BOHICA*

[pjorourke]

Originally Posted by charlestudor2005

Oh, and when the loyal opposition is in power, like measures aren't taken? JB, I never thought of you as so naive.

Of course they all do it. This round was just breathtaking in "audacity of scope". (Pun intended.)

[charlestudor2005]

Originally Posted by pjorourke

"The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money."
Alexis de Tocqueville

PJ, I thought you abhored all things French.

[atlcomedy]

Originally Posted by charlestudor2005

I think it should go to the hobbyists scholarship fund for stimulating (YES!) providers. Now, I know Tiff & Dallas don't wander much into this realm, but they might find the idea has merit.

You say this jokingly & what I suggest is tongue in cheek as well, but (& I say this as someonewho believes most of this stimulus stuff is bad, but..), if you really want stimulus send every taxpaying American over the age of 18 a $500 gift card to be used on adult entertainment. Strippers, hookers, your choice. These woman will stimulate the economy....thing of the multiplier effect...hair-stylists, taxi services, Huggies, Jimmy Choo.....you get the picture....

Obviously this has legal & political issues...that said my 2nd best stimulus plan that would actually stimulate the economy would be something similar for the hospitality (bars, restaurants) industry

[pjorourke]

Originally Posted by charlestudor2005

PJ, I thought you abhored all things French.

Not at all.

[atlcomedy]

Originally Posted by pjorourke

Not at all.

over/under on Chucky figuring out the double entendre?

[charlestudor2005]

Originally Posted by atlcomedy

over/under on Chucky figuring out the double entendre?

Maybe he leans towards the classics...like Greek tragedies.

[TexTushHog]

A huge problem with infrastructure projects and stimulus is that they take a very long time to start and complete. Infrastructure in the U.S. is in horrible shape and definitely needs attention. But if $50B is appropriated today, it will take five years to spend it tall. You first have to prioritize projects. Then the engineering work has to be done, which often takes one to two years. Then, and only then, does dirt start flying and the vast bulk of jobs get created. If it's jobs you're after, the money would be better spend on payroll tax holidays on the employer side, or simple cash payments to individuals of modest means (who are far more likely to spend the money than save it, compared to those with means).

[charlestudor2005]

If you have a job with the Dept. of Transportation, you have a job for life.

[pjorourke]

Originally Posted by TexTushHog

A huge problem with infrastructure projects and stimulus is that they take a very long time to start and complete.

Damn! You mean this shit ain't "shovel ready"?

[gnadfly]

Originally Posted by pjorourke

This time he promises to use lube.

The Novocaine based lube, I hope.

[gnadfly]

Originally Posted by pjorourke

Damn! You mean this shit ain't "shovel ready"?

The 'shovel ready' jobs will happen when Obamacare goes into full effect!

[Chevalier]

Originally Posted by TexTushHog

simple cash payments to individuals of modest means (who are far more likely to spend the money than save it, compared to those with means).

I know that's conventional wisdom, at least among some politicians, but is it necessarily so in today's economy? It sounds logical if: (a) those with means did not curtail their spending based on the economy, because they have so much that they don't need to budget, so any extra would just go into savings/investment; whereas (b) those of modest means had curtailed their spending, so extra money goes right out the door as spending.

But, as I recall, spending by the rich (which accounts for a huge proportion of total consumer spending) dropped dramatically in the past year, indicating that their spending patterns were affected by the economic downturn (and presumably in particular due to the decrease in their investment portfolios). It's beginning to come back in recent months, but still subject to change depending on their confidence level. And among those of more modest means, there has been a significant reduction of spending in order to pay down their debt (which has not been as much of an issue for the rich).

If so, it seems possible that distributing money to those of modest means while increasing taxes on the rich might decrease overall consumer spending, further weakening the economy. Those of modest means, even with more money coming in, may still be too spooked to resume their former high levels of debt-financed spending until their debts are reduced and their home values rebound and their confidence in employment status solidifies; they may merely pay debts down or sock the money away until their confidence is restored. While the rich may prefer to reduce spending (as they did earlier in the recession) if they see their taxes going up, rather than continue spending at the same rate and reduce their savings as well. At the level of Bill Gates or Warren Buffett, it probably doesn't matter, but in the $250,000 - $1,000,000 range it very well might.

I'm not an economist and don't know the likely effect of various policy options. But I'm concerned that the government is making decisions based on generalizations, from past history, without examining them for whether they're still valid today. If they acknowledged the uncertainty, I'd respect the decisions more, even if I didn't agree.

[Mazomaniac]

Originally Posted by Chevalier

If so, it seems possible that distributing money to those of modest means while increasing taxes on the rich might decrease overall consumer spending, further weakening the economy.

But this conclusion is based on a partially artificial distinction between spending on consumer goods and spending to reduce consumer debt. BOTH of these activities are desirable. They just impact the economy at different horizons.

Stimulating consumer spending presents a short-term gain, but adds to long term problems. It should be used sparingly and only when the risk of immediate financial collapse exceeds the downsides of additional long-term debt.

Stimulating debt reduction and other forms of savings has only a modest impact on short term economic heath. However, the long term benefits from paying down consumer debt are enormous.

What you need is balance. Proper policy includes some of both of these strategies with the exact mix reflecting the current economic situation and forecast.

Unfortunately, political reality gets in the way. Politicians will rarely want to vote for a savings bill that creates benefits ten years down the line. That's one reason the health care reform was so refreshing. Love it or hate it at least people started looking at the economic impact more than one election cycle down the road.

Moral of the story? When you hear somebody from either side screaming "SAVE, SAVE, SAVE" or "SPEND, SPEND, SPEND" they're both wrong. What we need is balance, not ideological extremism. I find that true for most things in life.

Cheers,
Mazo.

[Chevalier]

Originally Posted by Mazomaniac

But this conclusion is based on a partially artificial distinction between spending on consumer goods and spending to reduce consumer debt. BOTH of these activities are desirable. They just impact the economy at different horizons.

Sure. I was just addressing the wide-spread assumption about how the proposed policy would affect the goal of increasing spending on goods/services. There's also the larger question of whether that goal is worth incurring other consequences of the policy. But the answer to the larger question depends to some extent on the answer to the initial question.

[nevergaveitathought]

From the Article:

The White House did not offer a price tag for the full measure or say how many jobs it would create. If Congress simply reauthorized the expired transportation bill and accounted for inflation, the new measure would cost about $350 billion over the next six years. But Mr. Obama wants to “frontload” the new bill with an additional $50 billion in initial investment to generate jobs, and vowed it would be “fully paid for.” The White House is proposing to offset the $50 billion by eliminating tax breaks and subsidies for the oil and gas industry.


why cant we leave well enough alone. we never learn from past mistakes, well some of us never do.

more keynesian idiocy and blue state bailout is what this boils down to it seems to me.

what airport beside military ones does the federal government own? perhaps i'm not aware of their ownership. most airports are local government phenomena. they raise funds and prosper or fail based upon the local economies and use.

of course if you run an airport in a broke wasteful-spending blue state or democrat destroyed city, you need funds siphoned off from red ones to further support the profligacy.

where are rails not maintain by burlington northern, union pacific or some other private rail road company? in the northeast or california perhaps?

states already receive highway funds from the Feds. They supplement these funds with thier own monies. some states like texas or florida readily come to mind, they have excellent highways. last time i was in california, they looked in a state of disrepair, pennsylvania's also. why am i concerned?

keynesian (read unworkable ideology), blue state, dem city, union bailout.

let the american people work and the systems that are based on sound economics and common sense prosper. let the others change. they will not change until they are forced, absolutely forced, to.

why not give us a solid understanding of our tax structure, something that can be a basis for planning. work on that. perhaps even extend the bush tax cuts. what do you think something like that would do for american small business and the effect on hiring?