Are Republicans trying to sabotage the economy? [Archive]

mcrain

Jun 7, 2012, 08:58 AM

Warning: This is from an opinion piece by a liberal, so there is bias. That being said, is this guy right?

The first concrete example involves actual concrete -- the reauthorization of the Transportation Bill that provides funding for roads, bridges and mass transit projects across the country.

No one questions the critical necessity of these projects. They are extraordinarily popular with the voters. Transportation bills have been routinely reauthorized with bipartisan support for as long as anyone can remember.

The current bill expires June 30 -- after which there will be no funding for transportation projects during the construction season this summer. But Republicans in the House are refusing to act -- holding up action -- unless Democrats agree to fast-track the Keystone Pipeline and limit the EPA's ability to regulate coal ash.

If the bill is not reauthorized, 1.9 million construction workers would -- temporarily at least -- lose their jobs. That would be just fine with the Republicans. They'd love to use their leverage to win ideological points, but they would be even happier if almost two million Americans were added to the unemployment rolls this summer before the election.

Of course, Republicans in Congress would never dream of passing President Obama's American Jobs Act that independent economists claim would create 1.3 million new jobs. It would put people to work building needed infrastructure and provide funds to pay to rehire hundreds of thousands of teachers, firefighters, police officers and other public service workers that have been laid off in droves by cash-starved states.

And there's more. Yesterday's Washington Post reports that Republicans have made it clear that the Federal Reserve would face fierce Republican criticism if it takes further actions to stimulate the economy before the election. The Post writes that,

Republicans... have expressed deep concern about measures taken by the Fed to support the economy -- and could be doubly upset if new efforts goose the stock market and are perceived to work in favor of President Obama's re-election.

And there is great concern that the Fed would respond to Republican pressure. Vincent Reinhart, a longtime Fed economist, now chief U.S. economist at Morgan Stanley, noted that "the headline they most worry about is 'The Fed acts to help the incumbent.'"

Finally, the Republicans will stand like a great united wall to block President Obama's bill to discourage the outsourcing of American jobs, which is due to come to the Senate floor around the fourth of July.

Mitt Romney's new slogan is "Put Jobs First." Nothing could be more hypocritical -- or wrong.

The last time the Republicans had control of the White House, they gave us 25 months of massive job losses. Over George Bush's terms as President there was actually zero private sector job growth.

In contrast, President Obama's policies have given us 27 consecutive months of private sector job growth. And it would have produced millions more jobs if the Republican Congress had passed his Jobs Bill. Robert Creamer (http://www.huffingtonpost.com/robert-creamer/republicans-attempt-to-ac_b_1576962.html)

leekohler

Jun 7, 2012, 09:08 AM

Their goal is power, not the good of the country. That has been obvious ever since Obama got in office.

Eraserhead

Jun 7, 2012, 09:11 AM

That has been obvious ever since Obama got in office.

As short a time as that ;).

I would say the Clinton blow job scandal fits the same pattern.

leekohler

Jun 7, 2012, 09:15 AM

As short a time as that ;).

I would say the Clinton blow job scandal fits the same pattern.

That was just pathetic. And don't even get me started with the birthers.

classicaliberal

Jun 7, 2012, 09:18 AM

I'll take a shot at providing some contrarian commentary...

No one questions the critical necessity of these projects.
Really? No one? Well then, why even have the conversation? ;)

They are extraordinarily popular with the voters.
A lot of stupid things are popular with voters. This is why we live in a representative republic instead of a direct democracy. People can be stupid sometimes... especially in their desire for 'the government' to give them things, without feeling any desire to actually pay for those things.

The current bill expires June 30 -- after which there will be no funding for transportation projects during the construction season this summer. But Republicans in the House are refusing to act -- holding up action -- unless Democrats agree to fast-track the Keystone Pipeline and limit the EPA's ability to regulate coal ash.

So, then, who's trying to sabotage the country then... the Democrats because they won't approve of large construction project, because of a irrational fear of fossil fuels?

If the bill is not reauthorized, 1.9 million construction workers would -- temporarily at least -- lose their jobs. That would be just fine with the Republicans. They'd love to use their leverage to win ideological points, but they would be even happier if almost two million Americans were added to the unemployment rolls this summer before the election.

Of course, Republicans in Congress would never dream of passing President Obama's American Jobs Act that independent economists claim would create 1.3 million new jobs. It would put people to work building needed infrastructure and provide funds to pay to rehire hundreds of thousands of teachers, firefighters, police officers and other public service workers that have been laid off in droves by cash-starved states.

There's a HUGE fundamental difference between private jobs and public jobs. One produces money, the other spends money. All jobs aren't created equal. 1.3 million fewer public sector jobs means 1.3 fewer salaries that have to be redistributed from the productive private sector and spent on the non-productive public sector. This doesn't mean public jobs are bad, or unnecessary... but let's not equate them to actual private sector growth and resulting economic boom that would come with. These jobs cost money, not make money.

And there's more. Yesterday's Washington Post reports that Republicans have made it clear that the Federal Reserve would face fierce Republican criticism if it takes further actions to stimulate the economy before the election. The Post writes that,

No comment from the author on what this 'stimulus' actually consists of. The way the FED 'stimulates' the economy, is by buying government debt from digital money they manufacture at a whim. And each dollar they 'print' reduces the value of corresponding dollars in every citizen's pocket. So, your 'stimulus' is nothing more than a hidden TAX. It's the citizens that pay for it in the form of inflation. Nothing in this world is free, although big-government salesmen attempt to gloss over that fact on a regular basis.

Finally, the Republicans will stand like a great united wall to block President Obama's bill to discourage the outsourcing of American jobs, which is due to come to the Senate floor around the fourth of July.
You either believe in free and open markets, or you believe in protectionism. We can go ahead and apply tariffs on foreign goods and otherwise manipulate the system to prop-up domestic production, but other countries will do the same, and exports will fall accordingly. Again, nothing comes without a cost. Not many economists think that protectionism is a viable way to manage the flow of labor.

The last time the Republicans had control of the White House, they gave us 25 months of massive job losses. Over George Bush's terms as President there was actually zero private sector job growth.

In contrast, President Obama's policies have given us 27 consecutive months of private sector job growth. And it would have produced millions more jobs if the Republican Congress had passed his Jobs Bill. Robert Creamer

Both Obama and Bush have been utter failures. In my opinion, it's because they both fail to see the real problems... and solving a problem is next to impossible when you don't even know the cause. Romney is no better, and our problems are likely to worsen in the coming years.

Huntn

Jun 7, 2012, 09:21 AM

I don't even have to read the article to know that a sabotaged economy plays right into the GOP's Presidential aspirations. Everything with them is calculated. If Obama fails we win. They have all ready backed out of ventures they promoted until Obama said he'd go along with it too.

There's a HUGE fundamental difference between private jobs and public jobs. One produces money, the other spends money. All jobs aren't created equal. 1.3 million fewer public sector jobs means 1.3 fewer salaries that have to be redistributed from the productive private sector and spent on the non-productive public sector. This doesn't mean public jobs are bad, or unnecessary... but let's not equate them to actual private sector growth and resulting economic boom that would come with. These jobs cost money, not make money.

So how exactly do you feel about public jobs that take of tasks like road maintenance, teaching our children, putting out our fires, and maintaining law and order? ;) Would it be better to have for-profit contractors taking care of these items?

leekohler

Jun 7, 2012, 09:23 AM

I'll take a shot at providing some contrarian commentary...

Really? No one? Well then, why even have the conversation? ;)

A lot of stupid things are popular with voters. This is why we live in a representative republic instead of a direct democracy. People can be stupid sometimes... especially in their desire for 'the government' to give them things, without feeling any desire to actually pay for those things.

So, then, who's trying to sabotage the country then... the Democrats because they won't approve of large construction project, because of a irrational fear of fossil fuels?

There's a HUGE fundamental difference between private jobs and public jobs. One produces money, the other spends money. All jobs aren't created equal. 1.3 million fewer public sector jobs means 1.3 fewer salaries that have to be redistributed from the productive private sector and spent on the non-productive public sector. This doesn't mean public jobs are bad, or unnecessary... but let's not equate them to actual private sector growth and resulting economic boom that would come with. These jobs cost money, not make money.

No comment from the author on what this 'stimulus' actually consists of. The way the FED 'stimulates' the economy, is by buying government debt from digital money they manufacture at a whim. And each dollar they 'print' reduces the value of corresponding dollars in every citizen's pocket. So, your 'stimulus' is nothing more than a hidden TAX. It's the citizens that pay for it in the form of inflation. Nothing in this world is free, although big-government salesmen attempt to gloss over that fact on a regular basis.

You either believe in free and open markets, or you believe in protectionism. We can go ahead and apply tariffs on foreign goods and otherwise manipulate the system to prop-up domestic production, but other countries will do the same, and exports will fall accordingly. Again, nothing comes without a cost. Not many economists think that protectionism is a viable way to manage the flow of labor.

Both Obama and Bush have been utter failures. In my opinion, it's because they both fail to see the real problems... and solving a problem is next to impossible when you don't even know the cause. Romney is no better, and our problems are likely to worsen in the coming years.

Do you have any solutions to offer? What are the "real problems"?

classicaliberal

Jun 7, 2012, 09:30 AM

Do you have any solutions to offer? What are the "real problems"?

I think the "real problems" are pretty much the same as the list I made here a few days ago regarding the debt:

Lots of things.

Federal Reserve System - unlimited spending via inflationary printing of fiat currency
Reversed and slowed economic growth.
More and more people on welfare/medicare/medicaid rolls.
Fighting between 2-6 wars across the world (depending on how you count them)
"Economic Stimulus"
Troops stationed in thousands of bases around the world for apparently no reason. (Germany, Australia, to name a few)
Baby-boomer generation reaching maturity, Social Security distribution system not designed for more payees than payers
Lower incomes equals lower taxation revenue
General attitudes of Americans of entitlement - that government should do anything and everything to help them with relatively less willingness to pay for such services.
Tax cuts during war time.
Welfare system not designed first-and-foremost to get people off of welfare via self-sufficiency.
Complacency and ignorance of the populous
Government bureaucracy/inefficiency
Convoluted tax system results in unnecessary complexity and favortism of specific tax payers over others
Prescription Drug Program
No Child Left Behind
Ever expanding role of federal government in every aspect of our lives. Larger government is generally less efficient.

leekohler

Jun 7, 2012, 09:34 AM

I think the "real problems" are pretty much the same as the list I made here a few days ago regarding the debt:

I can agree with some of those. OK, what are your solutions?

citizenzen

Jun 7, 2012, 10:01 AM

Republicans are definitely trying to sabotage Obama's presidency.

If they have to take the economy down with him, that's just collateral damage.

mcrain

Jun 7, 2012, 10:04 AM

I'll take a shot at providing some contrarian commentary... Thank you.

Really? No one? Well then, why even have the conversation? ;) I think the point is that politicians on both sides agree, but one side is holding up the required legislation. Thus, a conversation is necessary.

So, then, who's trying to sabotage the country then... the Democrats because they won't approve of large construction project, because of a irrational fear of fossil fuels? Ok, put down the kool-aid. The Keystone pipeline already exists to Vandalia, Illinios. We process oil sand from canada here, and it is then sold within the US. The proposed Keystone pipeline can't be approved until the application has been submitted. As you might know, there is a Republican in North Dakota who opposed the first proposal, and Keystone withdrew the application and worked to reapply with a route that didn't threaten an aquifer or something out there. So, in other words, the GOP in Congress has a fetish for Keystone even though there is nothing to approve yet. In addition, all signs are that once the application is submitted, it's going to get approved.

Now, that being said, independent experts expect the Keystone pipeline to only create a small number of temporary jobs and then result in an increase in oil prices in the US. Why? Because instead of shipping the oil sands to Vandalia, they are going to be piped to Texas where they can refine and pump onto ships for sale in China.

So, Keystone isn't about US oil security or even jobs, but money for the oil companies. I wish I was wrong.

There's a HUGE fundamental difference between private jobs and public jobs. One produces money, the other spends money. All jobs aren't created equal. 1.3 million fewer public sector jobs means 1.3 fewer salaries that have to be redistributed from the productive private sector and spent on the non-productive public sector. This doesn't mean public jobs are bad, or unnecessary... but let's not equate them to actual private sector growth and resulting economic boom that would come with. These jobs cost money, not make money. That's just BS. A job is a job, period. If the job is paid for using tax dollars, but generates benefits for the public (like teachers, firemen, policemen, construction workers, etc.), then not only is it a job, but the public gets a benefit. An argument could be made that public jobs are actually a lot more efficient than private jobs because there is no profit component.

Let's just agree to disagree. (Although, I do want to point out that if those 1.3 million people are employed, they are paying taxes, buying things, and not receiving public aid).

So, your 'stimulus' is nothing more than a hidden TAX. It's the citizens that pay for it in the form of inflation. Nothing in this world is free, although big-government salesmen attempt to gloss over that fact on a regular basis. Interesting logic, but do you have any proof that the inflationary costs outweigh or are even close to the benifits to the overall economy by the stimulus? History says you're wrong.

You either believe in free and open markets, or you believe in protectionism. We can go ahead and apply tariffs on foreign goods and otherwise manipulate the system to prop-up domestic production, but other countries will do the same, and exports will fall accordingly. Again, nothing comes without a cost. Not many economists think that protectionism is a viable way to manage the flow of labor. Ok, so are you saying that our historically low tariffs make sense in light of the fact that other countries don't have free or open markets and protect their economies? I'm sorry, but our free/open markets aren't really free or open, and are doing nothing but stacking the deck in favor of multinational corporations which use the different rules to make as much money as possible.

China has the right idea. They have a long term plan to build itself into a superpower. They are watching us and laughing. Every day we don't invest in infrastructure, new technology, new energy, and education, is a day we come closer to being irrelevant.

Both Obama and Bush have been utter failures.

Obama has been prevented from succeeding, while Bush was an utter failure.

jessica.

Jun 7, 2012, 10:04 AM

Republicans are definitely trying to sabotage Obama's presidency.

If they have to take the economy down with him, that's just collateral damage.

Exactly. But how will they fix what they did in the long run? I think we're passing the point where this can't be fixed anytime soon.

classicaliberal

Jun 7, 2012, 10:05 AM

I can agree with some of those. OK, what are your solutions?

Replace the Federal Reserve System with a currency that is backed by a commodity (historically Gold). This should prevent government from spending on a whim - their actions would be limited by the GDP of the country.
Drastically simplify the tax code, remove unnecessarily burdensome regulations from the entrepreneurial world, reduce government debt, Reversed and slowed economic growth.
Reformat welfare programs with an emphasis on empowering capable individuals to accomplish self-sufficiency we we can spend fewer dollars over all and provide better care to those who actually need it. Eventually, this should be removed from the Federal Government's responsibilities and returned to local control so more high quality and customized care can be provided with minimal bureaucracy.
Stop Fighting between 2-6 wars across the world
Stop further "Economic Stimulus", balance our budgets, and promote free-market Austrian economics (Hayek, Mises) over Keynes' interventionist policies.
Bring Troops stationed in thousands of bases around the world... home
Stop lying to people by telling them that Social Security is safe and trustworthy. Increase retirement age, give young people the opportunity to opt-out. Educate people on the value of private savings accounts and provide incentives for savings over spending.
Empower local governments over federal government, as constitution requires to reduce government bureaucracy/inefficiency. It's easier for individual citizens to hold their politicians accountable when they can walk across town or visit the next city hall meeting to give them a piece of their mind. The larger/broader the govenrment, the less accountable to the people.
Simplify tax system. Eliminate bailouts all together. Eliminate subsidies in all but the most EXTREME conditions. Let good technologies/companies make it on their own. No corporate welfare.
Destroy Bush's Prescription Drug Program
Destroy Bush's No Child Left Behind
Destroy Obama's Health Care Plan, reinstate competition into the market place. Let insurance companies sell across state lines, let them offer a wide variety of coverage options so customers can choose to pay for visits with their own money, providing incentive for doctors/clinics to offer generic drugs and many other cost-saving efforts. Lasik eye surgery cost over $5,000 less than a decade ago... now you can get it done for $500. This is competition and free market in action.

There's a lot more to be done, but it's a start! ;)

mcrain

Jun 7, 2012, 10:16 AM

classicaliberal

Jun 7, 2012, 10:24 AM

Austrian economics is a joke. See reality or here's one site (http://world.std.com/~mhuben/austrian.html).

(edit) Oh, and pegging your currency to a commodity is crazy. Just look at gold price fluctuations, and compare those to anything that happened to the demand for real gold.

I've read a lot on the topic, both for and against, and have come to starkly different conclusions than you. I'm sorry you think it's a joke, I disagree strongly. It's the only ideology which adequately takes into consideration the complexity of people's desires, and accurately points out the fatal flaw with a small group of people thinking they know best about where capital should be allocated.

For the record, it was Austrian economists that predicted the dot com bubble, the housing bubble, and the derivatives bubble, long before anyone else did.

As far as commodity driven currency, it's the only way I know of to prevent the endless printing and inflation of the currency (which is a direct tax on the populous)

As an Austrian, I don't see bubbles bursting as the problem, but rather the solution... it's the market correcting over-valuations. It's the bubbles we should fear - bubbles caused by malinvestments in the market place, some natural, but the worst ones which are the result of governmental manipulation of the market place through things like bailouts, subsidies, etc.

MacNut

Jun 7, 2012, 10:27 AM

leekohler

Jun 7, 2012, 10:27 AM

mcrain

Jun 7, 2012, 10:31 AM

I've read a lot on the topic, both for and against, and have come to starkly different conclusions than you. I'm sorry you think it's a joke, I disagree strongly. It's the only ideology which adequately takes into consideration the complexity of people's desires, and accurately points out the fatal flaw with a small group of people thinking they know best about where capital should be allocated. Austrian economics has a lot of very interesting theories, and adds to the discussion of economics, but it comes to conclusions and relies on assumptions that are just incorrect in every imaginable way. While there may have been some who: For the record, it was Austrian economists that predicted the dot com bubble, the housing bubble, and the derivatives bubble, long before anyone else did. they weren't the only ones. Certainly not the only ones.

As far as commodity driven currency, it's the only way I know of to prevent the endless printing and inflation of the currency (which is a direct tax on the populous) There should be some amount of endless printing of money to counteract the deflationary effects of time, otherwise, more and more people end up sharing the same amount of money, driving inflation. In other words, its a balancing act.

As an Austrian, I don't see bubbles bursting as the problem, but rather the solution. It's the bubbles we should fear - bubbles caused by malinvestments in the market place, some natural, but the worst ones which are the result of governmental manipulation of the market place through things like bailouts, subsidies, etc. Bubbles aren't natural, but a symptom of failed economic efforts of an unregulated business model. The housing bubble and market bubbles weren't the result of something natural, but people gaming a system for profit to the damage of the system as a whole.

MacNut

Jun 7, 2012, 10:33 AM

Some of the things in that post I can agree with though, like getting rid of NCLB, making welfare more empowerment-focused and stopping the wars. Letting people opt out of SS though? Nope. That would kill it for sure, and I've paid too much into it. We need to make sure it is around. We don't need to get rid of it, we need to make it better.The problem we have with SS and the reason I won't see it when I get older is that people are not treating it as a safety net but as their retirement fund. That is what is stressing the system.

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The housing bubble and market bubbles weren't the result of something natural, but people gaming a system for profit to the damage of the system as a whole.Isn't that the stock market as a whole?

mcrain

Jun 7, 2012, 10:34 AM

The problem we have with SS and the reason I won't see it when I get older is that people are not treating it as a safety net but as their retirement fund. That is what is stressing the system.

What? What is the practical difference? Those who see it as a safety net get exactly the same check as someone else similarly situated who uses SS as their retirement fund.

MacNut

Jun 7, 2012, 10:36 AM

What? What is the practical difference? Those who see it as a safety net get exactly the same check as someone else similarly situated who uses SS as their retirement fund.What was the original intent of SS, was is a fall back when you needed it or was it meant for everyone to use when they retired and would support you the rest of your life? How can we now support all the baby boomers who are all taking out the money at once?

mcrain

Jun 7, 2012, 10:39 AM

What was the original intent of SS, was is a fall back when you needed it or was it meant for everyone to use when they retired and would support you the rest of your life? How can we now support all the baby boomers who are all taking out the money at once?

The original intent was that everyone who qualified had it. Period. The difference between what is happening today vs. then is that people are living longer. When SS was created, it was rare for people to live beyond 65. To have the same mortality levels as when SS was created, the retirement age would have to be raised into the upper 70s or low 80s.

I'm pretty sure you're going to have a hard time making that happen.

classicaliberal

Jun 7, 2012, 10:42 AM

Bubbles aren't natural, but a symptom of failed economic efforts of an unregulated business model. The housing bubble and market bubbles weren't the result of something natural, but people gaming a system for profit to the damage of the system as a whole.

We clearly approach the issues from different perspectives, but that's what makes conversation interesting!

In regards to bubbles, they happen every day at every level of the economic ladder, both macro and micro. They're both natural and manufactured. Bubbles can be the result of irrational excitement or pessimism around a specific product/technology, but you're exactly right that in modern times they are dramatically amplified by failed economic efforts and market manipulations.

I think we probably disagree as to the cause of the housing bubble, as I would place more of the blame on government's promotion of a 'owner's society', consequences be damned... along with financial institutions who - in the face of government promises and back room deals - knew that their exposure to risk was extremely low or non-existent resulting in internal policies which incentivized short-term growth over long-term prosperity. But the honest truth is that it was a complex issue, and no one's hands were left completely clean in that debacle. I'd argue also that the homeowners themselves bear some of the responsibility.

Eraserhead

Jun 7, 2012, 11:04 AM

Replace the Federal Reserve System with a currency that is backed by a commodity (historically Gold). This should prevent government from spending on a whim - their actions would be limited by the GDP of the country.

Doesn't that limit the size of the economy to the amount of gold?

Drastically simplify the tax code,... reduce government debt,

Agreed.

remove unnecessarily burdensome regulations from the entrepreneurial world,

FWIW I believe in the US a lot of them are at state level - e.g. this (http://www.economist.com/blogs/freeexchange/2012/05/structural-reform).

Reformat welfare programs with an emphasis on empowering capable individuals to accomplish self-sufficiency we we can spend fewer dollars over all and provide better care to those who actually need it.

I would have thought that that is its current aim, if it isn't doing so that is because it would cost more and/or it is hard.

Stop further "Economic Stimulus", balance our budgets, and promote free-market Austrian economics (Hayek, Mises) over Keynes' interventionist policies.

Why? What are the examples of this working?

Stop lying to people by telling them that Social Security is safe and trustworthy. Increase retirement age, give young people the opportunity to opt-out.

Increasing the retirement age is clearly a good idea, but how exactly would allowing an opt-out be a good idea?

Educate people on the value of private savings accounts and provide incentives for savings over spending.

Agreed on education, but there is a massive incentive to save for retirement already - pensions have a massive tax break.

Destroy Obama's Health Care Plan, reinstate competition into the market place. Let insurance companies sell across state lines,

Do you really think competition across state lines is going to halve the costs? That's what it would have to do to draw level with even efficient government run healthcare, as in the UK.

let them offer a wide variety of coverage options so customers can choose to pay for visits with their own money, providing incentive for doctors/clinics to offer generic drugs and many other cost-saving efforts. Lasik eye surgery cost over $5,000 less than a decade ago... now you can get it done for $500. This is competition and free market in action.

And are people realistically going to save enough to pay for healthcare? Or are the poor going to be consigned to the scrapheep?

I'm pretty sure you're going to have a hard time making that happen.

We are going to have to do that though.

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As short a time as that ;).

I would say the Clinton blow job scandal fits the same pattern.

That was just pathetic. And don't even get me started with the birthers.

I hate to discuss votes, but seriously. My comment is at +1 and Lee's is at -1 (including my +1 vote)

Why is Lee's comment, where he is agreeing with mine, scored so much more negatively? It seems pretty lame.

mcrain

Jun 7, 2012, 11:08 AM

Ok, so can anyone explain why the GOP is blocking things they agree on?

leekohler

Jun 7, 2012, 11:09 AM

Ok, so can anyone explain why the GOP is blocking things they agree on?

Yes. I said it earlier. Their goal is not the betterment of the country. Their goal is power.

Huntn

Jun 7, 2012, 11:12 AM

Ok, so can anyone explain why the GOP is blocking things they agree on?

I said it in reply #6:

I don't even have to read the article to know that a sabotaged economy plays right into the GOP's Presidential aspirations. Everything with them is calculated. If Obama fails we win. They have all ready backed out of ventures they promoted until Obama said he'd go along with it too.

classicaliberal

Jun 7, 2012, 11:13 AM

Doesn't that limit the size of the economy to the amount of gold?

That's actually a common myth, but no, it would not limit the size of the economy... All it limits is the number of times you can divide your currency by to give the perception of wealth. It's, a bit hard to understand, I'll give you that. ;) Basically, wealth and currency are not the same thing. During any given year a society creates a specific amount of wealth. We traditionally measure this wealth in measures of currency.

If one year an example economy makes $1million worth of wealth, and the next year they work just as hard and make the same amount of wealth... but in that second year their Federal Reserve prints enough fiat dollars to double the supply of currency... the math would tell you that there was actually double the amount of wealth created! However, since the standard of measure has changed, it only appears as if you've created more wealth... it's not real... just inflation.

It's just like when a stock splits. Today, Apple is worth ~$570. If you have one share, and they split the stock tomorrow, you now have 2 shares (YAY!), but combined they're still only worth $570.

The truly dastardly aspect of fiat money is that when the Federal Reserve prints new money, we don't all get the money at the same time... the government doesn't divide this money by the number of citizens and divvy it out accordingly... they give it to government agencies or a few select global-scale banks. It's essentially as if they stuck their hands in every single American citizens' pocket at once and stole a percentage of every dollar you own... then proceeded to give it to their buddies. That's why I generally refer to it as a 'tax'. It's not as if the money is free, and comes at the expense of no one... we're the ones who pay via currency devaluation.

So, all a commodity standard does is eliminate this fluctuation and the false perception of wealth creation. It means that a dollar is worth the same today as tomorrow... it brings consistency and clarity to the market place while preventing government from spending like drunken sailors and manipulating our collective currency.

It's obviously a lot more complex than I make it sound... but that's the nuts and bolts as I understand them for anyone interested in why this issue has become such a popular topic lately.

Sorry, I only had time to respond to one of your great questions! I'd be glad to expand on the others at a later date, or in other threads. ;)

noisycats

Jun 7, 2012, 12:12 PM

Ok, so can anyone explain why the GOP is blocking things they agree on?

because Obama agrees with some of those things as well?

See citizenzen note above (#10)

Everything, including beliefs and principles, are secondary to the GOP right now. Getting rid of Obama is job 1 (actually has been for a long time).

hulugu

Jun 7, 2012, 12:48 PM

...
There's a HUGE fundamental difference between private jobs and public jobs. One produces money, the other spends money. All jobs aren't created equal. 1.3 million fewer public sector jobs means 1.3 fewer salaries that have to be redistributed from the productive private sector and spent on the non-productive public sector. This doesn't mean public jobs are bad, or unnecessary... but let's not equate them to actual private sector growth and resulting economic boom that would come with. These jobs cost money, not make money.....

This isn't true. The relationship between private and public jobs is far more complicated than the 1:1 relationship you describe. How does that fit within industries like defense? Does an engineer working at Lockheed Martin cost jobs or promote them? He's paid, indirectly, by public funds if he's working on the F-35 designs, but he has a 'private' job.

Moreover, how does that account for the huge multiplier effects you get with infrastructure and public works jobs? The multiplier for the Interstate Highway system (to use a big, obvious example) was enormous for GDP, but the entire project was funded by federal money and much of the work was completed by a federal agency and yet, the boom from that project was measurable.

leekohler

Jun 7, 2012, 12:51 PM

WestonHarvey1

Jun 7, 2012, 01:05 PM

Also, all of that federal money spent for infrastructure goes right back into the US economy. When people have jobs they have money to spend to buy products most likely from private companies.

This kind of spending can be very good, obviously. With the interstate system we had an already proven technology (roads), a ton of users itching to use the system, and obvious benefits.

Then you can have things like Solyndra which don't work out as well. With energy, we know the benefits and have plenty of demand, but what is missing is the proven technology. It's like committing to the interstate system before knowing that roads work.

And I know my analogy is not perfect, the interstate system dwarfed the investment in Solyndra.

BFizzzle

Jun 7, 2012, 01:23 PM

its not just republicans "sabotaging" the economy..

ThisIsNotMe

Jun 7, 2012, 01:35 PM

Funny.

The House has sent 30 bills relating to the economy to the Senate and Harry Reid wont even all a vote on them.

Hrm.

citizenzen

Jun 7, 2012, 01:37 PM

Funny.

The House has sent 30 bills relating to the economy to the Senate and Harry Reid wont even all a vote on them.

Hrm.

Source please.

Rodimus Prime

Jun 7, 2012, 01:45 PM

Funny.

The House has sent 30 bills relating to the economy to the Senate and Harry Reid wont even all a vote on them.

Hrm.

And the next question is what other crap did they tag onto those bills to make damn sure they would never pass.

That has become SOP. Anything the dems want they make damn sure to put something in there to make damn sure they will not vote on it.

classicaliberal

Jun 7, 2012, 02:19 PM

This isn't true. The relationship between private and public jobs is far more complicated than the 1:1 relationship you describe. How does that fit within industries like defense? Does an engineer working at Lockheed Martin cost jobs or promote them? He's paid, indirectly, by public funds if he's working on the F-35 designs, but he has a 'private' job.

Moreover, how does that account for the huge multiplier effects you get with infrastructure and public works jobs? The multiplier for the Interstate Highway system (to use a big, obvious example) was enormous for GDP, but the entire project was funded by federal money and much of the work was completed by a federal agency and yet, the boom from that project was measurable.

Also, all of that federal money spent for infrastructure goes right back into the US economy. When people have jobs they have money to spend to buy products most likely from private companies.

I completely agree that government projects (like the highway system) can create value. The same with defense projects, and lots of other ones as well. I do however have some problem with how the accounting works for such projects.

When government starts a project is usually presents some sort of cost/benefit analysis . Usually in the column of 'benefits' they put 'jobs.' I find issue with this accounting for several reasons... first, the salaries being paid come not from the value their project adds to society, but from the previous taxation of actual private/productive elements of society.

The labor should actually be accounted as a 'cost' in my opinion, an opportunity-cost... as in if these workers are working on this project, what can't they be working on in the private sector instead? The question then becomes, are they adding more value with through that particular government project than they could be adding in the private sector? Sometimes the answer is yes, other times it's no... but the crux of the issue is that private industry at least has a way of measuring such things and compensating based on value created. This was the source my original statement that private sector jobs are generally more valuable than public sector jobs.

In the private world, if little value is added, compensation is reduced, and the position will likely be eliminated or vacated as the employee seeks out better opportunities where he/she can provide more value. In government, it's much harder, even impossible to compensate based on value... and as such... costs often skyrocket, employees are rarely fired, poor employees are paid equally to high quality employees, and budgets tend to grow as long as they spent everything they received the year before. Such a system is prone to waste, inefficiency, and so on.

There are obviously exceptions to the rule, and there are obviously instances where public employees are providing incredible amounts of value right where they are. That is not to be disputed... but unfortunately, I think it's often not the case... especially with last minute rushed projects which are created in large part specifically for the purpose of 'creating jobs!'

A good rule of thumb is that if a job is being created largely for the sake of creating jobs, it's probably a very bad idea. Otherwise we could just start a big government organization charged with digging holes and another charged with filling those holes in. To improve the impact on the job market, we'll make them dig with plastic spoons which will necessitate more jobs to be created, and we can also send money to the local plastic spoon manufacturers! ;)

hulugu

Jun 7, 2012, 02:19 PM

...Then you can have things like Solyndra which don't work out as well. With energy, we know the benefits and have plenty of demand, but what is missing is the proven technology. It's like committing to the interstate system before knowing that roads work.

And I know my analogy is not perfect, the interstate system dwarfed the investment in Solyndra.

Well, keep in mind that investment on future energy technology like a cheap solar-cell film can be highly beneficial. China is pushing hard on solar-cell technologies, as is Germany, so while Solyndra was a bust (and there are both political and economic reasons for this), this doesn't mean that energy investment, even in new technologies, isn't valuable. We spent billions on nuclear reactor designs in the 50's and 60's leading to plants we still use.

Note, the story from Romney about Solyndra (http://factcheck.org/2012/06/romneys-solar-flareout/) is a partisan attack and little else.

Don't like the Solyndra debacle paint a bullseye on other investments, the 'green' economy will be a powerful multiplier in our national economy.

Funny.

The House has sent 30 bills relating to the economy to the Senate and Harry Reid wont even all a vote on them.

Hrm.

As stated by Rep. Boehner, there aren't 30 bills but rather 27, however, none of these are serious 'jobs' bills. Rather, they are a partisan grab-bag of bills that, for example, remove new mercury pollution standards; keep the EPA from revise clean air regulations and creating an exemption for "farm dust"; and removes SEC regulation from 'start-up' firms with less than $1 million in venture capital funds.

These are not jobs bills, 12 are built to limit the EPA, several are designed to remove SEC evaluation, and the rest attack federal unions. This is why Rep. Pelosi called them "message bills."

hulugu

Jun 7, 2012, 02:37 PM

...When government starts a project is usually presents some sort of cost/benefit analysis . Usually in the column of 'benefits' they put 'jobs.' I find issue with this accounting for several reasons... first, the salaries being paid come not from the value their project adds to society, but from the previous taxation of actual private/productive elements of society.

The labor should actually be accounted as a 'cost' in my opinion, an opportunity-cost... as in if these workers are working on this project, what can't they be working on in the private sector instead? ...

An engineer working for Lockheed Martin is working in the "private sector" regardless of whether the job is on the F-35 or a turbine for a Gulfstream, in either case, the engineer spends his wages by buying a house. The house was built by a contractor and laborers/craftsmen who each earn money for the construction. The house must be furnished which creates a demand for couches, sinks, a TV or two, not to mention the energy and water, which creates some demand for technicians at the utilities, not to mention the guy to hook up the cable.

So, there are multiplier effects regardless. The difference is, the F-35 comes with a federal cost, so it's multiplier is less than if he worked on the Gulfstream, but there is still a multiplier effect.

...A good rule of thumb is that if a job is being created largely for the sake of creating jobs, it's probably a very bad idea. Otherwise we could just start a big government organization charged with digging holes and another charged with filling those holes in. To improve the impact on the job market, we'll make them dig with plastic spoons which will necessitate more jobs to be created, and we can also send money to the local plastic spoon manufacturers! ;)

An ad absurdum if there ever was one, no one is suggesting this as a jobs plan and even the wide-ranging agencies during FDR had an end product in mind, even if that was a trail in a national forest.

citizenzen

Jun 7, 2012, 02:57 PM

An ad absurdum if there ever was one

Exactly.

No one is suggesting we employ people to dig up holes only to fill them back in.

:rolleyes:

leekohler

Jun 7, 2012, 03:00 PM

Exactly.

No one is suggesting we employ people to dig up holes only to fill them back in.

:rolleyes:

Exactly. There's plenty that needs doing. And it is too bad Solyndra did not work out. We really need to get into developing alternative energy sources.

Raid

Jun 7, 2012, 03:04 PM

I've read a lot on the topic, both for and against, and have come to starkly different conclusions than you. As someone with a degree in economics, "Austrian economics" is nothing more than Laissez-faire, free market ideal with all the same mechanics as Keynesian economics but free from the burden of quantifiable measurement. Most of your views on how the economy function though seem to be incomplete.

1)Commodity standards have their own problems, mainly that the government must act as an agent to maintain the correct amount of commodity reserves in order to maintain monetary supply. To keep this short I'll ignore drains like holding costs and market valuation issues. This does restrict the ability to stabilize the domestic economy, but in a sense that's what Austrian economists want to do, remove the ability of governments to control the economy. They seem to think there's a free-market paradise, but history has shown this increases the peaks and valleys in the economic cycle.

2) Your wealth example is not quite complete either, assuming that the $1M of wealth includes drains accumulated during the course of the year, by the end of the second year this person would have $2M of wealth (so that technically double) then if the supply of currency was doubled, then that persons wealth would be $4M... HOWEVER in real terms (http://en.wikipedia.org/wiki/Real_dollars) (as us economists like to call it) that persons wealth would still be $2M and he still has doubled his wealth in this simplistic scenario.

3) In stock splits, you are correct, the accumulated value (even including potential dividends) should remain the same. However this is the completely wrong example from accumulating wealth... If all ones wealth was in their home and they sawed it in half you still wouldn't have thought they doubled their money!

4) In regards to the 'dastardly aspect' of fiat money being the "tax" on your money; again it's a half truth. Yes an increase in the money supply does slightly erode the value of the currency you currently hold, but in the same token if you view the increase in demand for the dollar in a similar light... it's free money!!!1!!eleven!!

I completely agree that government projects (like the highway system) can create value. The same with defense projects, and lots of other ones as well. I do however have some problem with how the accounting works for such projects. Well you understand that they are coming from the otherside of things with unique mechanics as these government jobs in your example have a feed-back in way of taxes (they also stimulate local economies, and -hopefully- save for retierment) all good things for the government for their present and future books. When you talk of labour being a cost, you are coming very close to the concept of government 'crowding out' which is a problem, but it really only becomes a 'problem' for the private sector if the unemployment rate is extremely low. Your argument about waste and inefficiency may be a little culture biased, after working in both the private and public sectors there are inefficiencies on both sides. The government inefficiencies are akin to 'death by a thousand paper cuts', while the news grabbing corporate inefficiencies are often lavish expenditures by executives.

classicaliberal

Jun 7, 2012, 03:14 PM

An engineer working for Lockheed Martin is working in the "private sector" regardless of whether the job is on the F-35 or a turbine for a Gulfstream, in either case, the engineer spends his wages by buying a house. The house was built by a contractor and laborers/craftsmen who each earn money for the construction. The house must be furnished which creates a demand for couches, sinks, a TV or two, not to mention the energy and water, which creates some demand for technicians at the utilities, not to mention the guy to hook up the cable.

So, there are multiplier effects regardless. The difference is, the F-35 comes with a federal cost, so it's multiplier is less than if he worked on the Gulfstream, but there is still a multiplier effect.

Agreed.

Do you agree or disagree generally with my comments on jobs which are 100% public though? When the employee is actually employed by the federal government and not through a private enterprise like Lockheed.

An ad absurdum if there ever was one, no one is suggesting this as a jobs plan and even the wide-ranging agencies during FDR had an end product in mind, even if that was a trail in a national forest.[/QUOTE]

It's not an ad abusrdum... the projects that are chosen are never projects that have zero merit, but they are OFTEN projects that had relatively little merit, or less merit than previously justified the expense.

The example of the hole digging is to take the logic to it's conclusion in an attempt to demonstrate the absurdity of creating a job for the sake of creating a job. The implication being that the less merit the original project had, and the more 'job creation' is the primary justification of the project, the more absurd, inefficient, and wasteful the project likely is. Creating public-sector jobs should never be a reason for undertaking stupid projects.

Nancy Pelosi's statement on how unemployment checks being the fastest way to create jobs is a good example of this:
http://www.youtube.com/watch?v=DfP0iddR4lI - What's happening here is that she is seeing the 'benefit' but is completely blind to the cost. Every single dime that goes to unemployment checks had to come from somewhere. So whatever is being put in to the economy has got to come out of the productive sector. You can OBVIOUSLY and HONESTLY argue that unemployment checks are benefit to society serving as a safety net, but to suggest they create wealth/jobs is patently ridiculous IMHO.

citizenzen

Jun 7, 2012, 03:23 PM

Nancy Pelosi's statement on how unemployment checks being the fastest way to create jobs is a good example of this ...

I think her point is that the unemployment payments filter back into the private sector (where else is it going to go) which helps to keep the economy going ... and other people employed.

Her answer made sense to me.

I don't think she's implying it's a long-term solution.

classicaliberal

Jun 7, 2012, 03:34 PM

As someone with a degree in economics, "Austrian economics" is nothing more than Laissez-faire, free market ideal with all the same mechanics as Keynesian economics but free from the burden of quantifiable measurement. Most of your views on how the economy function though seem to be incomplete.

As someone without a degree in economics, I sincerely appreciate your response! ;)
BTW, everything I know on the topic, I read from books on one side or the other... I don't pretend to be an expert on the issue... I probably know more than most about how the system works and the alternative systems, but to most 'experts' I'm "like a child wandering through the woods."

1)Commodity standards have their own problems, mainly that the government must act as an agent to maintain the correct amount of commodity reserves in order to maintain monetary supply. To keep this shore I'll ignore drains like holding costs and market valuation issues. This does restrict the ability to stabilize the domestic economy, but in a sense that's what Austrian economists want to do, remove the ability of governments to control the economy. They seem to think there's a free-market paradise, but history has shown this increases the peaks and valleys in the economic cycle.

You're exactly right that the goal is to remove the government's ability to control (I'd use the term manipulate) the economy. I am not naive enough to think that there is a free-market paradise, rather as a realist and general skeptic I recognize that paradise doesn't exist. I simply believe that free individual citizens are more capable of making personal economic decisions, and that more often than not the guiding hand of elites do more damage than good while they prop up industries that give them campaign funding, and enact legislation to squash their competitors. I tend to believe in a flat playing field and un-weighted dice. Continuing with the game analogies... let the chips fall where they may. ;)

You're exactly right that there will still be bubbles and bursts under a commodity backed currency, but like I said before, unlike the keynsians who fear the burst, I consider it to be the solution to the problem. In a normal housing bubble for instance, the implication is that homes are over built an that supply has outstripped demand. As a consequence, prices need to fall in order for the mis-allocated capital to clear and for prices to return to a normal level. Not only will allowing the bubble to burst shorten the pain of the downturn, but will supply less wealthy individuals with the opportunity they'd been waiting for to buy their first house. The Keynsian alternative tries to prevent the bubble from popping, innevitably leading to a much larger bubble and more painful/drawn-out burst.

2) Your wealth example is not quite complete either, assuming that the $1M of wealth includes drains accumulated during the course of the year, by the end of the second year this person would have $2M of wealth (so that technically double) then if the supply of currency was doubled, then that persons wealth would be $4M... HOWEVER in real terms (http://en.wikipedia.org/wiki/Real_dollars) (as us economists like to call it) that persons wealth would still be $2M and he still has doubled his wealth in this simplistic scenario.

Was there anything inaccurate with my earlier statement, or are you just adding complexity for complexity's sake? ;) (BTW, thanks for the reminder on "real dollars".)

3) In stock splits, you are correct, the accumulated value (even including potential dividends) should remain the same. However this is the completely wrong example from accumulating wealth... If all ones wealth was in their home and they sawed it in half you still wouldn't have thought they doubled their money!

You would because as inflation worked its way through the system, the house would double value based on the new face value of the dollar. Even though though the house was worth $100,000 last year, and this year it says $200,000, it's still the same house. It's just that your unit of measurement has been redefined. Too bad for you though, because your salary didn't double.

4) In regards to the 'dastardly aspect' of fiat money being the "tax" on your money; again it's a half truth. Yes an increase in the money supply does slightly erode the value of the currency you currently hold, but in the same token if you view the increase in demand for the dollar in a similar light... it's free money!!!1!!eleven!!

Why would the demand for the dollar go up? Only if it's the reserve currency of the world and the other currencies were undertaking the same sort of inflationary stance would this occur... correct? Otherwise, as inflation looms and there are more dollars chasing fewer goods, you have reduced the valuation of the dollar and as a consequence reduced it's demand. Let me know if I'm missing something there.

Dmunjal

Jun 7, 2012, 03:57 PM

Austrian economics is a joke. See reality or here's one site (http://world.std.com/~mhuben/austrian.html).

(edit) Oh, and pegging your currency to a commodity is crazy. Just look at gold price fluctuations, and compare those to anything that happened to the demand for real gold.

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard? Why did the founders expressly put "only gold and silver can be considered money" in the Constitution?

To the original point, yes, Republicans are trying to sabotage the economy to help them in the upcoming election. The Democrats would do the same thing and did in 2008. Early in 2008, Democrats were talking down the economy on every news show while they talk UP the economy now

Both sides are equally political. Arguing who does it better or worse or who is more immoral than the other is pointless. What we need is a system that prevents them from using their political gain against the general population.

The gold standard was instituted to prevent this. It ties the hands of Congress to spend only what the GDP and taxes can provide.

leekohler

Jun 7, 2012, 03:59 PM

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard? Why did the founders expressly put "only gold and silver can be considered money" in the Constitution?

To the original point, yes, Republicans are trying to sabotage the economy to help them in the upcoming election. The Democrats would do the same thing and did in 2008. Early in 2008, Democrats were talking down the economy on every news show while they talk UP the economy now

Both sides are equally political. Arguing who does it better or worse or who is more immoral than the other is pointless. What we need is a system that prevents them from using their political gain against the general population.

The gold standard was instituted to prevent this. It ties the hands of Congress to spend only what the GDP and taxes can provide.

Did the Democrats deliberately do something in the legislature (pass laws or hold up legislation) to sabotage the economy?

Rodimus Prime

Jun 7, 2012, 04:01 PM

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard? Why did the founders expressly put "only gold and silver can be considered money" in the Constitution?

To the original point, yes, Republicans are trying to sabotage the economy to help them in the upcoming election. The Democrats would do the same thing and did in 2008. Early in 2008, Democrats were talking down the economy on every news show while they talk UP the economy now

Both sides are equally political. Arguing who does it better or worse or who is more immoral than the other is pointless. What we need is a system that prevents them from using their political gain against the general population.

The gold standard was instituted to prevent this. It ties the hands of Congress to spend only what the GDP and taxes can provide.

talking down the economy is vastely different than intentionally blocking bills that would help it. The GOP wants the economy to go worse and they have and will do everything in their power to cause it.

Eraserhead

Jun 7, 2012, 04:15 PM

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard?

But everyone else has flourished since World War I off the gold standard. And the US (http://en.wikipedia.org/wiki/Gold_standard#US) only appears to have really stuck to the gold standard since 1848.

The Democrats would do the same thing and did in 2008. Early in 2008, Democrats were talking down the economy on every news show while they talk UP the economy now

How is it equivalent to talk it down on a talk show and to refuse to pass bills?

mcrain

Jun 7, 2012, 04:17 PM

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard? Why did the founders expressly put "only gold and silver can be considered money" in the Constitution? It is a crazy idea today to go back to the gold standard. Back then there weren't commodity traders nor were there fractional shares being bought and sold on secondary markets. My point wasn't that it never worked in the past, but it would be lunacy to try to go back.

To the original point, yes, Republicans are trying to sabotage the economy to help them in the upcoming election. The Democrats would do the same thing and did in 2008. Early in 2008, Democrats were talking down the economy on every news show while they talk UP the economy now

Both sides are equally political. Arguing who does it better or worse or who is more immoral than the other is pointless. What we need is a system that prevents them from using their political gain against the general population.

Ok, so the Democrats correctly pointed out that the economy was tanking and are again correctly pointing out that it is improving, and you think that's political? The point of the thread is that the economy is improving while Republicans are talking it down, and actively trying to slow the growth or reverse it.

NickZac

Jun 7, 2012, 04:40 PM

I think this is pretty common around election time and this game is played by both parties. And the real losers are us.

Rodimus Prime

Jun 7, 2012, 04:42 PM

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard? Why did the founders expressly put "only gold and silver can be considered money" in the Constitution?
.

I am going to point out we have not been on the gold standard since 1933.
From 1933 to 1971 it was gold standard in name only.
The time between 1933 when the US started devaluing the dollar vs gold. Good part of the great depression is blamed on the fact we could not expand the money supply.

Dmunjal

Jun 7, 2012, 06:30 PM

I am going to point out we have not been on the gold standard since 1933.
From 1933 to 1971 it was gold standard in name only.
The time between 1933 when the US started devaluing the dollar vs gold. Good part of the great depression is blamed on the fact we could not expand the money supply.

But you can't deny we did flourish for a long time, including the industrial revolution of the 1800s on the gold standard? Why can't we blame the depression on the great expansion of the money supply in the 1920s? Take that away and there's no great depression. Take away zero-down home loans and easy money and there's no housing bubble in the 2000s and therefore no great recession today.

The EXTREME expansion of the money supply made possible by the Fed creates the booms and the eventual bust. The gold standard, while not perfect, let's the market deal with this issue. While it might make for slower growth, the growth is real and not as susceptible to major swings up and down.

citizenzen

Jun 7, 2012, 06:40 PM

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard?

Just our of curiosity, have you ever looked at the arguments against the gold standard? There is no shortage of them out there.

I'm a graphic designer and don't pretend to understand the arguments. However, it seems to me that if solving everything were as simple as the proponents of the gold standard make it out to be, then why wouldn't it be brought back?

Dmunjal

Jun 7, 2012, 06:43 PM

But everyone else has flourished since World War I off the gold standard. And the US (http://en.wikipedia.org/wiki/Gold_standard#US) only appears to have really stuck to the gold standard since 1848.

How is it equivalent to talk it down on a talk show and to refuse to pass bills?

I would agree that isn't equivalent but arguing over who is worse is pointless. Just a blame game. Let's stop blaming, taking sides, and fix the system. We can't fix people but we can fix the system. Get rid of the Fed, get back on the gold standard, and Congress WILL have to fix this problem. They will quickly realize they can't just raise taxes or just cut spending and will compromise. The Fed has given the Congress a crutch so they can kick the can down the road. We are coming to the end of the road.

ThisIsNotMe

Jun 7, 2012, 06:45 PM

As stated by Rep. Boehner, there aren't 30 bills but rather 27, however, none of these are serious 'jobs' bills. Rather, they are a partisan grab-bag of bills

According to whom? The Democrats that wont allow the Senate to vote on them?

citizenzen

Jun 7, 2012, 06:48 PM

According to whom? The Democrats that wont allow the Senate to vote on them?

Where's that source that I asked for?

You still need to back up your claim.

Dmunjal

Jun 7, 2012, 06:48 PM

Just our of curiosity, have you ever looked at the arguments against the gold standard? There is no shortage of them out there.

I'm a graphic designer and don't pretend to understand the arguments. However, it seems to me that if solving everything were as simple as the proponents of the gold standard make it out to be, then why wouldn't it be brought back?

The gold standard enforces discipline on the government. A fiat system gives them (both sides) power to create money and spend freely (on warfare and welfare) and they don't ever want to give that up.

I would agree that returning to the gold standard will be tough but better for the country in the long gone term.

Quote from Alan Greenspan:

"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. ... This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard."

citizenzen

Jun 7, 2012, 06:51 PM

Quote from Alan Greenspan ...

You mean this Alan Greenspan ...?

Alan Greenspan is up on Capitol Hill today, apparently issuing a bit of a mea culpa. (Our colleagues at DealBook are live blogging the hearing.) Mr. Greenspan said he had believed that banks would do a good job of protecting their own financial interests, which was largely why he didn’t try to put a stop to the explosion of risky mortgage lending. He is now in a “state of shocked disbelief” that banks failed to do so.

[source (http://economix.blogs.nytimes.com/2008/10/23/greenspans-mea-culpa/)]

I'm not sure I'd be using him as an expert source.

Dmunjal

Jun 7, 2012, 07:41 PM

I prefer the original before he gave into politics. :-)

How about Jefferson?

"I believe that banking institutions are more dangerous to our liberties than standing armies . . . If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] . . . will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered . . . The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."-- Thomas Jefferson 

There is plenty of evidence that the founding fathers only wanted gold and silver as currency. Also, no fiat system has ever survived more than a couple of hundred years before it's corrupted. Gold has stood the test of time for thousands of years.

MadeTheSwitch

Jun 7, 2012, 10:20 PM

Both Obama and Bush have been utter failures. In my opinion, it's because they both fail to see the real problems... and solving a problem is next to impossible when you don't even know the cause. Romney is no better, and our problems are likely to worsen in the coming years.

Then you could say the same about pretty much everyone the last 30 years. Our problems were not made overnight. Nor will they be solved overnight either. It's unfortunately going to take a lot of hard work to dig us out of the mess we have created for ourselves.

Eraserhead

Jun 8, 2012, 02:03 AM

I would agree that isn't equivalent but arguing over who is worse is pointless. Just a blame game. Let's stop blaming, taking sides, and fix the system.

I agree in general, but if one side is significantly worse than the other it isn't actually helpful as it lets things escalate and lets the worse side get away with far more under the "they are both bad" principle.

Certainly in the UK where there isn't the same gridlock and partisanship that there is in the US people will talk up/down the economy in an equivalent way to the Democrats in the US but they wouldn't vote against a bill they believe in.

I would expect other democracies would be the same, in France both presidential candidates talked about the economy.

EDIT: If you want an example the other way the Republicans have more spine than the Democrats and lack of spine is one of the biggest issues in the Eurozone crisis.

Also, no fiat system has ever survived more than a couple of hundred years before it's corrupted. Gold has stood the test of time for thousands of years.

Basically everyone's economy is vastly more sophisticated than it was in 1800. What worked then won't necessarily work now.

Raid

Jun 8, 2012, 11:11 AM

I simply believe that free individual citizens are more capable of making personal economic decisions, and that more often than not the guiding hand of elites do more damage than good while they prop up industries that give them campaign funding, and enact legislation to squash their competitors. First, I just want you to know I appreciate the fact that you've got a desire to learn about these things. :) One of the base assumptions of any economic model is that there are rational expectations of the players in the market. However you also have to assume participants have 'equal' market power and good knowledge about the markets (http://en.wikipedia.org/wiki/Efficient-market_hypothesis). As in your example there can be abuses in regulated markets, but the idea is that regulation is put into place to stabilize the economy quicker than what would happen under free-market conditions.

unlike the keynsians who fear the burst, I consider it to be the solution to the problem. "Keynesians" don't fear a burst, but would rather enact policies to ensure a sudden pop is instead a gradual release of pressure. One idea behind this is to allow time for all market participants to process the information of a shift in the economy. While I personally am very weary of the bailouts banks received from poisoning their own mortgage assets the absolute destruction of the credit market would have been unparalleled. At the end I don't think either party have done anything differently, I was hoping that democrats would be more clear on the expected returns of the bailout.

You would because as inflation worked its way through the system, the house would double value based on the new face value of the dollar. Even though though the house was worth $100,000 last year, and this year it says $200,000, it's still the same house. It's just that your unit of measurement has been redefined. Too bad for you though, because your salary didn't double. Let's just say it was a bad example because inflation has very little to do with stock splits and no impact on overall real wealth, and should not be perceived as a "gain" in anyway to the shareholder.

Why would the demand for the dollar go up? Only if it's the reserve currency of the world and the other currencies were undertaking the same sort of inflationary stance would this occur... correct? Otherwise, as inflation looms and there are more dollars chasing fewer goods, you have reduced the valuation of the dollar and as a consequence reduced it's demand. Let me know if I'm missing something there. In a word, trade would increase demand for dollars. Reserve currency status would have little do do with that. There's much more that affects demand for the dollar, both domestically and internationally. I don't know if your missing something but 'fewer goods' in your statement has me confused. I will also leave you with a tid-bit that I've said more than once here: Inflation is not a necessary condition for economic growth, but a by product of a market with constrained resources.

Also, no fiat system has ever survived more than a couple of hundred years before it's corrupted. Gold has stood the test of time for thousands of years.The power of any currency ultimately rests on the soundness of the government and the economic power of the nation. There have been governments who have used commodity backed currency that have faced turmoil when it was perceived that the gold in reserve was not adequate (I think the UK in the 1700's?) or when the quantity of precious metal in the coins themselves were called into question (Romans ... don't know when but near the end I think). Yes the commodity itself is worth something, but doesn't mean the currency that is backed by it will be.

mcrain

Jun 8, 2012, 11:18 AM

"Keynesians" don't fear a burst, but would rather enact policies to ensure a sudden pop is instead a gradual release of pressure. One idea behind this is to allow time for all market participants to process the information of a shift in the economy. While I personally am very weary of the bailouts banks received from poisoning their own mortgage assets the absolute destruction of the credit market would have been unparalleled. At the end I don't think either party have done anything differently, I was hoping that democrats would be more clear on the expected returns of the bailout.

I also think Keynesians recognize that people do bad things, and regulation of markets can help prevent or slow the development of bubbles, as well as mitigate the damage bubbles cause.

As an aside, I was hoping the Democrats would just pay off the mortgages that were in trouble instead of just giving it as a gift to the banks. The banks would have still gotten the money, but the public would have been relieved of debt and the housing crisis would be that much closer to being over. Oh well, common sense was too much to expect.

mcrain

Jun 8, 2012, 11:31 AM

These are the 27 "jobs" bills passed by the house:

HR 3630 - The Middle Class Tax Relief & Job Creation Act of 2011 - This bill does indeed extend the "docfix" and unemployment insurance for a year, but with a hefty price.

•In addition to freezing federal workers' pay for three years, it requires issuance of a permit for the Keystone XL Pipeline in advance of the proposed routing by Nebraska, suspends the newly-issued mercury regulations and extends 100% expensing of business equipment (including private jets). Another so-called "jobs bill", HR 1938, was passed giving a November 1, 2011 deadline for the Keystone pipeline.
•With regard to unemployment insurance benefits, it cuts the 99-week maximum down to a 59-week maximum by mid-2012, allow states to drug-test UI recipients, and allow states to reduce state unemployment benefits and substitute federal funds. It also cuts funding for key provisions of the Affordable Care Act coming online, and adds the requirement to welfare payments that EBT cards cannot work in strip clubs, liquor stores and casinos.
•Provisions were included to auction more broadband spectrum and reclassify the 700mhz D Block as public safety broadband use only, which would be a huge payoff to Verizon Wireless lobbyists, who won that block with requirements that it remain open, after Google challenged the auction process.
•It would force Fannie Mae and Freddie Mac to pay increased guarantee fees similar in scope to those due from large banks as a part of the Dodd-Frank Act, means-tests unemployment insurance benefits and food stamp programs and increases Federal employees' contributions to their retirement system by 1.5% while freezing pay, so their pensions take a double-whammy.
•Finally, it repeals the new timing rules for estimated corporate tax payments for companies with assets of $1 billion or more so that they can use payments of estimated taxes as a timing tool for fourth quarter profit declarations.
None of the provisions outlined above create jobs. They called it a jobs act, but it was really just an act.

HR 1633 - Farm Dust Regulation Prevention Act of 2011

This bill prevents the EPA from issuing or finalizing regulations revising air quality standards under the Clean Air Act, and excepts farm dust from all references to "particulate matter."

No jobs there, but if anyone has ever suffered from Valley Fever, they might object to exempting dust, particularly farm dust, from the definition of particulate matter.

HR 10 - Regulations from the Executive in Need of Scrutiny (REINS) Act of 2011

Guts the regulation process by mandating that every regulation promulgated by approved by Congress after an onerous submission process, while exempting any Congressional finding from judicial review. Call this one the Carte Blanche For Congress To Kill All Regulatory Authority Bill.

What it is not: A jobs bill.

HR 3010 - Regulatory Accountability Act of 2011

HR 3010 is a modified, somewhat less onerous version of HR 10, setting guidelines for whether any regulations are warranted at all even if called for under a statute. Calling an anti-regulatory statute a jobs bill is a little like calling a half-built bridge infrastructure. So again, not a jobs bill.

HR 527 - Regulatory Flexibility Improvements Act of 2011

Ostensibly, HR 527 would reduce regulatory requirements on small businesses by forcing an impact study with specific focus on small business before regulation is adopted. It would limit EPA, OSHA and CFPB regulations while presumably protecting "small" closely-held Subchapter S corporations like Koch Industries. Not a jobs bill.

HR 3012 - Fairness for High-Skilled Immigrants Act of 2011

HR 3012 would expand job immigration beyond current limits by eliminating employment-based immigrant visa caps and raising the percentage of total visas granted to 15% from 7%. For this one, I'll say it IS a jobs bill, but not a jobs bill for American workers. It is the "Elite Immigration Jobs Bill of 2011".

HR 3094 - Workforce Democracy and Fairness Act

HR 3094 redefines collective bargaining units and makes significant changes to election procedures, including one intended to intimidate employees: an employer-supplied list of eligible voters with contact information provided by the employee.

Not a jobs bill. A union-buster bill.

HR 2930 - Entrepreneur Access to Capital Act

HR 2930 exempts startups raising less than $1 million in venture capital from small investors from SEC registraiton and oversight.

Not a jobs bill. An anti-regulatory bill.

HR 2940 - Access to Capital for Job Creators Act

HR 2940 repeals prohibitions on solicitation or advertising of a securities offering. It's a companion to HR 2930, and is intended to allow people with no relationship to a startup company to invest in it without any oversight by the SEC. Let's call this and its evil twins HR 2930 and HR 1965 the "Ponzi Scheme Coverup Acts of 2011"

HR 1965 - Securities Laws Amendment

HR 1965 changes the shareholder threshhold for SEC registration from 500 to 2000 shareholders. It's not a jobs bill. It's a "hide from the SEC" bill. Its companion, HR 1970, would exempt SEC registration of public offerings under $50 million rather than the current $5 million threshold.

Many More EPA Acts

So many they don't deserve to be broken down individually. HR 2273 removes coal ash regulation from the EPA and hands it to the states. HR 2681 would put a legislative stay on cement manufacturing emission standards. HR 2250 would put a legislative stay on EPA boiler MACT rules. HR 2401 would require analysis of all EPA regulations relating to air, waste, water and climate change. HR 2018 would restrict EPA from issuing any revisions to existing water standards or issuing a new standard for a pollutant if the state has already adopted one or there is an existing standard in place. In other words, ignore any new scientific research after an initial standard has been set. HR 2021 amends the Clean Air Act to open oil and gas exploration off the Alaska coast. HR 910 strips the EPA of authority to regulate greenhouse gases under the Clean Air Act, a direct assault on efforts to limit man-made contributions to climate change. HR 872 expands the use of pesticides, fungicides and rodent without EPA approval.

Many More Oil and Gas Drilling Acts

There is HR 1231, which would require the Administration to allow offshore oil and gas drilling and exploration in order to meet set domestic production goals, effectively forcing the moratorium on offshore drilling to be lifted to meet goals. HR 1229 requires the Energy Secretary to consider any offshore drilling permits within 30 days of receiving it and provide application denials in writing within 60 days of the application. Another "forced moratorium lift" bill. HR 1230 forces sales of oil leases in the Gulf of Mexico and Outer Continental Shelf of Virginia. It also lifts requirements for environmental impact statements and grandfathers in a 2007 document as authority for environmental impact.

Special Interest Legislation, or Pandering to Corporate Interests

•HR 1904 proposes an exchange of land so that Resolution Copper, LLC can mine copper on what is now part of the Tonto National Forest.
•HJ Res 37 is a resolution of disapproval on net neutrality.
•HR 2587 prohibits the NLRB from restricting where an employer can locate. This is in response to the NLRB's objection to the Boeing plant relocation to South Carolina, a right-to-work state.
These would fall under the anti-labor, anti-environment categories, but not particularly effective job creators. In fact, in Boeing's case, the jobs lost would hurt the economy more than jobs created in a right-to-work state where employers are not obligated to adhere to industry standards on contracts, safety or other issues. Crooks and Liars (http://crooksandliars.com/karoli/gops-claim-house-passed-30-jobs-bills-bogus)

Rodimus Prime

Jun 8, 2012, 11:48 AM

These are the 27 "jobs" bills passed by the house:

Kicks back and listen to the crickets as he will not respond to what the facts really say

hulugu

Jun 8, 2012, 12:06 PM

According to whom? The Democrats that wont allow the Senate to vote on them?

I think it was clear that line was strictly my own opinion, but I included what some of the bills were about.

If you'll note mcrain's list from Crooks and Liars, however, you'll see the pattern I was talking about. Most of the bills are about limiting the EPA and SEC.

For example, keeping the EPA from regulating "farm dust" won't create a single job, for example, instead it will keep the EPA from creating regulation it was never actually going to create.

Dmunjal

Jun 8, 2012, 12:07 PM

I also think Keynesians recognize that people do bad things, and regulation of markets can help prevent or slow the development of bubbles, as well as mitigate the damage bubbles cause.

As an aside, I was hoping the Democrats would just pay off the mortgages that were in trouble instead of just giving it as a gift to the banks. The banks would have still gotten the money, but the public would have been relieved of debt and the housing crisis would be that much closer to being over. Oh well, common sense was too much to expect.

I would have agreed with this approach even though I'm typically laissez-faire. But why would you expect anything else from the Fed that is owned by the banking cartel? Common sense was never given consideration.

The problem with any system that requires human intervention is that politics and cronyism get involved.

Keynesism makes sense in theory but never works in practice because it can be corrupted so easily. If we're going to have a central bank that attempts to control the economy, why not do it with a computer so there's no risk of corruption?

http://en.wikipedia.org/w/index.php?title=Taylor_rule

citizenzen

Jun 8, 2012, 01:13 PM

These are the 27 "jobs" bills passed by the house:

Thanks mcrain.

I had a feeling that there was more to it than ThisIsNotMe was letting on.

Perhaps he could lend his opinion as to how these might be considered "jobs" bills.

:rolleyes:

Raid

Jun 8, 2012, 01:33 PM

I would have agreed with this approach even though I'm typically laissez-faire. But why would you expect anything else from the Fed that is owned by the banking cartel? Common sense was never given consideration.

The problem with any system that requires human intervention is that politics and cronyism get involved.

Keynesism makes sense in theory but never works in practice because it can be corrupted so easily. If we're going to have a central bank that attempts to control the economy, why not do it with a computer so there's no risk of corruption?

http://en.wikipedia.org/w/index.php?title=Taylor_ruleI think the main point your missing is that even in a laissez-faire system market exploits are still quite possible and only mitigated by the gradual reaction of market participants seeking to establish a new equilibrium. If Keynesian economics promotes cronyism, then you should concede that laissez-faire systems can be exploitative of market powers. Laissez-faire systems aren't in place today because they were highly manipulated when market exploits presented themselves.

Dmunjal

Jun 8, 2012, 04:01 PM

Yes, that is true. But I would prefer the knowledge of millions vs. a few selected individuals. The wisdom of crowds and all that.

The Federal Reserve has been more wrong than right in recent history and we're paying the price.

Again, no system is perfect but a decentralized version is better than a centralized version. Democracy vs. Totalitarianism.

mcrain

Jun 8, 2012, 04:04 PM

Again, no system is perfect but a decentralized version is better than a centralized version. Democracy vs. Totalitarianism.

No offense, but democracy has given us the tea party. I don't want them voting on fiscal policy. They are too busy trying to legislate what women do with their naughty bits.

Dmunjal

Jun 8, 2012, 04:56 PM

None taken! I don't like the social policy of the right but I do see some similarities between the fiscal and monetary policies of the tea party and occupy Wall Street. Don't let the media and talking points divide us. We need to come together to take out the new class of corrupt politicians on both sides. 342327

rdowns

Jun 9, 2012, 11:46 AM

I believe the Republican party is willing to do anything to win the White House including tanking our recovery. Have we forgotten that they allowed the credit rating of the US to go down?

Good NYT editorial (http://www.nytimes.com/2012/06/08/opinion/the-bills-to-nowhere.html?_r=1) yesterday.

This is now the pattern of business in the House of Representatives: Spend most of the time passing bills designed not to become law but to satisfy the ideological desires of conservative voters. And block laws that actually need to get passed.

This colossal waste of time, punctuated by moments of real destruction, has been going on since early last year, and is well-illustrated this month. The House voted Thursday to repeal crucial parts of the health care reform law, and an upcoming bill would make government regulation virtually impossible. None of these bills have a chance of enactment. In the meantime, though, House Republicans won’t bring up a desperately needed transportation bill.

Political-message bills have sprouted like weeds in the last few years, the product of extreme polarization and stalemate. Elected officials have to show that they’re doing something, so they propose bills designed only to create a talking point against the other side. Senate Democrats do it, too. The Paycheck Fairness Act, which was predictably filibustered to death by Republicans on Tuesday, was the latest example. We supported that bill as an important vehicle for reducing the wage gap between men and women, but the principal reason Democrats introduced it was to embarrass Mitt Romney and other Republicans over their pronounced indifference to the issue.

Nonetheless, House Republicans have refined this practice into an art and have passed nearly two dozen of these bills. The latest example was Thursday’s vote to repeal the tax on companies that sell more than $5 million in medical devices, a component of the health care reform law. Another provision in the bill would let people use health savings accounts to pay for over-the-counter drugs, changing an aspect of the health care law in a way that would primarily benefit higher-income taxpayers.

Both provisions would cut the amount of revenue the government will need to subsidize health insurance for low-income people, though Republicans (and 37 Democrats) voted to make up for the loss with disincentives for people to accept health care subsidies. The device industry will recoup the tax with new business from currently uninsured people. The bill is designed to please conservative voters, and will not be taken up by the Senate.

Another ridiculous bill coming up would prohibit the adoption of any major new government regulation until the unemployment rate falls to 6 percent or less.

Yet the House, so eager to take these kinds of votes, won’t move the stalled transportation bill, holding up billions of dollars — and millions of jobs — on road and transit projects, apparently out of fear it might help the economy and thus the political fortunes of Democrats. Because of internal Republican divisions, the House could pass only a 90-day bill extending existing highway programs. But when the Senate overwhelmingly approved a two-year bill (on a 74-to-22 vote), House leaders held it up in conference committee, while insisting on attaching unrelated provisions, like approving the Keystone XL oil pipeline and restricting any regulations on toxic coal ash from power plants.

So far, the House Republicans have done little but show that they have no real interest in governing.

Dmunjal

Jun 9, 2012, 01:33 PM

I do agree that the Republicans are playing politics and not helping the economy. But what I don't understand is why the President and filibuster-proof Congress didn't pass these bills in 2009 and 2010? Weren't we in "the worst economy since the Great Depression" then?

Let's admit it. Obama misjudged the severity of the downturn and thought the stimulus bill was sufficient and spent most of his political capital on health care reform. Oh, what he could have done back then to resolve the major issues of our time like tax reform and banking reform. I don't think we'll ever have a chance like that again. Gridlock here we come.

leekohler

Jun 9, 2012, 01:39 PM

citizenzen

Jun 9, 2012, 01:45 PM

I do agree that the Republicans are playing politics and not helping the economy. But what I don't understand is why the President and filibuster-proof Congress didn't pass these bills in 2009 and 2010? Weren't we in "the worst economy since the Great Depression" then?

Congress was not "filibuster-proof" during the entire two year period of 2009 and 2010. They only achieved the potential of 60 votes for two relatively brief spans.

You'll notice in the screen shot (http://en.wikipedia.org/wiki/111th_United_States_Congress#Senate_3) below that Democrats and independents held a total of 60 seats between July 7, 2009 - August 25, 2009 and again between September 25, 2009 - February 4, 2010.

Dmunjal

Jun 9, 2012, 02:28 PM

Democrats also had two left leaning Republicans in Snowe and Specter.

I'm sure he could have easily passed these jobs bills back then.

Elections matter and Obama lost his mandate in 2010. I actually hope he wins again and the Republicans win the Senate. That will give him some freedom from the left and actually get things done. Clinton did it.

Rodimus Prime

Jun 9, 2012, 03:13 PM

hulugu

Jun 9, 2012, 03:48 PM

If it is crazy, how did the US flourish for almost 200 years 1776-1971 on the gold standard? Why did the founders expressly put "only gold and silver can be considered money" in the Constitution?

They didn't. That's a restriction among the states. Note during the Coinage Act of 1792, the founders allowed copper coins as part of the law.

...To the original point, yes, Republicans are trying to sabotage the economy to help them in the upcoming election. The Democrats would do the same thing and did in 2008. Early in 2008, Democrats were talking down the economy on every news show while they talk UP the economy now...

This is a false equivalence. The economy was faltering in 2007-2008 and the Democrats laid the blame (rightfully) on the Bush administration and Republican policies. However, the Republicans are not only talking about the lack of a recovery, but by actively refusing to change the debt limit actually putting that talk into practice.

I do agree that the Republicans are playing politics and not helping the economy. But what I don't understand is why the President and filibuster-proof Congress didn't pass these bills in 2009 and 2010? Weren't we in "the worst economy since the Great Depression" then?

Congress wasn't "filibuster-proof." Remember that while Congressional Democrats had a narrow majority, they couldn't exercise this majority because of "blue-dog" Democrats and procedural limits.

...Let's admit it. Obama misjudged the severity of the downturn and thought the stimulus bill was sufficient and spent most of his political capital on health care reform. Oh, what he could have done back then to resolve the major issues of our time like tax reform and banking reform. I don't think we'll ever have a chance like that again. Gridlock here we come.

The Obama administration read the tea-leaves and recognized that the Republican freak-out over the stimulus package, which was smaller than the White House original requested, wasn't going to allow for a bigger or second stimulus, so they (stupidly) negotiated in good faith.

Democrats also had two left leaning Republicans in Snowe and Specter.

And, several 'blue-dogs' would couldn't be depended on. Also, the White House was trying to negotiate in good faith and Democratic leaders wanted to be able to push for their other legislative priorities. This was a mistake, but you can see why they thought they were actually negotiating with the opposition rather than getting setup for an epic political stonewalling.

...Elections matter and Obama lost his mandate in 2010. I actually hope he wins again and the Republicans win the Senate. That will give him some freedom from the left and actually get things done. Clinton did it.

I love that "elections matter" when the Republicans earn a win, but not when Democrats do. By your argument, the Republican party should have spent 2008-2010 in accord with the White House, but they didn't.

So, the question is, do you believe in good faith governing or do you believe in hard-won politicking? Choose wisely.

citizenzen

Jun 9, 2012, 04:36 PM

Also, the White House was trying to negotiate in good faith and Democratic leaders wanted to be able to push for their other legislative priorities. This was a mistake ...

And it's an area where I fault Obama for not being strong enough. He needed to knock a few heads and tell people it was "my way or the highway". Unfortunately that just isn't in him and it hurt his chances of furthering his agenda.

Dmunjal

Jun 9, 2012, 05:30 PM

They didn't. That's a restriction among the states. Note during the Coinage Act of 1792, the founders allowed copper coins as part of the law.

This is a false equivalence. The economy was faltering in 2007-2008 and the Democrats laid the blame (rightfully) on the Bush administration and Republican policies. However, the Republicans are not only talking about the lack of a recovery, but by actively refusing to change the debt limit actually putting that talk into practice.

Congress wasn't "filibuster-proof." Remember that while Congressional Democrats had a narrow majority, they couldn't exercise this majority because of "blue-dog" Democrats and procedural limits.

The Obama administration read the tea-leaves and recognized that the Republican freak-out over the stimulus package, which was smaller than the White House original requested, wasn't going to allow for a bigger or second stimulus, so they (stupidly) negotiated in good faith.

And, several 'blue-dogs' would couldn't be depended on. Also, the White House was trying to negotiate in good faith and Democratic leaders wanted to be able to push for their other legislative priorities. This was a mistake, but you can see why they thought they were actually negotiating with the opposition rather than getting setup for an epic political stonewalling.

I love that "elections matter" when the Republicans earn a win, but not when Democrats do. By your argument, the Republican party should have spent 2008-2010 in accord with the White House, but they didn't.

So, the question is, do you believe in good faith governing or do you believe in hard-won politicking? Choose wisely.

I do believe that elections matter. I was very excited in 2008 when Obama won and I voted for him. I hated Bush's policies as another big government president. But when I saw in December 2008 that Obama kept Defense Secretary Gates and brought on Geithner for Treasury, I knew we were going to get more of the same. And I was right.

We keep arguing over the same stuff over and over with no results and that's just what the two party system want. I believe most of the country is in the center leaning liberal on social polices and conservative on fiscal polices. We are letting the neocons and progressives ruin this country.

blackhand1001

Jun 9, 2012, 05:58 PM

citizenzen

Jun 9, 2012, 06:18 PM

But when I saw in December 2008 that Obama kept Defense Secretary Gates and brought on Geithner for Treasury, I knew we were going to get more of the same.

Likewise when he used the very same phrases that Bush used, i.e., "listening to the generals on the ground." I had hoped that he'd change the way we talked about the issues and help pave the way for real progress.

But still, the alternative is far, far worse. While Obama could have been much a much better leader, I'm not about to abandon him as my candidate.

Dmunjal

Jun 9, 2012, 07:23 PM

Its always baffled me why there isn't any representation for people who have these beliefs (I truely believe they are the vast majority). If I want to be fiscally conservative why do I have to hate gay marriage and abortion and be pro war. I wish more people from both parties would grow some balls and stop voting with the party and read the bills themselves and vote what they feel is right.

I'm doing that this year. I'm voting for Gary Johnson of the Libertarian Party. I also voted for Ron Paul in the primary, to no avail.

citizenzen

Jun 9, 2012, 07:25 PM

I'm doing that this year. I'm voting for Gary Johnson of the Libertarian Party. I also voted for Ron Paul in the primary, to no avail.

Likewise you're voting for Gary Johnson to no avail.

All you're really doing to increasing Mitt Romney's chances of taking the White House and making our lives even worse.

Thanks a lot.

:rolleyes:

Huntn

Jun 9, 2012, 08:21 PM

Congress was not "filibuster-proof" during the entire two year period of 2009 and 2010. They only achieved the potential of 60 votes for two relatively brief spans.

You'll notice in the screen shot (http://en.wikipedia.org/wiki/111th_United_States_Congress#Senate_3) below that Democrats and independents held a total of 60 seats between July 7, 2009 - August 25, 2009 and again between September 25, 2009 - February 4, 2010.

Didn't the Congress change the filibuster rules from a simple majority to 60? If true, I wonder which party pushed that through?

thewitt

Jun 9, 2012, 10:47 PM

Democrats also had two left leaning Republicans in Snowe and Specter..

RINOs

Snowe was never a Republican while in office, only while running for office.

swingerofbirch

Jun 9, 2012, 10:52 PM

My impression as a progressive is that Republicans (not in terms of voters, but in terms of policy makers) are interested in short-term benefits to themselves and the interests they represent. I think sabotaging the economy is something they're willing to live with, if they even think that far in advance. I want to study the 1880s and 1890s more because to me that seems to be the period they want to harken back to the most.

hulugu

Jun 10, 2012, 12:49 AM

I do believe that elections matter. I was very excited in 2008 when Obama won and I voted for him. I hated Bush's policies as another big government president. But when I saw in December 2008 that Obama kept Defense Secretary Gates and brought on Geithner for Treasury, I knew we were going to get more of the same. And I was right.

We keep arguing over the same stuff over and over with no results and that's just what the two party system want. I believe most of the country is in the center leaning liberal on social polices and conservative on fiscal polices. We are letting the neocons and progressives ruin this country.

Its always baffled me why there isn't any representation for people who have these beliefs (I truely believe they are the vast majority). If I want to be fiscally conservative why do I have to hate gay marriage and abortion and be pro war. I wish more people from both parties would grow some balls and stop voting with the party and read the bills themselves and vote what they feel is right.

Last week, I was finishing up at work and I took the time to sit down and watch a locally-produced show on politics which included the county chairs from both the Democratic and Republican parties as well as a city representative who happens to be Republican.

And, as I was watching the video, it struck me: the Democrat and the local Republican spoke eloquently and intelligently about the complexities of city and county government, and the questions that the next representative of AZ CD8 would face. The Republican Chairwoman, however, kept referring to Obamacare, Obama, and Nancy Pelosi.

The Republican party isn't interested in Arizona or Pima County, they're interested in beating Obama, even in a special election for the replacement of Rep. Giffords.

Fundamentally, the Republican party created the idea of a personal mandate and pursued it as a middle-ground answer to our healthcare system, creating a market rather than generating a single-payer system. However, since a Democrat was successful, they've run away from it, calling it socialism while they run further to the right.

And, the Republican party has done this on every other issue, running hard to the right on the use of torture, running hard to isolationism when the US engaged Libya, running towards Wall Street to defeat Dodd-Frank and the CFPB, and running towards big oil for Keystone XL while disrupting the DoD's 'green' fuels programs.

The Republican party is fundamentally uninterested in governing and fiscal conservatism is just the aegis they've decided to carry this term. During the Bush administration Cheney said "deficits don't matter" and they cheered and blew a billion dollars a day in Iraq while giving most of it to companies that Cheney, et. al. had connections to.

If you want good government, don't vote for the RNC candidates, they're chimeras.

MadeTheSwitch

Jun 10, 2012, 05:06 AM

Elections matter and Obama lost his mandate in 2010. I actually hope he wins again and the Republicans win the Senate. That will give him some freedom from the left and actually get things done. Clinton did it.

Considering the Republican's priority has been abortion mostly since the 2010 elections (and not jobs), I'd hate to see what a Republican majority on both sides of congress would look like. DADT back on the table? DOMA propped up? More abortion bills? Repeal of healthcare without offering a plan of their own? More gridlock? No thanks.

As far as "Clinton did it", you do realize that things have changed since then and it's a completely different (i.e. uncooperative) Republican party now, right?

citizenzen

Jun 10, 2012, 10:27 AM

As far as "Clinton did it", you do realize that things have changed since then and it's a completely different (i.e. uncooperative) Republican party now, right?

While Republicans have ramped up their tactics with Obama, they certainly gave Clinton a healthy dose of them. Remember when Hillary Clinton complained of a "vast right-wing conspiracy"?

A lot of people laughed at that assertion then. I think she had it right. And that the difference these days is that the right wing doesn't care if it's out in the open for everybody to see.

jnpy!$4g3cwk

Jun 10, 2012, 11:04 AM

RINOs

Snowe was never a Republican while in office, only while running for office.

Yes, it is kind of funny how every Republican from Abraham Lincoln to Teddy Roosevelt, and then again, from Eisenhower to Nixon, would be a "RINO". Even "GHW" is questionable. There's Reagan, "W" sort of (too liberal), and, this year's crop of movement conservative Tea Party right wing Republicans as the only true Republicans. The rest were RINOs. The only thing I don't get is why people like you are determined to make the 1% even richer at your own expense. We already live in the New Gilded Age.

MadeTheSwitch

Jun 10, 2012, 06:19 PM

While Republicans have ramped up their tactics with Obama, they certainly gave Clinton a healthy dose of them. Remember when Hillary Clinton complained of a "vast right-wing conspiracy"?

A lot of people laughed at that assertion then. I think she had it right. And that the difference these days is that the right wing doesn't care if it's out in the open for everybody to see.

Not only that, they don't care if they even put the credit rating of the U.S. into jeopardy. The Republicans never would have dug their heels in like that and let that happen back in the Clinton years, but they sure have no problem doing it now. Everything is so much more polarized now. With everyone, not just congress. I blame partisan media, fanning politics like it was some sort of sporting event with everyone rooting for their home "team". It doesn't help that people have become so jaded that they tune out and let politicians get away with saying blatant lies as if they were fact.

citizenzen

Jun 10, 2012, 07:31 PM

Not only that, they don't care if they even put the credit rating of the U.S. into jeopardy. The Republicans never would have dug their heels in like that and let that happen back in the Clinton years ...

I remember that they were pretty stubborn back then as well. Just for you I dug up a cartoon I drew back in November 1995 that reflected the lack of compromise going on at the time.

And yes ... that's supposed to be Bill Clinton on the left and Newt Gingrich on the right.

MadeTheSwitch

Jun 11, 2012, 09:21 PM

I remember that they were pretty stubborn back then as well. Just for you I dug up a cartoon I drew back in November 1995 that reflected the lack of compromise going on at the time.

And yes ... that's supposed to be Bill Clinton on the left and Newt Gingrich on the right.

Stubborn, yes. At a risk to the country, no. They knew the boundaries and limits. Now people have no problem throwing the baby out with the bath water. And therein lies the problem. If people don't see the difference between then and now, I'm not sure what else to say. The difference is rather stark.

MorphingDragon

Jun 11, 2012, 11:56 PM

How is that any worse than what we are doing now? We need more money, ok just print it and drive down the value of the dollar. If it was so easy to just print money why are we in debt.

Because America spends money faster than the fastest photocopier. :D

thewitt

Jun 12, 2012, 01:03 AM

The only thing I don't get is why people like you are determined to make the 1% even richer at your own expense. We already live in the New Gilded Age.
Just continuing the fight against socialism and the total loss of personal liberties.

Your government wants to take it all away and redistribute wealth - which is not theirs to take in the first place.

Go back and read the history of how this country started and tell me the confiscatory policies of this administration are any different than what triggered our revolt from England.

hulugu

Jun 12, 2012, 01:27 AM

Just continuing the fight against socialism and the total loss of personal liberties.

Your government wants to take it all away and redistribute wealth - which is not theirs to take in the first place.

Go back and read the history of how this country started and tell me the confiscatory policies of this administration are any different than what triggered our revolt from England.

If this country couldn't get it's dander up after the Bush administration started its warrantless wiretapping, extraordinary renditions and outright torture, it would be a significant comment on the American mindset that a shift back to the taxation of post-WWII was worthy of a new revolt.

The administration's policy with regard to ACA is different, but hardly "taxation without representation" since it was created by the House and Senate and not King George.

And, as usual your posts are the crashing symbols of cliche and nothing more.

MorphingDragon

Jun 12, 2012, 01:31 AM

iJohnHenry

Jun 12, 2012, 07:04 AM

Because America spends money faster than the fastest photocopier. :D

Don't forget, they print them 32-up. ;)

As they are no longer on the Gold Standard, that money is backed by the Labour Standard.

And children forever will be paying it off by the sweat of their brow.

rdowns

Jun 12, 2012, 07:13 AM

Socialism=Get that black dude out of our White House.

MorphingDragon

Jun 12, 2012, 07:42 AM

And children forever will be paying it off by the sweat of their brow.

Is a man not entitled to the sweat of his brow?

No says the man in Washington, it belongs to the "Job Makers".
No say the Marxists, it belongs to everyone.
No say the Capitalists, it belongs to the Banks.
No says the Church, it belongs to God.

mcrain

Jun 13, 2012, 09:40 AM

So why does the US economy stink?

Why has job creation in America slowed to a crawl? Why, after several months of economic hope, are things suddenly turning sour? The culprits might seem obvious – uncertainty in Europe, an uneven economic recovery, fiscal and monetary policymakers immobilized and incapable of acting. But increasingly, Democrats are making the argument that the real culprit for the country's economic woes lies in a more discrete location: with the Republican Party.
...
Beyond McConnell's words ("The single most important thing we want to achieve is for President Obama to be a one-term president."), though, there is circumstantial evidence to make the case. Republicans have opposed a lion's share of stimulus measures that once they supported, such as a payroll tax break, which they grudgingly embraced earlier this year. Even unemployment insurance, a relatively uncontroversial tool for helping those in an economic downturn, has been consistently held up by Republicans or used as a bargaining chip for more tax cuts. Ten years ago, prominent conservatives were loudly making the case for fiscal stimulus to get the economy going; today, they treat such ideas like they're the plague.

Traditionally, during economic recessions, Republicans have been supportive of loose monetary policy. Not this time. Rather, Republicans have upbraided Ben Bernanke, head of the Federal Reserve, for even considering policies that focus on growing the economy and creating jobs.

And then, there is the fact that since the original stimulus bill passed in February of 2009, Republicans have made practically no effort to draft comprehensive job creation legislation. Instead, they continue to pursue austerity policies, which reams of historical data suggest harms economic recovery and does little to create jobs. In fact, since taking control of the House of Representatives in 2011, Republicans have proposed hardly a single major jobs bill that didn't revolve, in some way, around their one-stop solution for all the nation's economic problems: more tax cuts.

...

As Paul Krugman wrote earlier this week, in the New York Times, while a Democrat rests his head each night in the White House, the United States is currently operating with a Republican economy. After winning the House of Representatives in 2010, the GOP brokered a deal to keep the Bush tax cuts in place, which has reduced the tax burden as a percentage of GDP to its lowest point since Harry Truman sat in the White House. At the insistence of the White House, Congress also agreed to extend unemployment benefits and enact a payroll tax cut – measures that provided a small but important stimulus to the economy, but above all, maintained the key GOP position that taxes must never go up.

But as Congress giveth, Congress also taketh. The GOP's zealotry on tax cuts is only matched by its zealotry in pursuing austerity policies. In the spring of 2011, federal spending cuts forced by Republican legislators took much-needed money out of the economy: combined with the 2012 budget, it has largely counteracted the positive benefits provided by the 2009 stimulus.

Subsequently, the GOP's refusal to countenance legislation that would help states with their own fiscal crises (largely, the result of declining tax revenue) has led to massive public sector layoffs at the state and local level. In fact, since Obama took office, state and local governments have shed 611,000 jobs; and by some measures, if not for these jobs, cuts the unemployment rate today would be closer to 7%, not its current 8.2%. In 2010 and 2011, 457,00 public sector jobs were excised; not coincidentally, at the same time, much of the federal stimulus aid from 2009 ran out. And Republicans took over control of Congress.

...
This is the most obvious example of how austerity policies are not only harming America's present, but also imperilling its future. And these spending cuts on the state and local level are matched by a complete lack of fiscal expansion on the federal level. In fact, fiscal policy is now a drag on the recovery, which is the exact opposite of how it should work, given a sluggish economy.

This collection of more-harm-than-good policies must also include last summer's debt limit debacle, which House speaker John Boehner has threatened to renew this year. This was yet another GOP initiative that undermined the economic recovery. According to economists Betsey Stevenson and Justin Wolfers, "over the entire episode, confidence declined more than it did following the collapse of Lehman Brothers Holdings Inc in 2008." Only after the crisis did the consumer confidence stabilize, but employers "held back on hiring, sapping momentum from a recovery that remains far too fragile." In addition, the debt limit deal also forced more unhelpful spending cuts on the country.

Since that national embarrassment, Republicans have refused to even allow votes on President Obama's jobs bill in the Senate; they dragged their feet on the aforementioned payroll tax and even now are holding up a transportation bill with poison-pill demands for the White House on environmental regulation.

Yet, with all these tales of economic ineptitude emanating from the GOP, it is Obama who is bearing most of the blame for the country's continued poor economic performance.

Whether you believe the Republicans are engaging in purposely destructive fiscal behavior or are simply fiscally incompetent, it almost doesn't matter. It most certainly is bad economic policy and that should be part of any national debate not only on who is to blame for the current economic mess, but also what steps should be taken to get out from underneath it.

The entire article is worth reading... at the Guardian (http://www.guardian.co.uk/commentisfree/2012/jun/09/did-republicans-deliberately-crash-us-economy).