010 at 4:15 PM | PERMALINK

Krugman is stupid. Even Romer wrote a paper on how Keynesian theory doesn't work before she went to work for Obama.

It is a shame so many Americans have to suffer so greatly because Obama and the democrats were elected. And Americans, many, many are suffering financially, then many others are suffering from lack of confidence and pessimism. He has done alot to undermine this country's citizen mental health.

Posted by: hmrhonda on June 21, 2010 at 4:25 PM | PERMALINK

I wonder how old this Benen is? Has he not remembered the fact of tax cuts getting us out of a recession??? JFK, Ronaldus Magnus, W., yes, even W. We know that works. Deficits and debt now makes FDR look like a piker. I just love these young leftists who are economic idiots like Benen. Just keep spending for unions, minorities, and yet there is no job creation. None except in the public sector. Where are the private sector jobs? This socialist pacifist naif in the WH is a leftist ideologue and this guy Benen thinks he should have more debt, deficits and spending and taxes?? Steve, you need to take my Eco. 101 class that I teach in college. You are a dunce. And so are the Dems that you salivate over.

Posted by: Glenn Koons, Long Beach, Ca on June 21, 2010 at 4:39 PM | PERMALINK

"Spend now, while the economy remains depressed; save later, once it has recovered. How hard is that to understand?"

Moron. How about save now and save later...

Posted by: Princeton Jerk on June 21, 2010 at 4:40 PM | PERMALINK

Wow. The Washington Monthly comments section appears to be the thinktank for the delusional. Bill Clinton saved us from the brink of recession? The Republican majority had NOTHING to do with that....

Posted by: Indiana Jim on June 21, 2010 at 4:50 PM | PERMALINK

What a load of horse hockey! Where do I start?

The ditch? So heading straight for a cliff with the pedal to the metal is better than a ditch? A ditch is survivable, a cliff is not. Perhaps they have concluded that they should start listening to their constituents before they are tarred and feathered.

Are you serious? In Bush's second term, the deficit grew to 160 bil. with lots of help from congressional Dems. Now, Obama and the Dems have multiplied that by a factor of about 8, with nothing but debt to show for it. That is, unless you count all of the expected support and campaign contributions from the major beneficiaries of that debt, labor unions.

Fact: the only jobs government can create are government jobs. The unnecessary and dangerous practice of growing an already grossly bloated government will certainly cost Dems a whole lot more votes than it will gain.

Face it, the American people are rejecting the progressive/socialist agenda by a margin of about 2 to 1. Obama will lose his majority in the House, and possibly the Senate as well, this November, and will be a one-term president. Progressivism (Socialism) will have to crawl back into it's hole and try to re-invent itself yet again.

Posted by: SamAdams25 on June 21, 2010 at 5:09 PM | PERMALINK

What a load of horse hockey! Where do I start?

"a few panicky Dems have concluded, "Maybe now would be a good time to start listening to those who put us in the ditch in the first place.""

The ditch? So heading straight for a cliff with the pedal to the metal is better than a ditch? A ditch is survivable, a cliff is not. Perhaps they have concluded that they should start listening to their constituents before they are tarred and feathered.

"--the huge deficit (which Republicans created)"

Are you serious? In Bush's second term, the deficit grew to 160 bil. with lots of help from congressional Dems. Now, Obama and the Dems have multiplied that by a factor of about 8, with nothing but debt to show for it. That is, unless you count all of the expected support and campaign contributions from the major beneficiaries of that debt, labor unions.

"--votes earned by taking positive steps to create jobs."

Fact: the only jobs government can create are government jobs. The unnecessary and dangerous practice of growing an already grossly bloated government will certainly cost Dems a whole lot more votes than it will gain.

Face it, the American people are rejecting the progressive/socialist agenda by a margin of about 2 to 1. Obama will lose his majority in the House, and possibly the Senate as well, this November, and will be a one-term president. Progressivism (Socialism) will have to crawl back into it's hole and try to re-invent itself yet again.

Posted by: SamAdams25 on June 21, 2010 at 5:17 PM | PERMALINK

"The fault, dear Brutus,lies not in our stars, but in ourselves...."

Dems have never been able to "save." Clinton only balanced the budget after the GOP took Congress and forced an adversarial relationship on him. Face it, even progressives understand that the fundamental problem with Krugman's position is that the Left will never find the point at which to begin "saving." There is always something on which the liberal heart desires to spend even borrowed money, and they would sacrifice the long-term health of the economy, which requires at least a semblance of fiscal sanity, for the perceived short-term political gain of "jobs now."

You had your chance with the stimulus bill, and you spent most of it on useless crap. Just because you made your choice about what to spend the money on, and it turns out to have been wrong, doesn't mean you can go back to the well. Congress, in the hands of Pelosi and Reid for 3½ years now, has gone from modest deficits due to the expense of war (rightlt or wrongly), to spending so outrageous they can't even publish a budget resolution. Even the politicians can't summon the fluffery to cover up the debt projections, which ought to be frightening.

A drunk can't drink his way out of alcoholism, and the U.S. can't spend its way out of debt. Those who want us to borrow more act like home buyers who thought they could buy million dollar homes on $50K salaries, finding a way to pay for it later. Liberals either don't understand or don't care that increasing debt costs more and more money, and takes vital capital out of the private sector, starving the engine of capitalism. Either way, they have proven they cannot be trusted with the Exchequer.

Posted by: INTJ on June 21, 2010 at 5:37 PM | PERMALINK

Wow, where did the last half dozen posters come from? We have a certain amount of agreement that the Dems including Obama have not exactly hit it out of the park, but your trashing Keynes, suggesting Obama is a socialist and that we should save now as well as later, suggests either you are just parroting GOP talking points or you are all graduates of Glen Koons' Econ 101 course. Does that include a chapter on creationism? Keynes gets proven right over and over again. His General Theory exactly explains what happened in 2008 and finally got me to understand the liquidity trap. There has never been any empirical support for either supply side economics and certainly free markets are what gave us the Great Depression, The Great recession and the Gulf Debacle. Of course government jobs create private sector jobs--why do you think it is so hard to close military bases and cancel wasteful weapons programs? If Obama was a socialist we would have had a single payer health system and a new payroll tax to pay for it. I could go on and on. Just like I have little tolerance for some of the liberal folks who post here and are ideologically pure, but empty headed, I can not take any of your points seriously when they are obviously just dumb.

Posted by: Terry on June 21, 2010 at 5:38 PM | PERMALINK

This article is too simplistic. "Spend now, save later" misses the biggest point: "Spend now on WHAT?"

The stimulus spending that the Obamacrats pushed through as an emergency went to items that did not create jobs or promote growth. Money funneled to states to protect union employees from pay or benefit cuts do not ad a single job to the economy. Nevertheless, this was nearly 25% of the stimulus. The so-called shovel ready jobs were really only ready for a shovel needed to remove the BS surrounding them. Still less than half of that segment has ben spent. The academic grants for the bogus studies also did nothing to promote job growth.

Think what could have been done had the stimulus been directed all at building alternative energy facilities. Hundreds of wind farms could be in place now with lower cost energy and less pollution. How about if the government bought a fleet of cars powered only by natural gas. that would have created both jobs and a new industry. Even infrastructure projects (not just street repaving) would have made sense. Better roads and rails and airports woudl help in the future with growth. Instead we get mostly signs that claim expenditures, but no projects and no growth.

Economics is not simplistic. Repeating talking points do not make them true.

Posted by: Jearonso on June 21, 2010 at 5:38 PM | PERMALINK

Do any of you genius commenters have ANY idea how much a trillion dollars is? Now try on 130 trillion!

Posted by: lyle on June 21, 2010 at 5:39 PM | PERMALINK

So what happens when the interest on the debt begins to approach 50% of spending... and then 60% of total spending...

Raise taxes again?

Maybe if 'progressives' hadn't wasted the $787B stimulus fund... and played politics with earmarks, and special 'friends' you could be trusted - but you didn't. You wasted a good share of that money. Nobody trusts you now.

Posted by: Bill Sanford on June 21, 2010 at 5:46 PM | PERMALINK

>Keynes gets proven right over and over again.

So where is his vaunted "multiplier," then?

>If Obama was a socialist we would have had a single payer health system and a new payroll tax to pay for it.

Are you really implying that Obama DOES NOT want this? And you calling others dumb?

Posted by: lyle on June 21, 2010 at 5:47 PM | PERMALINK

Hopefully this will be the last time Keynes is proven wrong.

A good contemporary example of the right thing to do would be Canada. During the last recession, Canada acted aggressively to reduce its' debt. Now Canada has the fastest growing economy in the West.

The G20 will demand that all nations reduce debt even more aggressively than Canada has.

The Liberals have proven again that they haven't a clue how to create a job or to stimulate an economy.

Posted by: MikeS on June 21, 2010 at 6:07 PM | PERMALINK

thorin-1 you are right about Clinton, we did have a surplus when he left office. He had a Republican controlled congress and that is what we need this year and I hope that gets us back to some fiscal sanity

Posted by: waldo on June 21, 2010 at 6:07 PM | PERMALINK

""Spend now, while the economy remains depressed; save later, once it has recovered. How hard is that to understand?""

"Once it has recovered"?

How about "IF it has recovered"?

You're not going to be able to get the economy booming by Keynesian pump-priming this time--because the rest of the world won't let us. India and China are hard at work bidding down the wages of American workers to their level. (300 million Americans outnumbered 6 to 1 by Indians and Chinese.) The Big Three auto makers are never going to come back, they're killed by Honda and Toyota (who are non-unionized).

FDR didn't have that problem in the 1930s.

LBJ didn't have that problem in the 1960s.

Instead, all those massive deficits are going to lead to stagflation: The excess demand will bid up prices, but U.S. industry won't be able to produce more to meet that demand because of foreign competition.

Not to mention the fact that a growing population is going to find its mobility increasingly restricted, as global warming requires more and more restrictions to be put on (gasoline-powered) cars and trucks.

We have genuine structural problems in this country that are going to take a long time to fix. We need to restructure America to be more competitive with new foreign entrants into heavy industry and high-tech.

Posted by: sinz54 on June 21, 2010 at 6:08 PM | PERMALINK

You've got to stop saying things like "the Republicans drove us into a ditch." It's no longer tenable, considering that the ditch is so much deeper now than it ever was. We have a much bigger deficit and a much worse unemployment than when the Dems took over. And Obama's people are still digging the ditch deeper, with more unfunded mandates, more give-ins to big labor unions, more job-killing taxes and regulations, more entitlements....

Posted by: Josiahtx on June 21, 2010 at 6:24 PM | PERMALINK

Under Clinton, the size of federal government spending was reduced to 18.4% of GDP. Whether you want to give the credit to Clinton or the Republican Congress, less government produced a surplus that could have been used to reduce the debt.

Posted by: MikeS on June 21, 2010 at 6:34 PM | PERMALINK

Just give me a trillion dollars. I'll spend it where it will do some good. How hard can it be to spend other people's money?

Posted by: russ on June 21, 2010 at 6:35 PM | PERMALINK

Last time I checked;
1- Bush couldn't sign ANYTHING that a Dem controlled house and a Dem controlled senate did not sign off on first. So the 'blame Bush' excuse for everything BS is wearing pretty thin. For Bush's entire term the Dem's controlled both congress + senate (the budget in particular being a congress controlled thing). If they didn't want him to sign something, they had the votes to stop him. THEY DID NOT. So why did so many Democrats go along with Bush for so long?

2- If the above is incorrect, and it really is "all Bush's fault" then one must conclude that Bush and his republican minority were more effective then the Dem's and their majority. So apparently the "Bush and the evil republicans" are more effective with a minority then the Dem's are with a majority. Either way (1 or 2) the Dem's look like a bunch of incompetent idiots.

3- Oh, BTW, Bernake + Gates, co-architects of "the Bush economy" and "the Bush war" are the only 2 members of the Bush administration that Obama chose to keep in their jobs. So apparently he doesn't have the same problem with the job they did under Bush back then and are now doing under him.

4- If spending like drunken sailors is the solution, then give Bernake/Bush + congress + senate full credit for the $750B TARP idiocy, it was their idea. If spending like idiots is the PROBLEM and not the solution, then criticize Bernake/Obama + congress + senate under Obama just as you did under Bush. Other then the dumba$$ in white house most of those folks are the same exact ones doing the same exact things.

Posted by: shaun mcmaster on June 21, 2010 at 6:37 PM | PERMALINK

The economy belongs to the Democrats. When they touted and passed their trillion dollars corrupt stimulous bill as the answer that would restore they economy and keep us at or under 8% UNEMPLOYMENT they and Obama made it theirs. When they decided to spend the next year working on the corrupt healthcare bill instead of worrying about jobs or the economy they doubly made the economy theirs. The arrogant grab for power over the healthcare bill, the trillions and trillions in corrupt spending and debt have all made people afraid. Even the Democrats are figuring out that more and more corrupt spending by the Government leading to ever more massive debt is not the solution.

Posted by: valwayne on June 21, 2010 at 7:17 PM | PERMALINK

IT'S THE FRAUDULENT RIGHT-WING ECONOMIC THEORIES, STUPID.

Right-wing frauds like Blanche Lincoln and their supporters are the problem.

Blaming Republicans and "more than a few panicky Dems" fails to mention that OBAMA is both promoting, supporting, and "listening to those who put us in the [economic] ditch in the first place."

Right-wing frauds like Geithner, Summers, Bernanke, and now Blanche Lincoln are only in power because Obama has repeatedly chosen to appoint and support them.

As someone who will vote for Obama in the General Election of 2012, it's increasingly only because his 'half-crazy' is still better than Republican's 'full-crazy'.

But let's be clear, Obama's economic theories are definitely 'half-crazy'.

Obama could have supported a larger stimulus in January 2009, he could have supported a better targeted stimulus, he could have rescinded Republican Bush's gifts to the ultra-wealthy, he could have pushed for more jobs, he could have refused to re-appoint Republican Bernanke, he could have refused to appoint right-wing economic frauds like Geithner and Summers, he could have refused to support regressive Blanche Lincoln in the Democratic Primaries against a superior Democratic alternative.

Even now Obama could still use BP's oil catastrophe as an opportunity to push for a strong jobs bill to get US off of dirty-energies, effectively mitigating several problems simultaneously: Unemployment, the boatloads of money funding oil dictators (who in turn fund the 'terrorists' we're fighting), and global climate change.

But such actions would require an actual progressive President, not a right-wing neoliberal pretending to be.

Posted by: Annoyed on June 21, 2010 at 8:49 PM | PERMALINK

shaun, last time I checked the Rep's controlled both houses for Bush's 1st 6 years, the Dem's didn't take control until '07.

Posted by: Calvin on June 21, 2010 at 8:50 PM | PERMALINK




 

 

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