That 13,665,926,643,255 number is the dollar amount that we, as American citizens, now owe to pay for all the spending that we demanded from the politicians that we elected. If you have a problem sorting through all those digits, that number is around $13.7 trillion. It doesn't look so bad when you write it like that.
"New numbers posted today on the Treasury Department website show the National Debt has increased by more than $3 trillion since President Obama took office. The National Debt stood at $10.626 trillion the day Mr. Obama was inaugurated. The Bureau of Public Debt reported today that the National Debt had hit an all time high of $13.665 trillion. The Debt increased $4.9 trillion during President Bush's two terms. The Administration has projected the National Debt will soar in Mr. Obama's fourth year in office to nearly $16.5-trillion in 2012. That's more than 100 percent of the value of the nation's economy and $5.9-trillion above what it was his first day on the job."
It is not like we are not getting value for all that debt. We are paying for at least two wars, subsidizing the defense of Japan, Germany, and South Korea, policing the world, and attempting to rebuild several Mideast nations in our image.
Additionally, since coming into office, this administration and the One Party Democratic Rulers that we (meaning you) elected thought it important to step up the spending and borrowing because they decided our government needed to fund:
Large increases in public sector jobs while private sector jobs are lost during a recession
A record historically ginormous pork filled stimulus plan that does not stimulate.
Taking over a corrupt bankrupt insurance company and two bankrupt car companies.
Paying down and subsidizing risk the mortgages of people who cannot afford the houses they bought at wildly overpriced levels in a bubble (caused by government policy distorting the housing market by pumping dollars into home ownership for everyone).
Bailing out the banks that made the bad home loans by investing in pools of securitized mortgage instruments that hold the bad loans (not to mention the Fed loaning banks money for free).
A trillion dollars in new spending on a "reform" health care bill that does not control health care costs, does not cover everyone, is not paid for, and no one understands (least of all the Democratic legislators who steamrolled it over GOP opposition).
For most people, this looks like a pretty easy equation. A massive increase in irresponsible unfunded spending over the last two years resulted in massive record setting increases in the deficit over the same two years. It looks superficially as easy to understand as 2 + 2 = 4. But that would be wrong. You see this is actually an example of "scared voters not thinking clearly".
To correctly understand what is happening requires the sophistication and big brains of a liberal Nobel prize winning economist. Paul Krugman is the man for the job. He explains that to understand this spending correctly, you need to consider the spending within the context of a completely imaginary GDP that is much larger than the one that is - you know - here with us on Earth, in the actual U.S. of A. in what we like to call - reality. Then he completely throws out several categories of spending where some of the biggest increases took place, and Ouila!Obama is a positively parsimonious small spender!
"Clearly, while Republicans have been somewhat irresponsible in running up debt, Democrats have managed to be almost three times worse than Republicans. Just as clearly, they have no intention to cut spending to correct this, but instead plan to hike taxes to fund their spending spree. And they’re being led by a President who wants to spend even more, as his own budget projections show."
President Obama was in Milwaukee on Labor Day and kicked off the fall political season by introducing his fire-breathing stem-winder stump speech for the fall campaign. As happens occasionally when a politician gets on a roll in front of a friendly crowd, the President took a short detour off message. Here he channels Jimi Hendrix to take a shot at his critics, saying "They talk about me like a dog."
As soon as he said it I thought - He's going to regret that.
While that sound bite got most of the media attention, the real meat on the bone of that speech was President Obama's announcement of a new $50B+ infrastructure spendingstimulus development program. Some highlights:
"....as part of the largest new investment in America's infrastructure since President Eisenhower built the Interstate Highway System... jobs rebuilding our crumbling roads, bridges, and schools, repairing our faulty levees and dams, connecting nearly every American to broadband, and upgrading the buses and trains that commuters take every day... we will be investing $28 billion in our highways, money that every one of our 50 states can start using immediately to put people back to work.. the jobs that we're creating are good jobs that pay more than average; jobs grinding asphalt and paving roads, filling potholes, making street signs, repairing stop lights, replacing guard rails..." "We also have to build a new foundation for our future growth. Today, our aging system of highways and byways, air routes and rail lines is hindering that growth. Our highways are clogged with traffic, costing us $80 billion a year in lost productivity and wasted fuel... we're talking about is a vision for high-speed rail in America... I'm announcing my administration's efforts to transform travel in America with an historic investment in high-speed rail... The Department of Transportation expects to begin awarding funds to ready projects before the end of this summer, well ahead of schedule." - President Barack Obama - March 3, 2009 and April 16, 2009.
Wait! My mistake. Those excerpts were from a couple of speeches the President made announcing the benefits of the $787 billion$862 billion somewhere north of $1 trillion (fully loaded) stimulus legislation passed in February 2009. Apparently that bill was about $50 billion dollars short. Easy mistake. It was a big bill, nobody really read it. It would be easy to forget an additional $50 billion dollars or so. Could happen to anyone. Fortunately the administration is correcting that oversight now. For some insight into what this extra $50 billion dollars of not-a-stimulus infrastructure spending will get us now - excerpts from the the Milwaukee Labor Day speech:
"I am announcing a new plan for rebuilding and modernizing America’s roads and rails and runways for the long term. I want America to have the best infrastructure in the world. We used to have the best infrastructure in the world. We can have it again. We are going to make it happen. Over the next six years, over the next six years, we are going to rebuild 150,000 miles of our roads -– that’s enough to circle the world six times. That’s a lot of road. We’re going to lay and maintain 4,000 miles of our railways –- enough to stretch coast to coast. We’re going to restore 150 miles of runways. And we’re going to advance a next-generation air-traffic control system to reduce travel time and delays for American travelers...We’re going to continue our strategy to build a national high-speed rail network that reduces congestion and travel times and reduces harmful emissions... this will not only create jobs immediately, it’s also going to make our economy hum over the long haul." - President Barack Obama - September 6, 2010
I'm not the only one who had a deja vu experience watching his performance:
No, President Obama is not a dog. He is a one trick pony unicorn. For this administration there is exactly one answer to every problem. Spend more. Raise taxes to pay for new spending. Spend more. Borrow more to pay for new spending. Spend more. Every problem is a nail, spending is the hammer that the administration wields as every solution. So what if ARRA (the biggest spending program in US history until HCR a year later) did not stimulate the economy as expected? No problem - get a bigger hammer, because obviously, even more spending is the right answer this time.
Look, the problem with the President's newer bigger spending hammer, is not that he is spending on infrastructure per se. As I said at the time of the original porkulus, if you are going to do a stimulus program, funding needed infrastructure is the right way to do it:
"It is incumbent on our Federal government to help cushion the blow for those Americans devastated by this economic contraction. That includes unemployment extensions such as are in the stimulus bill. If there are infrastructure projects that we know we really need, like upgrading the electric transmission backbone, and repairing dangerous bridges, there is certainly a case to be made to do the projects now and cushion the recession impact. Fine. I’m on board. The operative word being “need”. But to spend a trillion dollars, just for the sake of spending a trillion dollars,just because some economists and politicians have an unproven dogmatic ideological belief in Keynesian theory, or - more likely - using unproven Keynesian theory as an excuse to load up a porker the likes of which we have never seen before - strikes me as batshit insane."
As Rachel Maddow points out, many Republicans complained that the 2009 ARRA porkulus legislation did not contain enough infrastructure spending. She is correct that the Republicans are playing politics now, just like the President and Democrats are playing politics now by pushing new programs before the election. Everyone understands that two months before the election, this is par for the course. But I have a solution that will get bi-partisan support if the administration is sincere about this program.
Since (as clearly indicated by the President on Monday) the monstrous ARRA stimulus legislation did not have the right mix of infrastructure spending (if it did - why would we need a new program less than two years later?) - then the solution is not to spend new money, but instead to fix the stimulus. If the Democrats believe they did the right thing ramming the ARRA stimulus package through - let it play out. But if it was wrong and we need this infrastructure, then reallocate the remaining unspent $200+ billion in the stimulus package to pay for the needed infrastructure. That is an approach that might elicit bipartisan cooperation - even during the election season. But the exact wrong answer for the the administration and the country, is to pile on new spending.
The administration is reported to be in a panic about the recent polls on the mid-term election. Given that focus, given the politcal acumen of Rahm and Axelrod, it is astonishing that they are so tone deaf to the message being delivered by the electorate. Let me help:
The House of Representatives voted to provide an emergency $2 billion for the “cash for clunkers” program on Friday, and the White House declared the program very much alive, even though car buyers appear to have already snapped up the $1 billion that Congress originally appropriated.
Refresh my memory. When exactly did Congress decide the word “emergency” means “popular with voters”?
As promised, DWSUWF is following up on an earlier post regarding the potential Pacifica "Pipeline to Nowhere." First, know that your loyal blogger fully understands that in the greater scheme of things, $2m of stimulus funds is less than a drop in the gigantic porkfest bucket that is the Obama Stimulus plan. But... having noticed a potential issue for a local project that has not received much attention, I feel I should try to ensure that at least this one little $2M drop of taxpayer funds does not get wasted.
Work with me here... this is going to be a deep dive into the weeds of this one stimulus project. I will make this as clear and concise as I can.
The Project Here is the project as described on the Department of the Interior "Recovery Investments" website:
Pacifica Recycled Water Project - Pipeline, North Coast County Water DistrictPacifica, Calif. Reclamation ARRA Funding: $2,203,750 Total Project Cost: $8,815,000 Local Contact: Kevin O’Connell, Project Manager Funding will be used to construct new facilities including 3.5 miles of pipeline, a 400,000-gallons storage tank and a new pump station. The project will provide recycled water to irrigation users that currently draw water from the Hetch Hetchy Regional Water System, and thereby reduce users’ dependence on existing potable water supplies.
So we have an $8.8 million water pipeline project, of which $2.2 million will come from stimulus funds. We learn from a San Mateo County Times article that the remaining cost will be split between the San Francisco Public Utilities commission and the North Coast Water District using low interest construction loans from the State of California. It should be noted that bothmunicipalities, the county and the state are facing enormous budget shortfalls and have no money to waste. We also learn from the article that 78% of the water flowing through the pipeline will be used to irrigate the Sharp Park Golf Course. The course is currently being irrigated with water from the Hetch Hetchy reservoir with good potable water that can be better used elsewhere.
So far so good. Regardless of ones political posture on the stimulus package itself, and unlike a lot of the pork, waste and just plain stupid expenditures emerging from the Recovery.gov website, this project clearly meets the criteria of what the stimulus package was promoted to accomplish. It is an infrastructure construction project. It will create 275 jobs. It helps relieve the growing pressure on the San Francisco Bay area watershed. It's recycling water during a drought. It is a needed project. What's not to like?
The Problem Sharp Park Golf course is located in Pacifica but owned by the city of San Francisco. Legislation has been introduced in San Francisco (Item 090329) to close Sharp Park and turn it into a nature preserve in order to protect an endangered garter snake and frog (both of which have lived in harmony on the course property for 70 years).
The SF Board of Supervisors is currently awaiting a study due at the end of the month, and will then decide the fate of Sharp Park. Common sense dictates that a simple plan be developed to insure the golf course continues to operate in harmony with the red leg frog and the garter snake. That would make perfect sense. But we are talking about the San Francisco Board of Supervisors, egged on by well funded extremist eco-bullies, so - no telling what will happen. They could very well close the course.
Here is the point. If the Supes decide to close the Sharp Park golf course, the approved stimulus water recycling project will literally be a "Pipeline to Nowhere. " There will be no reason to waste $2.2 million of stimulus funds and another $6 million of California funds on this project.
The Prescription Common sense dictates that a pipeline project to irrigate a golf course should not proceed if the golf course is to be closed. If there is no commitment by local, state, and federal leaders to the continued operation of the beneficiary of the pipeline (the Sharp Park Golf Course) the stimulus funds should be redirected. Again, this pipeline project is a good project that will help the community, create jobs, save water, and is a good use of stimulus funds, if there is a commitment to the Sharp Park Golf Course. So - what will it take to get that commitment?
This blog has a limited (if loyal) readership. However, I will do what I can to put a spotlight on the potential of funding a "Pipeline to Nowhere." Faced with public embarrassment, public officials will generally take the path of least resistance. In this case that path is a simple rational common sense approach:
Commit to the continuation of the Sharp Park golf course.
Implement procedures at the course to further protect the snake and frog.
Build the pipeline to irrigate with recycled water.
Find a way to inoculate Pacifica and San Francisco against abusive lawsuits from the eco-bullies in Tucson.
For a change, why not try to solve this problem before the money is wasted? To that end, over the next 24 hours I will be forwarding versions of this message to the following officials and organizations:
Feel free to chime in. I'll also try to get some reporters, and other blogs interested.
To borrow a phrase from the Bravo Channel - let's see what happens. UPDATE: Pacific Riptide has been covering the pros and cons from a Pacifica perspective. They have a link to a video of Mayor Julie Lancelle recounting the history of this political battle to local Democrats last Saturday . She is fighting the good fight. Pacifica is lucky to have her as mayor.
"PACIFICA — A local water treatment plant will soon be piping 50 million gallons of treated, recycled water to the Sharp Park Golf Course and other sites in Pacifica thanks to a $2.2 million grant from the federal government. The North Coast County Water District, which serves potable water to Pacifica and part of San Bruno, got word last week that a shovel-ready project 10 years in the making had been greenlit by the grant, paid for by the federal stimulus package... The SFPUC will use 78 percent of the water to irrigate Sharp Park (the golf course is in Pacifica but owned by San Francisco) and therefore owes a larger part of the debt."
Just one little glitch - the city of San Francisco is hell bent on closing the course:
"Supervisor Ross Mirkarimi introduced legislation (see item 090329) aimed at turning the Sharp Park Golf Course in Pacifica into a biological reserve, much to the dismay of golfers and Pacifica city leaders. The venerable course, which opened in 1931 was designed by famed architect Alister Mackenzie and landscaped by John McLaren, is actually owned by the City and County of San Francisco despite sitting squarely within the City of Pacifica."
As an enthusiastic patron of the local public golf courses, I have been following the San Francisco Golf Wars with a rooting interest. Generally I would not post a local story on this blog, but with stimulus dollars now literally being showered on the golf course, the story does take on a national flavor. This is not a done deal. We are awaiting the results of a study designed to impartially validate and rationalize the pre-determined conclusion of the board of supervisors. To whit - demolishing a historic landmark to protect endangered species that have been quite happy living under the stewardship of the self-same golf course for the last 75+ years.
I sure hope those endangered frog and garter snakes are real thirsty, because they are about to get a lot of very expensive water. One wonders if the stimulus bill watchdog - Joe Biden, knows that taxpayer dollars are being spent to irrigate a golf course that may soon not exist? I wonder if Mayor Gavin Newsom and the San Francisco Supervisors will be in as much of a hurry to close this course if local stimulus dollars and jobs hang in the balance? Stay tuned...
Wherein we take a stroll down the metaphorical beach of the DWSUWF blog and note the detritus that has washed ashore and cluttered our little island of rationality in the great big blogospheric ocean. The beach is particularly messy now as we have neglected it for a few months. Your loyal blogger was distracted, spending time touring foreign lands and working on other projects.
While not a comprehensive cleanup, permit me to point out a few of the shiny items washed up on the beach.
Yes, back at the lab, GM and Chrysler continue to be fed intravenously at the Obama intensive care unit. They will continue to live for exactly as long as they stay on taxpayer life support and not one minute after (if?) the plug gets pulled. To the surprise of no one, it is now certain that the taxpayer "loans" to GM and Chrysler (as they were characterized by the President) will never be repaid.
But it is a relief to know that they don't want to run the car companies.
ITEM - Guantanamo in da moonlight. I'll be heading to the Upper Peninsula of Michigan next week for an annual fishing holiday at our family camp. An ex-governor recently suggested that the U.P. would be a good home for any remaining detainees when Guantanamo is finally closed. Michigan headline writers are having a field day with this idea. [NOTE: It occurs to me that in order to appreciate this headline, one must be familiar with the straight-to-video, widely ignored Jeff Daniels cult comedy classic "Escanaba in da moonlight"]
Detroit Free Press "How about Michigan, for a change, solving a problem for the U.S. government, instead of the other way around?That's one way to look at an idea floated recently by former Gov. John Engler to offer the Upper Peninsula, already home to a dozen state prisons, as a place to move the 200 or so enemy combatants and terror suspects now housed in a camp at Guantanamo Bay, Cuba. President Barack Obama intends to close Guantanamo, just as soon as the administration figures out what to do with the prisoners there, a knotty problem considering they may include some of the most dangerous people on the planet..."
Move Gitmo to da UP, eh By Ed Brayton "Former Michigan Gov. John Engler has an interesting idea to bring some revenue into Michigan: Turn the UP into Guantanamo Bay North... Not an idea that Michigan political leaders are likely to get behind."
Al Qaeda, eh? "Former Michigan Governor John Engler suggested last week that the more than 200 prisoners currently housed at the soon-to-be-closed Guantánamo Bay, Cuba prison be relocated to to the Upper Peninsula. We certainly could use the money and people actually moving into Michigan to live would be big news.
Which would be fine until winter arrived, when a UP prison would run afoul of the Obama Administration's prohibition against torture"
Hey - If it moves some money and jobs to the UP... why not, eh? ITEM - Obama is committed to fiscal restraint - BWAHAHAHA. Honest to God - I mean how f***ing stupid does the administration think the American people are? Obama actually had the unmitigated gall to call a press conference and say this with a straight face:
"We can no longer afford to spend as if deficits do not matter and waste is not our problem," he said in his formal remarks. "We can no longer afford to leave the hard choices for the next budget, the next administration or the next generation."
"To date, the president's rhetoric exceeds his results. He has long said he would require his team to scrub the budget "line by line" for savings. Thursday's release is the product of that review, though an administration official was careful to call it "only a step in the process" of dealing with the deficit problem.. In reality, in the short term, deficits do not matter much to the administration. His aides would say that's justifiable given the scale of the economic recession that greeted them in January. They have decided to spend freely to jump-start the economy and to reduce the resulting deficits later. An attack on government waste, as necessary as that may be, cannot solve the problems he is helping to create."
Maybe you can fool most of the people all of the time.
This video from Stop Spending Our Future presents the reality of our current situation with a great deal more clarity than our president would like you to understand. Keep away from open windows and hide sharp objects before viewing:
We are doomed.
ITEM: Happy belated birthday to me! While we were away, the third anniversary of the DWSUWF blog passed without fanfare. DWSUWF was born on April 23, 2006 in the service of promoting a voting heuristic of divided government in order to secure better governance and more fiscal responsibility out of our leaders in Washington.
Our first anniversary was noted here as we celebrated the reestablishment of divided government in 2007, which began paying dividends immediately. In our second anniversary [linked here] we were looking forward - hoping against hope that the benefits of divided government could be maintained across the November election. Alas, our third anniversary was ignored, as I was instead golfing in a faraway land, and enjoying exotic food and drink. While I played, our country continued its headlong plunge into mind-numbing, ruinous levels of debt that can never be serviced, never be repayed, and with terrifying consequences we have yet to experience. The deadly effects of single party rule has once again taken its toll.
We are not really getting older, we are just getting more cynical, more pessimistic and borderline catatonic in the face of this economic horror.
"Eat drink and be merry my friends, for tomorrow we die".
Wherein we take a stroll down the metaphorical beach of the DWSUWF blog and comment on the detritus that has washed ashore and cluttered this little island of rationality in the great big blogospheric ocean. Today, rummaging through our shiny new blogroll, we found...
ITEM - Be Afraid. Be Very Afraid.
The economy is very bad. No doubt about it. But how does this recession compare to past recessions? Last week a graph was released by the office of Speaker of the House Nancy Pelsoi that was truly frightening:It was widely distributed across the blogosphere, particularly favored by left-of-center blogs. Frankly, you couldn’t design a graphic that would better serve to instill fear about the state of the economy. In fact, it was apparently designed to do just that, by truncating the left scale to emphasize the difference in the three compared recessions, using absolute unemployment numbers rather percentage of the workforce, and pretending that history began in 1990.
The following graph offers a somewhat broader perspective, comparing all recessions in the modern era (since 1946), expressed as an unemployment percentage.
The green bar is the current recession. No doubt, this is a bad one. About in the middle of pack as far as recessions go. The graphic points out an interesting aspect of recessions. They all end. And, surprisingly, they didn’t all need a trillion dollar stimulus bill from the Feds to end them. In fact, all of them combined up to now did not need a trillion dollar stimulus to end. McQ and QandO has a few more charts that show the same thing. A bad, but not wildly extraordinary recession. Worst than most, but not as bad as others we have weathered since WWII.
It is incumbent on our Federal government to help cushion the blow for those Americans devastated by this economic contraction. That includes unemployment extensions such as are in the stimulus bill. If there are infrastructure projects that we know we really need, like upgrading the electric transmission backbone, and repairing dangerous bridges, there is certainly a case to be made to do the projects now and cushion the recession impact. Fine. I’m on board. The operative word being “need”.
But to spend a trillion dollars, just for the sake of spending a trillion dollars, because some economists and politicians have an unproven dogmatic ideological belief in Keynesian theory, or - more likely - using unproven Keynesian theory as an excuse to load up a porker the likes of which we have never seen before - strikes me as batshit insane.
Nancy's graph served its purpose and helped the President sell us on the fear of a pending catastrophe so great we really need to be stampeded into the largest spending bill in the history of the United States. That the financial disaster is so great we really should not care that there is massive spending in this bill for projects that we do not need and will not actually stimulate the economy (translation of “the bill is not perfect“). That the impending crisis is so monstrous, that we cannot afford to take the time to make sure our money is not wasted, thereby guaranteeing, that we will waste more money with this bill than any other bill in history.
ITEM - Last fall's banking crisis was also so frightening that Congress did not have time to carefully consider the $700B TARP bill before throwing that money at Wall Street.
And here is one congressman explaining exactly why it was so frightening, in yet another meme that took the blogosphere by storm this week.
One problem with Congressman Kanjorski's entertaining story. It was not quite true.
The part that grabbed everyone's attention, was Kanjorski claiming that there was a two hour $550 billion drawdown in money market funds last fall, essentially a "run on the bank" and that the global economic system was within 24 hours of complete collapse. This story has been used in blogs as justification for Congress abrogating their responsibility to carefully consider and debate how our money is raised, allocated and spent. Oh… and also for some gratuitous bashing of free markets. One example:
“For those of you who didn’t realize how dire the situation was (even though I implored you to take it seriously) I hope this video will make it crystal. If our banking system failed and it set off a chain reaction around the world, our credibility would have been TOAST… Letting the market work would have literally resulted in almost a complete unraveling of our way of life. Imagine if you had woken up the next day and discovered that your debit card, your credit cards… none of them worked. It would have been catastrophic.”
I thought the story was a bit fishy when I suddenly started seeing this clip all over. Why is it that the only source is one Congressman in an obscure CSPAN video clip? Where was the substantiation from… well… anyplace else? How is that anything so big and dire could take place last September, and nothing leak out about it until now? My suspicion was correct.
Kanjorski and the Money Market Funds: The Facts
“With the Kanjorski Meme still spreading (see Ben Smith, Andrew Leonard, Moldbug, and more), I think I’m finally able to squash it with some hard figures: there never was a $500 billion outflow from any asset class in the space of a couple of hours or even weeks, and the Fed never shut down or froze any money-market accounts. This is not the first time that Kanjorski has made these allegations. But first, it’s worth going through the timeline…
on September 24, Kanjorski held a hearing on Capitol Hill with Treasury secretary Hank Paulson… Kanjorski is clearly fishing here: he’s talking about anonymous newspaper reports and vague “conversations” and anonymous Wall Street “friends”, and basically asking Paulson to confirm his suspicions. Which, naturally, Paulson doesn’t do, because the suspicions weren’t actually true. That said, however, Paulson’s being-polite-to-the-Congressman answer doesn’t explicitly say that Kanjorski’s numbers are false. After that, we didn’t here much more about this meme until Kanjorski resuscitated it on C-Span, this time citing the Federal Reserve as his data source, and beefing up the numbers for good measure…
…This is all, frankly, fiction, and it’s not clear where most of it came from, although maybe Kanjorski’s “friends” on Wall Street are the same people as Michael Gray’s sources at the New York Post. Thinking back to that crazy week it’s easy to get details wrong, especially when you’re speaking off the cuff on a call-in show. But let’s stop treating it as though there’s any substance to it. Please.”
So Kanjorski “misremembered” his sources as he told and retold the story over time, and as a consequence, bad reporting from the New York Post is given new life on the Intertubes.
That was indeed a very bad week for the financial sector. But there was no retail panic in money markets, no $550B drawdown in a couple of hours and the worldwide financial system was not 24 hours from collapse. Good story though. Kanjorksi enjoys telling it.
There are still questions and lessons to be learned. My question: To what extent did the Treasury Secretary and the executive branch permit misinformation and fear to be used to panic the Congress into abrogating their responsibilities to the American taxpayer and pass a very bad bill with very little consideration?
ITEM - The Stimulus Bill just passed the Senate.
Beyond this, I cannot add much to my last post on this subject. I just think it is worth pointing out that none of our representatives in either the House or the Senate actually have any idea whatsoever about what is really in this bill. It is impossible for anyone to have readthe final version that was voted on today. The final 1,000+ page bill was given to the legislators at 9:00 AM this morning, and passed tonight.
What a hairball. Your government in action.
ITEM - Carnivalingus
Some recent collections of high quality blogging punditry:
UPDATED: 10-Feb-09 Shortly after the election, while basking in the afterglow of the historic outcome, I - like many proud Americans - watched Steve Kroft interview the new first family on 60 Minutes. I was struck by one particular statement made by the president-elect, and even highlighted it in a post at the time:
Kroft: "Where is all the money going to come from to do all of these things? And is there a point where just going to the Treasury Department and printing more of it ceases to be an option?"
Mr. Obama:"Well, look, I think what’s interesting about the time that we’re in right now is that you actually have a consensus among conservative Republican-leaning economists and liberal left-leaning economists. And the consensus is this: that we have to do whatever it takes to get this economy moving again, that we’re gonna have to spend money now to stimulate the economy. And that we shouldn’t worry about the deficit next year or even the year after. That short term, the most important thing is that we avoid a deepening recession."
What made the statement remarkable, is that it was patently, demonstrably, unequivocally untrue. No such consensus existed among economists - not then - not now. If we were still in the heat of a political campaign, partisans might have seen fit to call it a blatant bald-faced lie. If Bush had uttered it, it would have been cited as yet another example of his pathological inability to recognize the truth, his propensity to ignore reality. But a new President deserves the benefit of the doubt, so let us just call it an exaggeration for effect.
At the time I considered consulting the intertubes and dragging up quotes from a few dozen economists to contradict the assertion, But, I was feeling lazy, and as he had only been elected a few days before, had not been sworn in, and we had not even really started the honeymoon yet, I couldn't be bothered. My only editorial comment in that post was a reminder that someone (our children and grandchildren), someday would have to pay the price for this additional debt, in either taxes, inflation, devalued currency or all of the above.
Since then, as the massive stimuluspork laden spending bill took shape, the same statement was repeated in various forms by Obama, by surrogates and by the Democratic leadership. Over the weeks and months, the statement morphed, becoming even more assertive, more arrogant, more imperious and by extension more untrue:
"Economists from across the political spectrum agree that if we don't act swiftly and boldly, we could see a much deeper economic downturn that could lead to double-digit unemployment and the American dream slipping further and further out of reach." - Barack Obama 3-Jan-09 "Every economist from right to left, Republican, Democrat, advises that (a government stimulus) has to be a very substantial package" Rep. Steny Hoyer (D) 4-Jan-09
"Everybody, I think, from economists on the left to economists on the right realize that we must make critical investments at this time," - White House chief of staff Rahm Emanuel 18-Jan-09 "There is no disagreement that we need action by our government, a recovery plan that will help to jumpstart the economy." — Barack Obama 09-Jan-09
The odd thing, is that Obama appeared to actually believe it, as if by repeating it often enough it would become true. It was becoming an ideological canon of Democratic dogma, chanted at every opportunity.
Last week, my procrastination paid off, as the Cato Institute published a full page ad [PDF] in the New York Times to set the record straight (and make this post a whole lot easier):
"With all due respect Mr. President, that is not true. Notwithstanding reports that all economists are now Keynesians and that we all support a big increase in the burden of government, we do not believe that more government spending is a way to improve economic performance. More government spending by Hoover and Roosevelt did not pull the United States economy out of the Great Depression in the 1930s. More government spending did not solve Japan's "lost decade" in the 1990s. As such, it is a triumph of hope over experience to believe that more government spending will help the U.S. today. To improve the economy, policy makers should focus on reforms that remove impediments to work, saving, investment and production. Lower tax rates and a reduction in the burden of government are the best ways of using fiscal policy to boost growth."
They also offered a very nifty little widget to promote the ad, which is now running in the left sidebar.
This almost gives me hope. I'd like to believe that something has fundamentally changed. I'd like to believe that people have stopped believing the fairy tale that government intervention in the form of massive new spending and massive new debt that can only be funded by printing money is somehow a solution to the problem of a burst economic bubble created by government intervention in the form of massive spending, massive debt, and easy monetary policy.
Encouraging, but I don't believe it. This is all Kabuki theater. After applying a little lipstick, this pig of a bill will pass (H/T to Q&O for the graphic). To satisfy the constituents of conservative Democrats and Republicans, the bill must be voted down once, just so Senators can run an ad in their next campaign saying they voted against waste in Washington. Then the deck chairs will be rearranged and a bill of comparable size and scope will sail through. The same Senators can then also run an ad saying they saved the economy, and brought home the bacon.
"McConnell's change in attitude seems suspiciously unprincipled and mostly partisan. I'm all for divided government (here's hoping it delivers gridlock), but one of the problems with unprincipled pols is that, well, they don't have principles. Which means they will flip the moment they get enough goodies promised them to go one way or the other. And if the experience with the financial sector bailout is any indication, expect the second (and third, and fourth, and so on) bills to be even worse than the awful first draft. And expect McConnell sometime soon to be on the other side of the vote, the one with all those shiny, happy Democrats yapping about how they just guaranteed a car in every pot and two chickens in every garage by funding bullshit infrastructure programs in every ZIP code in the country."
One thing has changed. President Obama is no longer asserting that there is no credible opposition to a massive federal fiscal stimulus. He is taken a different tack now. In Wednesday's briefing with Treasury Secretary Tim Geithner, Obama's tough sounding but ultimately meaningless eyewash on limiting Wall Street executive compensation got all the press. The real message was this quote:
"Now, in the past few days I've heard criticisms of this plan that echo the very same failed theories that helped lead us into this crisis -- the notion that tax cuts alone will solve all our problems," the president said at the White House. "I reject that theory, and so did the American people when they went to the polls in November and voted resoundingly for change."
Here is the entire 10 minute event from the White House. The quote above occurs at 4:42:
The point: No more pretense that credible opposition to this insane spending plan does not exist. The new message? Something like this...
My overwhelming 52% electoral mandate means that Americans want to flush another trillion dollars that we don't have down the toilet. Because I say so. No matter what that Rasmussen poll says.
And you know what?
He is probably right.
Pucker up.
UPDATE: 05-Feb-09Apparently the portion of Obama's comments not related to executive pay yesterday got repackaged and regurgitated into a Washington Post op-ed today - The Action America Needs. Compare this quote from the op-ed to his White House comments yesterday (quoted above):
"In recent days, there have been misguided criticisms of this plan that echo the failed theories that helped lead us into this crisis -- the notion that tax cuts alone will solve all our problems; that we can meet our enormous tests with half-steps and piecemeal measures; that we can ignore fundamental challenges such as energy independence and the high cost of health care and still expect our economy and our country to thrive. I reject these theories, and so did the American people when they went to the polls in November and voted resoundingly for change."
I guess you can't really plagiarize yourself. Same old stuff. Pay no attention to the content (massive pork) in the bill. Pay no attention to the fact that it will not solve the root problem and will at best delay a day of reckoning. Pay no attention that it will add a trillion dollars of debt that we do not have and will have to borrow from the Chinese or tax from Americans or devalue the currency to repay. Just pass it, because an economic fear-mongering President says it should be passed.
Did we learn nothing from the hastily passed $700 Billion Wall Street bailout last year? You remember - when we witnessed the rampant stupidity of a craven congress rolling over to an executive demand for fast action on the basis of economic fear mongering - and as a result - were treated to the spectacle of our representatives wasting massive amounts of taxpayer resources without really understanding what they are passing or having any idea where the money will go or how it will be used.
Apparently we learned nothing. This is exactly what is happening on the floor of the Senate as I write this.
As predicted: Unable to pass a $900 Billion massive pork-laden stimulus spending package that will do nothing except spend money we do not have on stuff we do not need, wildly increase the debt burden on future generations, and ultimately require devaluation of the dollar - the Democrats are in the process of paying off a couple of Republican Senators with a share of the pork, and will likely pass a $800 Billion massive pork-laden spending package that will do nothing except spend money we do not have on stuff we do not need, increase the debt burden on future generations, and ultimately require devaluation of the dollar.
UPDATE: 10-Feb-09The Senate just passed their version of the stimulus bill. I'll have some thoughts on this abomination as it wends its way through the conference process over the next week. In the meantime, this YouTube dramatization of the passage of the bill pretty much sums up exactly what just happened. Ned Beatty gives an Oscar worthy performance as the American taxpayer. The other two characters in this clip are playing the United States House of Representatives and Senate.
That 13,665,926,643,255 number is the dollar amount that we, as American citizens, now owe to pay for all the spending that we demanded from the politicians that we elected. If you have a problem sorting through all those digits, that number is around $13.7 trillion. It doesn't look so bad when you write it like that.
CBS Reports: National Debt Up $3 Trillion on Obama's Watch
It is not like we are not getting value for all that debt. We are paying for at least two wars, subsidizing the defense of Japan, Germany, and South Korea, policing the world, and attempting to rebuild several Mideast nations in our image.
massive increase in irresponsible unfunded spending over the last two years resulted in massive record setting increases in the deficit over the same two years. It looks superficially as easy to understand as 2 + 2 = 4. But that would be wrong. You see this is actually an example of "scared voters not thinking clearly".
