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Politics : View from the Center and Left -- Ignore unavailable to you. Want to Upgrade?

To: Steve Lokness who wrote (201223)	9/12/2012 9:18:49 PM
From: koan	Read Replies (1) \| Respond to of 541853

<<That's why all the stimulus pumping we have done has barely moved the needle on unemployment. >> Unemployment didn't improve because it was swimming against a huge macro economic tide. Krugman wants to turn that tide. And thinks he knows how. I think he knows how to.

To: Steve Lokness who wrote (201223)	9/14/2012 3:12:59 PM
From: Cogito	Respond to of 541853

That's why all the stimulus pumping we have done has barely moved the needle on unemployment. I think the stimulus pumping has barely moved the needle because so much of it was directed to things like tax cuts, which have very little stimulative effect. And of course, we have the Republicans to thank for insisting on that. In the real world, of course, Obama could never had gotten a bigger package than the one he proposed through Congress, especially if it hadn't included tax cuts. Republicans have not yet been informed that tax cuts don't really stimulate the economy much. The information exists, but they haven't heard about it yet.

To: Steve Lokness who wrote (201223)	9/14/2012 4:07:19 PM
From: Sam	Read Replies (2) \| Respond to of 541853

That's why all the stimulus pumping we have done has barely moved the needle on unemployment. I am going to jump and give my view on why the stimulus "barely moved the needle on unemployment." It isn't original, and you have even said a part of it before. The part you've noted is the crash in construction. The part I would add is related to that, and that is we were in a credit (debt) bubble. That bubble borrowed "growth" from the future, as people took "advantage" of the debt bubble, making lots of money "while the sun shined bright." The collapse that followed was the result of people taking on -- and those wonderful savvy financial institutions giving -- too much debt. I submit that until everyone's balance sheets are repaired, "stimulus" money won't be very effective. Nor will any President, whoever he/she may be, be able to meaningfully increase employment. The boom created the mirage of wealth creation. We would have been far better off today if it had not occurred, if we had just gone along a more normal economic trendline. There were many culprits in all this, but financial institutions and Greenspan's Fed were the main ones setting the tone, and allowing (even pushing) it to get out of hand.