825 Billion Bailout

dhickey · January 18, 2009, 12:42am

[quote]Ryan P. McCarter wrote:
I love this logic. The current recession is Obama’s fault, the fact that he hasn’t been inaugurated yet is not important. It couldn’t have been George Bush’s multi-trillion dollar war, his ludicrous tax cuts, etc. None of that.

Of course to be fair, it’s not all his fault either, he just greatly exacerbated a problem we already had.[/quote]

what do tax cuts and war have to do with a recession? You have no clue when it comes to economics. You have proven this over and over and over again.

dhickey · January 18, 2009, 12:46am

[quote]Ryan P. McCarter wrote:
For the right-wingers, this is exactly the situation that your policies have created. Privatized gain and socialized loss.
[/quote]
How exactly?

[quote]
But the corporations shouldn’t have to pay! Then they won’t be able to create any more jobs![/quote]
Then should pay? and pay what?

Berserkergang · January 18, 2009, 12:58am

The PURPOSEFUL destruction of America is on the way, well actually almost achieved and the vast majority of people still don’t believe it or refuse to see it. It’s impossible that such madness, nonsensical economic action…are the consequences of incompetence. Those guys are not that dumb, they have an agenda.

Bye bye USA! Hello North America Community! Bye bye dollar! Hello amero!

Ryan_P_McCarter · January 18, 2009, 6:46am

[quote]dhickey wrote:
Ryan P. McCarter wrote:
I love this logic. The current recession is Obama’s fault, the fact that he hasn’t been inaugurated yet is not important. It couldn’t have been George Bush’s multi-trillion dollar war, his ludicrous tax cuts, etc. None of that.

Of course to be fair, it’s not all his fault either, he just greatly exacerbated a problem we already had.

what do tax cuts and war have to do with a recession? You have no clue when it comes to economics. You have proven this over and over and over again.[/quote]

When you run bigger and bigger budget deficits, and cut taxes, that makes things worse. I never said the war caused the recession. I never said the tax cuts caused the recession. Recessions are big deals and have a lot of causes that we’ll never reach a total consensus about, but please cut the shit just for a second and admit that simultaneously spending more (especially on a no-return project like a war) and collecting less revenue doesn’t help.

Probably the biggest factor has been the housing crisis, and there’s plenty of blame to go around on all sides there.

Ryan_P_McCarter · January 18, 2009, 6:43am

[quote]dhickey wrote:
Ryan P. McCarter wrote:
For the right-wingers, this is exactly the situation that your policies have created. Privatized gain and socialized loss.

How exactly?[/quote]

Ridiculous government contracts that pay companies way too much to do shitty jobs, corporate handouts, all kinds of tax breaks. There really have been books written on the subject, I can’t do it justice here. But if you’re really interested, the information is out there.

Ryan_P_McCarter · January 18, 2009, 7:25am

[quote]pat wrote:
Ryan P. McCarter wrote:
For the right-wingers, this is exactly the situation that your policies have created. Privatized gain and socialized loss.

But the corporations shouldn’t have to pay! Then they won’t be able to create any more jobs!

Cooperation’s won’t pay, they just past the cost along in their products and services…They cut costs by cutting jobs. So what good does that do? We, the normal hard working folks still are the ones who pay it in the end.

Putting ketchup on a turd may make it taste better, but it’s still a turd. Raising taxes on cooperations may sound good, but we are still the ones who pay the taxes. Think about it, seriously.[/quote]

If they raise their prices too much, someone will be willing to sell for less, and unless they want to go out of business, they’ll have to play ball. It’s that thing called competition that neo-liberals get so weepy-eyed over in any circumstance in which they’re arguing for deregulation and privatization. If they lay too many people off, their productive capacities go down, and so does their revenue.

Now mind, I’m not proposing jacking it up to exorbitant rates, but there are a lot of loopholes to be closed.

Headhunter · January 18, 2009, 12:54pm

Eventually the dollar will have to return to the gold standard or no one will accept it as money. Sure, fiat money is enforced now but it’ll reach a point where no one will accept it. And can government put millions in prison who refuse to co-operate?

I think its perfectly normal for, about every 300 years, a society to collapse. The hubris from the old one causes it to crash and a new one grows in its place.

First rule of our new constitution: “Only gold and silver are lawful money. Anyone who attempts to create any sort of fiat money is to be immediately shot.”

LIFTICVSMAXIMVS · January 18, 2009, 7:32pm

[quote]Headhunter wrote:
I think its perfectly normal for, about every 300 years, a society to collapse. The hubris from the old one causes it to crash and a new one grows in its place.
[/quote]

Society does NOT ever collapse. Society is just concerted human cooperation. As long as humans choose to cooperate with each other society will exist. Only hermits choose not to be a part of society and they are very few and far between.

Rather, it is the Sate that must collapse when it becomes too big to manage, when looting and counterfeiting stops working, for example. This cause and effect relationship between society and the State is pretty much written in stone. Society will continue to thrive and will work out a new means to exchange and cooperate as it always has.

I can understand why people might think society would dissolve especially when a currency is destroyed because it is the exchange medium that allows cooperation to happen most efficiently. Fortunately, it is a particular state that dissolves and not society as a whole.

This process need not be bloody but most likely will be just because there will always be power-mongers looking to take advantage of a situation – thus the modern state.

dhickey · January 19, 2009, 2:44am

[quote]Ryan P. McCarter wrote:
When you run bigger and bigger budget deficits, and cut taxes, that makes things worse.
[/quote]
Makes what worse? Certainly bad to run deficits but not sure it you are saying is worse becuase of it.

What does consensus have anything to do with causes of recession? Just because you don’t take the time to understand basic economics, doesn’t mean others don’t. The boom and bust cycle is economics 101.

I am trying to cut the shit. Explain to me how gov’t spending more than it has has an effect on the recession we are in? You are talking about two different problems. The recession certainly doesn’t help the deficite, but not the other way around.

Probably? You mean the housing boom? The boom is problem, not the bust. The bust is the correction. You want to find the responsible party, find those that facilitated the boom. Actually a pretty short list of people.

dhickey · January 19, 2009, 2:50am

[quote]Ryan P. McCarter wrote:
dhickey wrote:
Ryan P. McCarter wrote:
For the right-wingers, this is exactly the situation that your policies have created. Privatized gain and socialized loss.

How exactly?

Ridiculous government contracts that pay companies way too much to do shitty jobs, corporate handouts, all kinds of tax breaks. There really have been books written on the subject, I can’t do it justice here. But if you’re really interested, the information is out there.
[/quote]

I am not grasping your point here. What have all the things you’ve mentioned have to do the recession and plan to spend 800B on even more wasteful things.

How about ridiculous goverment contracts that pay bureaucrats way too much to produce nothing, welfare handouts, all kinds of taxation driving american jobs out of the county, all kinds of regulation driving companies out of the country.

Your whole statement about books being written on the your line of thought that has absolutly no point was cute.

NealRaymond2 · January 19, 2009, 4:26am

[quote]John S. wrote:
I just don’t see how anyone could think this is a good idea.[/quote]

Maybe the same kind of people who think buying a 20,000-square-foot house for one’s own family of four to live in is an “investment”.

NealRaymond2 · January 19, 2009, 4:38am

[quote]Berserkergang wrote:
The PURPOSEFUL destruction of America is on the way, well actually almost achieved and the vast majority of people still don’t believe it or refuse to see it. It’s impossible that such madness, nonsensical economic action…are the consequences of incompetence. Those guys are not that dumb, they have an agenda.
[/quote]
They could be that dumb, or that susceptible to wishful thinking. Or they could have an agenda. Those who say don’t know, and those who know aren’t saying.

Maybe. But even if that is the plan the USA would not necessarily be overtly dismantled – we could hypothetically have a monetary union and a diminishment of sovereignty while the form and structure of the USA remain in place.

Ryan_P_McCarter · January 19, 2009, 7:11am

Why don’t you go back and dust those books off, and you’ll discover that recessions are generally complicated and don’t generally reduce to a single cause. That’s all I was saying, because it seemed to me that the previous poster was trying to lay it all on the Democrats’ doorstep.

Well, we need a lot of money right now, and we’re fresh out.

[quote]dhickey wrote:Probably? You mean the housing boom? The boom is problem, not the bust. The bust is the correction. You want to find the responsible party, find those that facilitated the boom. Actually a pretty short list of people.
[/quote]

I said “crisis.” Do you read these before you reply to them?

Ryan_P_McCarter · January 19, 2009, 7:15am

[quote]dhickey wrote:I am not grasping your point here. What have all the things you’ve mentioned have to do the recession and plan to spend 800B on even more wasteful things.

How about ridiculous goverment contracts that pay bureaucrats way too much to produce nothing, welfare handouts, all kinds of taxation driving american jobs out of the county, all kinds of regulation driving companies out of the country.

Your whole statement about books being written on the your line of thought that has absolutly no point was cute.[/quote]

I was responding to that post about taxpayers having to foot the bill for government and private waste, not talking about the recession. Some reading comprehension would be nice.

Headhunter · January 19, 2009, 1:46pm

Entrepreneurial Optimism: It’s Been Lower Exactly Once
By Marc Tracy
When, in December, we reported on the results of the National Federation of Independent Business’s November small business optimism survey, we semi-rejoiced at the news that the group’s index had hit its fourth-lowest reading in survey history–a notable improvement over the October number, which was the third-lowest ever.

December’s numbers (full report here) are…well, they’re worse. The optimism index is now at its second-lowest reading in the survey’s 35-year lifespan (which makes us wonder just how miserable things were in February 1980). “December was not a good month” is the NFIB’s pithy conclusion. Merry Christmas, indeed.

http://bizbox.slate.com/blog/2009/01/entrepreneurial_optimism_its_b.php

After the outright and utter collapse of the American economy, who’ll pay for these bailouts? We’re facing debt and deficits not seen since those of Philip II of Spain (by percentages) and the Dems want to do MORE?

Forget Great Depression and think Great Destitution, lasting a century.

hedo · January 19, 2009, 2:06pm

The federal budget deficit, as a percentage of GDP, actually shrunk under GWB. Remember it is a “percentage of GDP” that the spending is judged against if you you are going to compare apples to apples. It is going to SOAR under the Democrats proposals. This is not specualtion this is actual proposed legislation!

From a letter sent by John Boehner:

http://www.powerlineblog.com/archives/2009/01/022586.php

A Dozen Fun Facts About the House Democrats’ Massive Spending Bill

The House Democrats’ bill will cost each and every household $6,700 additional debt, paid for by our children and grandchildren.
The total cost of this one piece of legislation is almost as much as the annual discretionary budget for the entire federal government.
President-elect Obama has said that his proposed stimulus legislation will create or save three million jobs. This means that this legislation will spend about $275,000 per job. The average household income in the U.S. is $50,000 a year.
The House Democrats’ bill provides enough spending - $825 billion - to give every man, woman, and child in America $2,700.
$825 billion is enough to give every person living in poverty in the U.S. $22,000.
$825 billion is enough to give every person in Ohio $72,000.
Although the House Democrats’ proposal has been billed as a transportation and infrastructure investment package, in actuality only $30 billion of the bill - or three percent - is for road and highway spending. A recent study from the Congressional Budget Office said that only 25 percent of infrastructure dollars can be spent in the first year, making the one year total less than $7 billion for infrastructure.
Much of the funding within the House Democrats’ proposal will go to programs that already have large, unexpended balances. For example, the bill provides $1 billion for Community Development Block Grants (CDBG), which already have $16 billion on hand. And, this year, Congress has plans to rescind $9 billion in highway funding that the states have not yet used.
In 1993, the unemployment rate was virtually the same as the rate today (around seven percent). Yet, then-President Clinton’s proposed stimulus legislation ONLY contained $16 billion in spending.
Here are just a few of the programs and projects that have been included in the House Democrats’ proposal:

· $650 million for digital TV coupons.
· $6 billion for colleges/universities - many which have billion dollar endowments.
· $166 billion in direct aid to states - many of which have failed to budget wisely.
· $50 million in funding for the National Endowment of the Arts.
· $44 million for repairs to U.S. Department of Agriculture headquarters.
· $200 million for the National Mall, including grass planting.
· $400 million for “National Treasures.”

Almost one-third of the so called tax relief in the House Democrats’ bill is spending in disguise, meaning that true tax relief makes up only 24 percent of the total package - not the 40 percent that President-elect Obama had requested.
$825 billion is just the beginning - many Capitol Hill Democrats want to spend even more taxpayer dollars on their “stimulus” plan.

dhickey · January 19, 2009, 6:12pm

[quote]Ryan P. McCarter wrote:
dhickey wrote:What does consensus have anything to do with causes of recession? Just because you don’t take the time to understand basic economics, doesn’t mean others don’t. The boom and bust cycle is economics 101.

Why don’t you go back and dust those books off, and you’ll discover that recessions are generally complicated and don’t generally reduce to a single cause. That’s all I was saying, because it seemed to me that the previous poster was trying to lay it all on the Democrats’ doorstep.
[/quote]

Wrong. Every recession and the great depression have been analyzed in detail. The cause of the boom is always fairly easy to target. Bad policy to deal with the bust are also just as easy to point out. Economics is not terribly difficult to understand if you take even a small amount of time to try.

Economic policy, on the other hand, is overly complicated and only serves to slow down corrections needed in the market. Generally speaking.

we don’t need any more money. The money supply should be finite just like any other commodity. What we need is for gov’t to lower taxes and leave more of the finite supply in the hands of the market.

Congress has shown that the money collected in taxes has little correlation to the amount they are willing to spend. This is why we have a huge deficit, much of it accumulated during good economic times. It sure would be nice of them not to spend more than they have, but this has little impact on a recession unless it involves inflating the money supply or raising taxes.

So again, a recession can certainly have an effect on the deficit but not necessarily the other way around. Now, too increase spending while simultaneously collecting less in taxes is pretty dumb, but certainly not uncommon. They have done this in boom and bust.

[quote]
dhickey wrote:Probably? You mean the housing boom? The boom is problem, not the bust. The bust is the correction. You want to find the responsible party, find those that facilitated the boom. Actually a pretty short list of people.

I said “crisis.” Do you read these before you reply to them?[/quote]

There is no housing crisis. That was my point. If you understood the very basic concept of the business cycle you understand my point. We are in a correction period right now.

If you let the speculators take their losses, we will be back to normal in no time. You need to think about who the speculators are. Many of them make a great deal of money in boom, and many lose their shirts in the bust.

When gov’t encourages the boom and intervenes in the bust, we get what we are looking at now. An unnecessarily long and painful correction period. This has happened so many times, that it is not hard at all to predict.

pat · January 19, 2009, 6:51pm

[quote]Ryan P. McCarter wrote:
dhickey wrote:
Ryan P. McCarter wrote:
I love this logic. The current recession is Obama’s fault, the fact that he hasn’t been inaugurated yet is not important. It couldn’t have been George Bush’s multi-trillion dollar war, his ludicrous tax cuts, etc. None of that.

Of course to be fair, it’s not all his fault either, he just greatly exacerbated a problem we already had.

what do tax cuts and war have to do with a recession? You have no clue when it comes to economics. You have proven this over and over and over again.

When you run bigger and bigger budget deficits, and cut taxes, that makes things worse. I never said the war caused the recession. I never said the tax cuts caused the recession. Recessions are big deals and have a lot of causes that we’ll never reach a total consensus about, but please cut the shit just for a second and admit that simultaneously spending more (especially on a no-return project like a war) and collecting less revenue doesn’t help.

Probably the biggest factor has been the housing crisis, and there’s plenty of blame to go around on all sides there.
[/quote]

Ummmm, that’ be incorrect again. Taxes aren’t a zero sum game. Taxes take money out of circulation. When you take money out circulation fewer transactions take place. Since most transactions are taxable a higher tax will reduce the number of transactions that can take place. Fewer transactions equals less money. You would have to jack the taxes up stratospherically to make up the revenue.

Everybody, including the government makes more money when taxes are lower and there by increasing tax opportunity’s. It is smarter to make more taxing opportunities than it is making more tax per opportunity.

It more likened to selling in bulk versus making a killing off on thing. Take Honda and Ferrari. Honda sells a lot more cars and hence makes a ton more money than Ferrari, even though Ferrari makes a ton per car, they sell fewer cars and make drastically less money than Honda.

pat · January 19, 2009, 6:56pm

[quote]Ryan P. McCarter wrote:
pat wrote:
Ryan P. McCarter wrote:
For the right-wingers, this is exactly the situation that your policies have created. Privatized gain and socialized loss.

But the corporations shouldn’t have to pay! Then they won’t be able to create any more jobs!

Cooperation’s won’t pay, they just past the cost along in their products and services…They cut costs by cutting jobs. So what good does that do? We, the normal hard working folks still are the ones who pay it in the end.

Putting ketchup on a turd may make it taste better, but it’s still a turd. Raising taxes on cooperations may sound good, but we are still the ones who pay the taxes. Think about it, seriously.

If they raise their prices too much, someone will be willing to sell for less, and unless they want to go out of business, they’ll have to play ball. It’s that thing called competition that neo-liberals get so weepy-eyed over in any circumstance in which they’re arguing for deregulation and privatization. If they lay too many people off, their productive capacities go down, and so does their revenue.

Now mind, I’m not proposing jacking it up to exorbitant rates, but there are a lot of loopholes to be closed.
[/quote]

Your assuming in this scenario that one company would be over taxed and another not so much. Which isn’t the case because it would cause all kinds of anti trust issues and such, hence a company and it’s competition have to be taxed equally. You cannot unfairly tax HP over Dell, or Biotest over EAS…You kill companies that way. Oh the free market will continue, but you’ll be paying more for HP and Dell products, for Biotest and EAS. These people aren’t running a charity, if they aren’t going to make money, there is no point in being in business.

pat · January 19, 2009, 7:06pm

[quote]hedo wrote:
The federal budget deficit, as a percentage of GDP, actually shrunk under GWB. Remember it is a “percentage of GDP” that the spending is judged against if you you are going to compare apples to apples. It is going to SOAR under the Democrats proposals. This is not specualtion this is actual proposed legislation!

From a letter sent by John Boehner:

http://www.powerlineblog.com/archives/2009/01/022586.php

A Dozen Fun Facts About the House Democrats’ Massive Spending Bill

The House Democrats’ bill will cost each and every household $6,700 additional debt, paid for by our children and grandchildren.
The total cost of this one piece of legislation is almost as much as the annual discretionary budget for the entire federal government.
President-elect Obama has said that his proposed stimulus legislation will create or save three million jobs. This means that this legislation will spend about $275,000 per job. The average household income in the U.S. is $50,000 a year.
The House Democrats’ bill provides enough spending - $825 billion - to give every man, woman, and child in America $2,700.
$825 billion is enough to give every person living in poverty in the U.S. $22,000.
$825 billion is enough to give every person in Ohio $72,000.
Although the House Democrats’ proposal has been billed as a transportation and infrastructure investment package, in actuality only $30 billion of the bill - or three percent - is for road and highway spending. A recent study from the Congressional Budget Office said that only 25 percent of infrastructure dollars can be spent in the first year, making the one year total less than $7 billion for infrastructure.
Much of the funding within the House Democrats’ proposal will go to programs that already have large, unexpended balances. For example, the bill provides $1 billion for Community Development Block Grants (CDBG), which already have $16 billion on hand. And, this year, Congress has plans to rescind $9 billion in highway funding that the states have not yet used.
In 1993, the unemployment rate was virtually the same as the rate today (around seven percent). Yet, then-President Clinton’s proposed stimulus legislation ONLY contained $16 billion in spending.
Here are just a few of the programs and projects that have been included in the House Democrats’ proposal:

· $650 million for digital TV coupons.
· $6 billion for colleges/universities - many which have billion dollar endowments.
· $166 billion in direct aid to states - many of which have failed to budget wisely.
· $50 million in funding for the National Endowment of the Arts.
· $44 million for repairs to U.S. Department of Agriculture headquarters.
· $200 million for the National Mall, including grass planting.
· $400 million for “National Treasures.”

Almost one-third of the so called tax relief in the House Democrats’ bill is spending in disguise, meaning that true tax relief makes up only 24 percent of the total package - not the 40 percent that President-elect Obama had requested.
$825 billion is just the beginning - many Capitol Hill Democrats want to spend even more taxpayer dollars on their “stimulus” plan.
[/quote]

Shit just the oversight of that much money is likely to run in the millions.
The problem with the package isn’t the 825 B, it’s that most of it is allocated to things that have zero return. Sure you need roads, but they don’t pay you back. Paying off people’s COBRA, is all nice and good, but it would be cheaper to pay their actual medical bills. You would do more for the economy by just cutting every tax payer a piece of the pie rather than spending it on tons of pork-barrel poorly managed government projects. Most of which are temporary and provide little or no return.

I still contend the best course of action is to do nothing. This will self correct. Spending nearly a trillion bucks we don’t have on things we don’t need just doesn’t make any sense.

Does anybody else get the impression that Pelosi thinks that Obama is sitting in her seat? I kind of smell a power struggle between 1 and 3 over the next couple of years.