The best stimulus? Spend less, borrow less

old-timer wrote:

WBU ALUM wrote: But I do know that there are over 15 million unemployed and underemployed Americans. 827,000 created jobs -- half of 1 percent -- won't make a dent over 2 years.

You sure 827,000 is half of one percent of 15 million ? OT doesn't think so.

OT..........

I stand corrected. Thank you.

When arriving at 0.055, I failed to move my decimal.

Employing 5.5% of the 15,000,000 leaves 94.5% of the unemployed still unemployed.

What did Obama say...the stimulus saved or created 3m jobs? Where are they?

1. Labor market: The labor market holds the key to a recovery in housing. "We need more job growth in this country for a housing recovery to take hold," Dwyer says. That's because a steady income stream is the first step to home ownership. And with the national unemployment rate sitting at an uncomfortably high 9.5 percent, a great deal of potential buyers are either out of work or worried about losing their jobs. And until jobs and confidence return, the market won't have enough demand to support a sustainable recovery, says Mike Larson of Weiss Research. "This is truly a jobless recovery to end all jobless recoveries," Larson says. "And that's why I think the housing market is still struggling."

http://news.yahoo.com/s/usnews/20100716 ... 9uc3RoZWg-

there simply is no other solution than the stimulus,
we all know who destroyed the US economy.
At this moment, the republicans are offering the same politics that destroyed the US economy, and the world economy
the bush politics brought us in a world wide recession,
the republicans are offering the same politics that started this recession,
this is crazy, that's why the stimulus is the only, although far from perfect solution !!!!!

The Financial Regulation Vote Shows That the GOP Is not the Solution
Republican policies precipitated the recession,
and the party's solutions are to offer more of the same.
And when it came to deciding who to stand up for,
the Republicans attacked the unemployed and stood with the banks.
Americans' anger is legitimate,
but directing that anger by giving power back to the GOP is misplaced.

cookie wrote:there simply is no other solution than the stimulus,
we all know who destroyed the US economy.
At this moment, the republicans are offering the same politics that destroyed the US economy, and the world economy
the bush politics brought us in a world wide recession,
the republicans are offering the same politics that started this recession,
this is crazy, that's why the stimulus is the only, although far from perfect solution !!!!!

The Financial Regulation Vote Shows That the GOP Is not the Solution
Republican policies precipitated the recession,
and the party's solutions are to offer more of the same.
And when it came to deciding who to stand up for,
the Republicans attacked the unemployed and stood with the banks.
Americans' anger is legitimate,
but directing that anger by giving power back to the GOP is misplaced.

I had seen where you posted the link for this article, this morning. But, it is not showing tonight.

I had read the article past what you had quoted. The reason the GOP didn't want to vote for the benefits to be extended was because, they didn't want to borrow the $38bn to pay for it. There is still $90+bn left unspent from the stimulus and the GOP wants to use that. The dems won't release the funds.

To be fair and balanced, Obama's criticism of the GOP pointed out that, the GOP did all this spending when they were in control. Why do they want to stop now?

To their defense, I would say...You gotta start someplace.

And when it came to deciding who to stand up for,
the Republicans attacked the unemployed and stood with the banks.

It would seem to me that, by not borrowing the money to pay for the extension, they are siding with the citizens by not putting us farther in debt. If they borrow the money, they would be paying more interest to the banks. By not borrowing, how does that side with the banks?

1) Keep in mind, the cost of the extension for people unlucky enough to be caught in the jaws of the worst recession in thirty years is $35 billion. The bill would increase the debt by less than 0.3 percent.
The republicans say that this has to be paid for.

2) but why not also "pay for" a re-authorization of the tax cuts, which will cost $678 billion?
now suddenly these republicans are no longer deficit hawks ?????
this 678 billion doesn't has to be paid for?????
or they start their well-known proven lies that this tax cuts will pay for themselves... people have learned and they know better!!!!
Polls released last week showed that despite anxiety about spending, registered voters actually favor helping the unemployed even if it adds to the deficit.
http://www.huffingtonpost.com/2010/07/14/unemployment-deficit-polls-voters_n_646600.html

these republican deficit hawks are hypocrites, as always,
they rather let 2.5 million americans starve than give a tax break to the rich...incredible,
one keeps on wondering how is it possible that the US citizens keep on voting for these hypocrites

it seems that Carl Rove thinks that the stimulus is the best and more has to be spent

or do we have some hypocrite republican cons at work again?????

On Thursday evening, the new conservative group American Crossroads -- conceived of by veteran GOP operatives Karl Rove and Ed Gillespie -- released a TV advertisement attacking the Senate Majority Leader for, of all things, not bringing enough stimulus dollars back to Nevada.

http://www.huffingtonpost.com/2010/07/18/anti-stimulus-group-attac_n_650386.html

interesting to know that the republicans are now demanding for MORE STIMULUS and MORE SPENDING

and yet more demand for more stimulus spending:
could it be possible that so many that ask for more stimulus are dead wrong????

Federal Reserve Chairman Ben Bernanke reiterated Wednesday his belief that Congress should continue to prop up the sputtering economy, casting aside concerns that the federal budget deficit should trump the economy's need for additional stimulus.

In other words, Congress should spend now and worry about deficits later.

http://www.huffingtonpost.com/2010/07/21/bernanke-to-congress-the_n_654678.html

"At the current moment the large deficits, as unattractive as they are, are important for supporting economic activity," the nation's central banker told a Senate panel, citing "weak" private spending and a "great deal of excess capacity."

he had to be very careful indeed,
but his conclusion seemed clear to me:

Treading carefully, he said Democrats were right to continue government spending to spark the economy amid a deep downturn. However, he said, they must signal how they'll reduce deficits.

"Although the deficit is very high, it is probably necessary to support the current recovery," Bernanke said, calling for tough deficit-reduction measures from 2013 to 2020 that could be adopted now to give investors clarity and certainty.

As has become common, senators of both parties pressed Mr. Bernanke to weigh in on the fiscal questions that have bitterly divided Congress. Mr. Bernanke held to his view that additional small-scale fiscal stimulus could be beneficial to the economy now, if combined with medium-term measures to rein in the high deficits.

“I would be reluctant to withdraw that support too precipitously in the near term,” Mr. Bernanke told the committee’s chairman, Senator Christopher J. Dodd, Democrat of Connecticut. “At the same time, to maintain confidence and keep interest rates low, it’s important that we have a strong and credible plan to reduce deficits over the coming years.”

http://www.nytimes.com/2010/07/22/business/22fed.html?_r=2&hp

conclusion:
the stimulus worked and it is best to stick to it now combined with plans for deficit reduction.

by the way,
here was his answer to the Bush tax cuts:

Pressed on whether he favors tax cuts to stimulate economic activity, Bernanke, a Bush-era appointee, reminded lawmakers of the problem of paying for them.

"If you extend the tax cuts, you have to find other ways to offset them," he said.

and more studies that prove that the stimulus works !!!!

two leading economists released a study that “empirically proved” that the government’s response to the Great Recession, including the stimulus bill, prevented the loss of “some 8½ million jobs.” The study’s authors — former McCain economic adviser Mark Zandi and former vice chairman of the Federal Reserve Alan Blinder — concluded that “there is little doubt that in total, the policy response was highly effective.”

http://www.nytimes.com/2010/07/28/business/economy/28bailout.html

In a new paper, the economists argue that without the Wall Street bailout, the bank stress tests, the emergency lending and asset purchases by the Federal Reserve, and the Obama administration’s fiscal stimulus program, the nation’s gross domestic product would be about 6.5 percent lower this year.

In addition, there would be about 8.5 million fewer jobs, on top of the more than 8 million already lost; and the economy would be experiencing deflation, instead of low inflation.

“While the effectiveness of any individual element certainly can be debated, there is little doubt that in total, the policy response was highly effective,” they write.

“When all is said and done, the financial and fiscal policies will have cost taxpayers a substantial sum, but not nearly as much as most had feared and not nearly as much as if policy makers had not acted at all,” they write.

and of course the republican hardcore won't accept these facts, as usual.....

and of course the republican hardcore won't accept these facts, as usual....

Cookie, it's a shame that you find it necessary to put your political spin or view on otherwise well balanced articles that you post. You've posted an interesting article about "financial stimulus" and then spoil it all, by getting into political point scoring. To me it undermines the validity and merit of your main post, if not the article itself. Or is it just a "lure" to draw others into yet another political debate!

Anyway, to get back to the main topic, I see the point behind the original post as one advocating a general practice/philosophy of spending less and borrowing less, whereas the article quoted seems to be dealing with the merit of using a fiscal stimulus program to stimulate early recovery from a recession, or indeed to prevent an even deeper recession. You may note that the second article above does then proceed to point out the need for a plan to reduce deficits and "to rein in the high deficits" over the coming years.

If your intention is to suggest or focus on the merit of using fiscal stimulus in the above scenario, then the big question will remain - at what point does one stop the stimulus and start reigning things in, or introduce austerity measures. I suspect the answer to that question may well be different in different countries/different economies, and based on their particular stage in the cycle and economic circumstances.

Cookie, I don't think you can post anything that Arjay will not find fault with. He's a nit picker.

as mentioned before,
Arjay, get a life.....

Udonexpat and cookie, is it really necessary to resort to flaming and naming calling?

lee wrote:Udonexpat and cookie, is it really necessary to resort to flaming and naming calling?

lee, I hope you have the honesty to call out the instigators first.....