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View Diary: Not Enough Stimuli Could Be Worse Than None (201 comments)

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  •  Puleeze! If Stim added 6% GDP, cut unem to 5% (2+ / 0-)
    Recommended by:
    askew, mollyk

    It would be a HUGE success.  Arguing it doesn't make up for 30 years of bad economic policy in one shot is shortsighted. If Obama can 1% to GDP and cut unemployment 1% it would huge since all gov't does is jump start the regular economy, not replace it.

    Even at that, Obama certainly has the beginnings of the changes needed to make up for 30 years of bad policy.  

    1. $150B for green industry and jobs.
    1. $150B to apply current green energy by making schools, Fed. buildings etc. more energy efficient.
    1. Creating foundation of energy efficiency requirements so that after the next two years, it is self sustaining as US homeowners and business owners go green meeting higher efficiency standards.

    They in turn cut US oil use, cut US trade deficit which feeds MORE money into US economy.

    A virtuous circle

    •  Have SS and entitlements been figured in re: Depr (0+ / 0-)

      ession vs now GDP %?  How close does the stimulus + TARP and TARP like + entitlements spending come to the 25% of GDP WW2 deficits? (And wasn't it actually 100 % of GDP at least 1 year, or am I misremembering that?)

      Much of the FDR spending remains today as SS, unemployment compensation, etc.  Other, e.g., medicare, medicaid, food stamps, has been added since.  (Though some has also been abolished.)

      OTOH, much of the 'Alphabet' spending (CCC, 'WPA' type etc.) disappeared as the war economy got roaring 1938 and post, and the remaining entitlement spending (SS mostly) was tiny by them.

      Any one know what the adjusted numbers really are?

      •  Tax the rich .. (1+ / 0-)
        Recommended by:
        cgirard

        problems solved ..

        •  Different question - does it spend enough (what (0+ / 0-)

          the diarist asks) vs. how and who pays (later, cause its all deficit now - as it should be when combating consumption shortfall and hoping to produce multiples of wealth through recovery).

          Ultimately, I also agree with you - for the same reason Willie Horton robbed banks, its were the $ is.  But, Obama has made a politic calculus not to open that front in this war atm.  Wise or not, I console myself with the fact that most Bush tax cuts expire in 2010 and I don;t see Democrats re-enacting most of the ones benefiting the rich.  Thus, assuming the recovery plan works, the rich WILL be paying for this bill.  As they should - having gotten most of the benefits the last 8 years and medium income falling by $ 2000.

          OTOH, I wish I could shoot half the NewsBarbies/Kens.

      •  SS/Medicare are irrelevent to effect of Stimulus. (0+ / 0-)

        Issue was effectiveness of current stimulus package.

        The claim was it was not "big enough" as it would "only" produce a 6% GDP bump and "only" lower unemployment two percentage points.

        If the stimulus did that, it would be a HUGE success. So the author's criticism of the stimulus as "not big enough" is wrong judging it by the performance he expects.

        Comparing stimulus package to WWII is simply out to lunch.  We have unemployment of 7% not 25%. We have unemployment insurance, SS, medicare providing a baseline for newly unemployed and elderly which also provides money into the economy.

        •  Your last sentence was part of my question: i.e., (0+ / 0-)

          is the demand shortfall is Depresssion level once the Depression-legacy programs (SS, unemployment compensation, etc.) is added to the currect stimulus bill and TARP+TARP-like (or more properly a % of same, since banks are not 'spending' a lot in loans)?

          If it is, then his analysis of the stimulus being too small is faulty.  Whether it is the most efficient mix of spending vs. taxcuts is another issue entirely.

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