Joe Biden on the stimulus: There's still a 30% chance we're going to get it wrong
Biden couches his statement as "if we do everything right," there's still a 30% chance we're going to get it wrong.
But the truth is that the administration isn't even trying to "do everything right." Nobody in their right mind thinks that pouring out a trillion taxpayer dollars into every liberal special interest known to man will help the economy. The Congressional Budget Office has confirmed that the so-called "stimulus" will be harmful over the long haul. Even commentators on the left implicitly admit that this "stimulus" bill is about as likely to be successful as playing a roulette wheel -- and that is putting it as charitably as it can be put.
Obama has said all along that he wants to "jolt" the economy. I believe he does. He wants to jolt the economy so badly that liberal Democrats have an opportunity to put creeping socialism in its place. And he's well on his way.
Update: Also relevant to the topic at hand: Mark Steyn:
A president doesn't have to be able to walk on water. But he does have to choose the right crew for the ship, especially if he's planning on spending most of his time at the captain's table, schmoozing the celebrity guests with a lot of deep thoughts about "hope" and "change." Far worse than his Cabinet picks was President Obama's decision to make the "stimulus" racket the all-but-sole-priority of his first month and then outsource the project to Nancy Pelosi, Barney Frank and Harry Reid.
Appearing on "The Rush Limbaugh Show" last week, I got a little muddled over two adjoining newspaper clippings – one on the stimulus, the other on those octuplets in California – and for a brief moment the two stories converged. Everyone's hammering that mom – she's divorced, unemployed, living in a small house with parents who have a million bucks' worth of debt, and she's already got six kids. So she has in vitro fertilization to have eight more. But isn't that exactly what the Feds have done? Last fall, they gave birth to $850 billion of bailout they couldn't afford and didn't have enough time to keep an eye on, and now, four months later, they're going to do it all over again, but this time they want trillionuplets. Barney and Nancy represent the in vitro fertilization of the federal budget. And it's the taxpayers who'll get stuck with the diapers.
. . . . As President Obama warned Tuesday, "A failure to act, and act now, will turn crisis into a catastrophe." If you're of those moonstruck Obammysoxers still driving around with the "HOPE, NOT FEAR" bumper stickers, please note that, due to an unfortunate proofreading error at the printing plant, certain nouns in that phrase may have become accidentally transposed.
As it happens, the best way to ensure catastrophe is to "act now." It would be nice if the world could all prance along in regimented unison like the Radio City Changettes. But, alas, the foreigners made the mistake of actually reading the "stimulus" bill, and the protectionist measures buried on page 739 subsection XII(d) ended, instantly, the Obama honeymoon overseas. The European Union has threatened a trade war. Up in Canada, provincial premiers called it "a march to insanity." Wait a minute, I thought the Obama era was meant to be the retreat from insanity, a blessed return to multilateral transnational harmony.
As longtime readers will know, I'm all in favor of flipping the bird to the global community. But at least, when Rummy was doing his shtick about "Old Europe," he did it intentionally. To cheese off the foreigners entirely accidentally before you've even had your first black-tie banquet is quite an accomplishment. Protectionism is serious business to the Continentals. . . . .
The bloated nonstimulus and the undertaxed nominees are part of the same story. I'm with Tom Daschle: I understand why he had no desire to toss another six-figure sum into the great sucking maw of the federal Treasury. Who knows better than a senator who's voted for every tax increase to cross his desk that all this dough is entirely wasted? Tom and Tim Geithner and Charlie Rangel and all the rest are right: They can do more good with the money than the United States government can. I only wish they followed the logic of their behavior and recognized that what works for them would also work for every other citizen. Instead, they insist that the sole solution to our woes is a record-setting wasteful government spending spree.
. . . . On Wednesday, Salon headlined a story on Obama: "The New Great Communicator … Isn't." Oh, dear. It's early days yet, but the gulf between the rhetoric and the reality, between the audacity of hope and the reality of pork, yawns ever wider. Right now, it's the Obama mythology that urgently needs some stimulus. Some of us never expected him to walk on water. But we didn't think he'd be all at sea taking on quite so much of it after a mere two weeks.
And from the Wall Street Journal, The Stimulus Tragedy:
. . . Mr. Obama chose to let House Democrats write the bill, and they did what comes naturally: They cleaned out their intellectual cupboards and wrote a bill that is 90% social policy, and 10% economic policy. (See here for a case study.) It is designed to support incomes with transfer payments, rather than grow incomes through job creation.
This is the reason the bill has run into political trouble, despite a new President with 65% job approval. The 11 Democrats who opposed it in the House didn't do so because they want to hand Mr. Obama a defeat. The same is true of the Senate moderates of both parties working to trim their $900 billion version. They've acted because they can't justify a vote for so much spending for so little economic effect. You know a piece of legislation is in trouble when even its authors begin to deny paternity, as economist Martin Feldstein has recently done.
Speaking to a House Democratic retreat on Thursday night, Mr. Obama took on those critics. "So then you get the argument, well, this is not a stimulus bill, this is a spending bill. What do you think a stimulus is? (Laughter and applause.) That's the whole point. No, seriously. (Laughter.) That's the point. (Applause.)"
So there it is: Mr. Obama is now endorsing a sort of reductionist Keynesianism that argues that any government spending is an economic stimulus. This is so manifestly false that we doubt Mr. Obama really believes it. He has to know that it matters what the government spends the money on, as well as how it is financed. A dollar doled out in jobless benefits may well be spent by the worker who receives it. That $1 of spending will count as economic activity and add to GDP.
But that same dollar can't be conjured out of thin air. The government has to take that dollar away from someone else -- either in higher taxes, or by issuing new debt in the form of a bond. The person who is taxed or buys the bond will have $1 less to spend. If the beneficiary of that $1 spends it on something less productive than the taxed American or the lender would have, then the net impact on growth will be negative.
Some Democrats claim these transfer payments are stimulating because they go mainly to poor people, who immediately spend the money. Tax cuts for business or for incomes across the board won't work, they add, because those tax cuts go disproportionately to "the rich," who will save the money. But a saved $1 doesn't vanish from the economy, unless it is stuffed into a mattress. It enters the financial system, where it is lent to others; or it is invested in the stock market as capital for businesses; or it is invested in entirely new businesses, which are the real drivers of job creation and prosperity.
At the current moment, amid a capital strike, the latter is the kind of fiscal stimulus we really need. Yet there is virtually none of it in the bills now moving through Congress. Senate moderates may succeed in cutting $100 billion or so in spending from the bill, which is political window dressing. Even they aren't talking about adding the kind of tax cuts that would really help the economy now.
We should add how different this is from the 1980s or even the 1960s. Democrats added business tax cuts to the Reagan package of 1981, while Jack Kennedy's chief economist (Walter Heller) promoted marginal rate tax cuts on stimulus grounds in the 1960s. Yet Mr. Obama, on Thursday, dismissed any such tax cuts as "the same tired arguments and worn ideas that helped to create this crisis." That's rhetoric for a campaign, not for a President hoping to rally bipartisan support.
The biggest gamble with this stimulus is what it means if the economy doesn't recover. Monetary policy is already as stimulative as it can safely get, and the Obama Administration is set to announce its big financial fix on Monday. Stocks rallied Friday on expectations of the latter, despite the job loss report, with big bank stocks leading the way. If done right, this will help reduce risk aversion and gradually restore financial confidence.
We hope it does, because the size and waste of the stimulus means we won't have much ammunition left. The spending will take the U.S. budget deficit up to some 12% of GDP, about double the peak of the 1980s and into uncharted territory. The tragedy of the Obama stimulus is that we are getting so little for all that money.
Everything Obama does is a cover for something else he is doing
1) Put in the stimulus package a Billion dollars for the 2010 Census when it has already been paid for.
2) Takes it from the Commerce Dept. where it has been since 1790 started by Thomas Jefferson and put it under the direct control of the Whitehouse.
Lets see funnel more money to Acorn and have them knocking door to door.
Why did he appoint Jeffery Immelt Ceo to his economic advisory team when GE has lost over 65% of it's value. Another excellent choice but to bad we cant get a confirmation hearing, I want this guy to help turn our economy around. It's probably a Coincidence that we are going to be handing out stimulus dollars for lots of green technology? Hmmm....who makes lots of solar panels and wind turbines? Oh and lets not forget how green they really are. General Electric has a history of large-scale air and water pollution and the Political Economy Research Institute listed the corporation as the fourth-largest corporate producer of air pollution in the United States. Not to mention the MILLIONS they have paid for polluting, hell who knows they might be responsible for Global warming all by themselves.
What does GE own in reference to the Media. And why is this important, well CBS announced today that the president will become a Monday Night regular on TV already setting it up with TV spots for the 9th, 16th and the 24th(tues.) HUMM sounds like Hugo Chavez hour of power weekly TV address. Why does this matter, well other networks who don't broadcast speeches by the president will lose viewership of their programs, unless people decide to just tune him out, which before the election he had action commitees set up thru his e-mail campaign and people had house parties to discuss actions. Well it just so happens for what ever reason this type of commitee has seen a 75% decline since the election. Could it be the very same people who voted for him have realized they have now made a mistake.
I just watched the Urgent Message Video from President Obama and at about the four minute mark he reminds us of this. " I have always said, change never begins from the top down, it begins from the bottom up". So you can count on that he will never change, but because of his ideology and policies you and I will. Change you can Believe in
http://newsbusters.org/blogs/tim-graham/2009/02/06/monday-night-political-football-obama-demanding-lots-prime-time-whining-
http://www.americanthinker.com/blog/2009/02/hows_that_grass_roots_effort_c.html
Posted by: bdaman | February 07, 2009 at 05:08 PM