There are some troubling misconceptions floating around the MSM that would be good for us to discuss and refute. It is enjoyable to post some quick thoughts and sources on a variety of topics to get interested folks involved in calls for action. We have to fight back against the right wing agenda by contacting elected officials, calling the radio shows and writing to the newspapers
First up ...spending as stimulus...
- I saw the video of John McCain popping off yesterday saying that the proposal before the Senate was not a stimulus bill it was a spending bill. Apparently his jesuitical education is better than mine (BA - Economics, Georgetown) because I can't figure out how you do a stimulus bill without spending money. You can call it investment if you like (which it is...investment in infrastructure, investment in the future, investment in energy efficiency blah blah) but even tax cuts are spending, hence the phrase tax EXPENDITURES. McCain gets a pass on half of one thing, the rest of the Republican cabal in the Senate blithely went along with the Bush tax cuts and war without sacrifice (except for all the dead people) that have brought the Treasury to the point that they have to create new offerings to float the debt. Some deficit is good, but we would have been in a much stronger position to weather this storm if we hadn't squandered what we built in the 1990's.
- Help me understand this housing fetish. The Republicans are including a tax credit for $15K for people who buy a house this year. What is the point of making it cheaper to buy a house just this year? If the problem was a housing BUBBLE wouldn't you want the housing market to get back to a sustainable equilibrium? So they BUBBLE doesn't inflate again and then burst again? The National Low Income Housing Coalitionasks if this kind of money is available why not aid people on the verge of homelessness? One of the reasons the economy pumped up housing to a bubble was that the real economy was not offering alternative means of economic growth.
- The great moderate coalition of Collins, Snowe and Nelson are talking about slashing tens of billions from aid to the states. This is one area that directly relates to preserving jobs. In states across the country governors are creating budgets for the next fiscal year that depends on the total amount proposed for emergency assistance. In Massachusetts alone, Governor Patrick is planning for $1,2 Billion in this money to protect jobs in FY09 and FY10. Cut this money and more people will be out of work. Why do they need this? Because they have a fetish not just about housing, but also for an arbitrary number for the stimulus. Don't take my word for it...here is some closing thoughts from John Maynard Keynes in an Open Letter to FDR.
Individuals must be induced to spend more out o their existing incomes; or the business world must be induced, either by increased confidence in the prospects or by a lower rate of interest, to create additional current incomes in the hands of their employees, which is what happens when either the working or the fixed capital of the country is being increased; or public authority must be called in aid to create additional current incomes through the expenditure of borrowed or printed money.
More coming.