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Thread: Epic, Undeniable Failure ("Stimulus Plan")

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    Default Epic, Undeniable Failure ("Stimulus Plan")

    ====

    Read this! Read it twice! The whole entire thing!! This is amazing!!!

    When the Obama administration releases a report on the Friday before a long weekend, it’s clearly not trying to draw attention to the report’s contents. Sure enough, the “Seventh Quarterly Report” on the economic impact of the “stimulus,” released on Friday, July 1, provides further evidence that President Obama’s economic “stimulus” did very little, if anything, to stimulate the economy, and a whole lot to stimulate the debt.

    The report was written by the White House’s Council of Economic Advisors, a group of three economists who were all handpicked by Obama, and it chronicles the alleged success of the “stimulus” in adding or saving jobs. The council reports that, using “mainstream estimates of economic multipliers for the effects of fiscal stimulus” (which it describes as a “natural way to estimate the effects of” the legislation), the “stimulus” has added or saved just under 2.4 million jobs — whether private or public — at a cost (to date) of $666 billion. That’s a cost to taxpayers of $278,000 per job.

    In other words, the government could simply have cut a $100,000 check to everyone whose employment was allegedly made possible by the “stimulus,” and taxpayers would have come out $427 billion ahead.

    Furthermore, the council reports that, as of two quarters ago, the “stimulus” had added or saved just under 2.7 million jobs — or 288,000 more than it has now. In other words, over the past six months, the economy would have added or saved more jobs without the “stimulus” than it has with it. In comparison to how things would otherwise have been, the “stimulus” has been working in reverse over the past six months, causing the economy to shed jobs.

    Again, this is the verdict of Obama’s own Council of Economic Advisors, which is about as much of a home-field ruling as anyone could ever ask for. In truth, it’s quite possible that by borrowing an amount greater than the regular defense budget or the annual cost of Medicare, and then spending it mostly on Democratic constituencies rather than in a manner genuinely designed to stimulate the economy, Obama’s “stimulus” has actually undermined the economy’s recovery — while leaving us (thus far) $666 billion deeper in debt.

    The actual employment numbers from the administration’s own Bureau of Labor Statistics show that the unemployment rate was 7.3 percent when the “stimulus” was being debated. It has since risen to 9.1 percent. Meanwhile, the national debt at the end of 2008, when Obama was poised to take office, was $9.986 trillion (see Table S-9). It’s now $14.467 trillion — and counting.

    All sides agree on these incriminating numbers — and now they also appear to agree on this important point: The economy would now be generating job growth at a faster rate if the Democrats hadn’t passed the “stimulus.”


    http://www.weeklystandard.com/blogs/...ob_576014.html

    Is this what Barak plans on running on in 2012? If so, he's making Jimmy Carter one happy man. We are about to have a new "worse president" in the modern era.
    Todd Robbins
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    PookyNR is offline 3D VIP 2005, '06, '07, '08, '09, '10, '11, '12, '13, '14
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    Keynesian economics never works well. Short term gain for long term pain. Mind you, I think if Keynes himself saw how some of his preachers have been applying his thoughts and crediting him, he wouldn't be too happy.
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    Brian Shillito is offline 3D VIP 2010, '11, '12, '13. '14
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    I'm afraid that this was a pill which many countries chose to swallow with "questionable" results for all those who chipped. We (Canada) had no debt before all this went on, today our national debt too is at historic levels and it's doubtful that our fiscal budget will be balanced before 2015. With the exception of infrastructure expenditures, which were over due and well worth the commitment, we too spent billions of dollars tossed to the wind in the name of "stimulus".

    But Todd, wasn't there a huge commitment to stimulus spending by GWB before Obama took office? At the beginning I think we were all told that this was critical to saving the world economy...


    Best regards, Brian.
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    PookyNR is offline 3D VIP 2005, '06, '07, '08, '09, '10, '11, '12, '13, '14
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    Quote Originally Posted by Brian Shillito View Post
    I'm afraid that this was a pill which many countries chose to swallow with "questionable" results for all those who chipped. We (Canada) had no debt before all this went on, today our national debt too is at historic levels and it's doubtful that our fiscal budget will be balanced before 2015. With the exception of infrastructure expenditures, which were over due and well worth the commitment, we too spent billions of dollars tossed to the wind in the name of "stimulus".

    But Todd, wasn't there a huge commitment to stimulus spending by GWB before Obama took office? At the beginning I think we were all told that this was critical to saving the world economy...
    Both sides of the political spectrum in both Canada and the USA have been indoctrinated in this pseudo-Keynesian economic idea set. The notable exception was those of the Libertarian persuasion. These ideas are an easy answer - especially when there is no intelligent creativity or political will to think outside of the 'spend ourselves to self-destruction' paradigm.
    Am I the only one without a small type signature?

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    Quote Originally Posted by Brian Shillito View Post
    But Todd, wasn't there a huge commitment to stimulus spending by GWB before Obama took office? At the beginning I think we were all told that this was critical to saving the world economy...
    Best regards, Brian.
    I think you are referring to TARP.

    http://en.wikipedia.org/wiki/Trouble...Relief_Program

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    As with anything born and bred in DC, the idea may actually have had merit at one time, but the implementation set new records for inefficiency, foolish regulation, and sheer bureaucracy for its own sake.
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    Quote Originally Posted by Brian Shillito View Post
    But Todd, wasn't there a huge commitment to stimulus spending by GWB before Obama took office?
    TARP was totally different than the "Stimulus Plan". The Democrats, along with Obama, Biden, Romer, Pelosi, Reid, et.al, had 100% ownership of the "Stimulus Plan" and its earmarks and promises to keep unemployment below 8%... As can be traced in the article, it was an epic failure.
    Todd Robbins
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    Quote Originally Posted by Wireline View Post
    As with anything born and bred in DC, the idea may actually have had merit at one time, but the implementation set new records for inefficiency, foolish regulation, and sheer bureaucracy for its own sake.
    Unfortunately, the idea never had merit. These same policies have been used by other nations. And as history shows, they are always disastrous. Deficit spending to stimulate the economy along with deflation of the currency is a poor (pun intended) short term fix that exacerbates a long term problem. You just can't sustainably spend more money than you earn.
    Am I the only one without a small type signature?

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    Tommy Yonley is offline Gold Club Member (1000+ posts)
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    Quote Originally Posted by PookyNR View Post
    Keynesian economics never works well. Short term gain for long term pain. Mind you, I think if Keynes himself saw how some of his preachers have been applying his thoughts and crediting him, he wouldn't be too happy.
    I certainly don't know much about economics, but the thing which strikes me as amazingly dumb is idea of a "Keynesian multiplier" (where the multiplier value is presumed to be greater than 1). I just don't see where the magic can happen by which the government can spend $1 in stimulus, and get more than $1 in economic activity from it. If you just think about the $1 which the government gives in isolation--sure that dollar might (in principle) lead to $1.50 in economic activity (that is, if the government was actually smart about how it spent the money). However, what is forgotten is where the original dollar came from; the government had to take that dollar away from someone else. It is like trying to fill a bucket by taking water from one side of the bucket and pouring it into the other side.
    Last edited by Tommy Yonley; 07-06-2011 at 02:07 AM.

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    Quote Originally Posted by Tommy Yonley View Post
    I certainly don't know much about economics, but the thing which strikes me as amazingly dumb is idea of a "Keynesian multiplier" (where the multiplier value is presumed to be greater than 1). I just don't see where the magic can happen by which the government can spend $1 in stimulus, and get more than $1 in economic activity from it. If you just think about the $1 which the government gives in isolation--sure that dollar might (in principle) lead to $1.50 in economic activity (that is, if the government was actually smart about how it spent the money). However, what is forgotten is where the original dollar came from; the government had to take that dollar away from someone else. It is like trying to fill a bucket by taking water from one side of the bucket and pouring it into the other side.
    Yes. It's deceptive when trying to apply the multiplier principle against debt or even worse, deflated dollars. It just doesn't work.

    Where it does work is with key industries like agriculture. The Weimar Republic was able to work its way out of hideous debt in decade by monetizing the agriculture industry. They knew that $1 dollar of activity in agriculture would circulate through the economy at least seven times.
    Am I the only one without a small type signature?

    Nathan

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