OBAMA STIMULUS - THE END OF NEANDERTHAL ECONOMICS?

I hate to say this: the Beginning of the New Year seemed like a continuation in part of the 2008 disaster news. Businesses consider bankruptcy, states are out of money and cut back on law enforcement and education, car makers cant sell their products. In short: the lay-offs have it. --- While the picture gets dimmer and dimmer, the Neanderthal Economists in Area 51, Washington, announce that they will do anything to delay the passing of a stimulus package. Indeed, instead of concentrating on securing immediate stimulation, a core fundamental in Recession Economics 101, they rather concentrate on not seating a Senator who has been appointed by a Governor who has not been impeached, who has not been indicted, and where the prosecutor does not even have a case to obtain an indictment but hopes he will so in 3 months - maybe. Their argument: the Secretary of State has the power to rescind the action of a properly sitting Governor. Harry Reid initially went along with that argument. --- Harry, I found a piece of ancient Chinese advice: If you put a match between your legs your chestnuts will be roasted. --- Same with Obama. Obviously puzzled by Patrick Fitzgerald, the quick mouth prosecutor, Obama said in a press conference: Obama-son sorry that was Japanese here is another piece of ancient Chinese wisdom: If you tempt a squirrel with a nut, be prepared to be bitten. I dont make this up. It is from fortune cookies.
Sure enough, Blago Goldfinger appointed Ronald Burris as the Senator from Illinois.
Which got everybody upset. --- Let me say this again: The fact remains that Blago Goldfinger has neither been impeached nor even indicted. --- Back to the Neanderthal Economists objection to Obamas stimulus. Their argument: You, the tax payer, will have to pay for the stimulus. Not quite entirely. What these enemies of the public do not tell you is what you will have to pay if no stimulus passes. And that may include homelessness. If you think I am kidding, you do so at your own risk. --- Not only are states laying off public employees, cutting back on law enforcement as well as on teachers, they have no money for welfare.
--- I agree with Paul Krugman, the 2008 Nobel price winner for economics: In a recession government action has to be taken swiftly and to the extent needed. I also agree with Krugman that Obamas plan may not be bold enough. --- Allow me to call the Myth Busters in to explain again and maybe in more detail why we need to take swift action, what the macro-economic relationships are, and why as much as you may hate them taxes are needed, not only to pay for essential services like security, education and health, but to pay for measures that are needed to prevent a true economic disaster. The gross domestic product is the measure currently in use to judge the economic health of a nation. --- Next, you remember the donut which is the essence of macro-economy as much as this may make the cave age economists cringe. The donut describes not only the relationship between the players - but nicely depicts the monetary flow. As well as in a recession, depression, and on a global level. Not to forget the Government which is a major contributor to the economic health. Lets forget for a moment the Governments contribution to the economy via its employees and come right to the point of economic stimulus here one given to corporations. Macro-Economists say that this will increase employment which in turn will increase purchase power which in turn will increase buying and added tax revenues.
Except that if it comes to increase the purchase power of consumers - there is a delay caused by the corporate go-between. --- Unless there are compelling reasons, for example to save car makers, much more efficient would be to apply the stimulus directly to the consumer. Of course, that is only true if the consumer actually spends the money he gets and does not use it to pay off debt. Lets look for a moment at the Governments contribution to the economy typically overlooked by the Neanderthalers.

Indeed, if you look closer you will see that the government does not put the money in its savings account that would be the day but actually spends it by paying it to public servants, like firemen, police etc. --- So the next time some cave age economists the Hoover crowd comes and gives you stories, give them the bleeper. One more point though. Any stimulus plan would have a greater chance of success if it is combined with a bold plan to encourage innovation. That of course would require that we get our credit house in order and make credit available to venture capitalists. It would also require that we change the patent laws to exclude patents that are being used to restrain the trade. Such inventions do NOT contribute to the economy to the contrary.

Category:

News & Politics

Tags:

• HARRY
• REID
• BARACK
• OBAMA
• STIMULUS
• ECONOMY
• INFRASTRUCTURE
• EDUCATION
• GEORGE
• BUSH
• PAUL
• KRUGMAN

[garthggarth]

I am pretty sure that is why we aren't hearing about energy independence, and THIS IS IMPERATIVE FOR THE COMMON MAN TO UNDERSTAND: Of all the oil producers in the world, Russia and Venezuela have the greatest need for oil prices to be high. (as of 2007-8, Russia set thier budgetary needs at 95$/barrel, Venezuela around 75.)

Obama needs Russia's political weight in the India/Pakistan/Afghanistan fiasco. Plus, a violent move towards QUICK energy independence will result in market collapse.

[bvongrabe]

Actually, the way I lok at is this: the electrification of cars will not be an overnight thing, it will go over many many years because people will not discard their old cars momentarily. The problem with our dependence is demonstrated by Russia's instant stop to deliver gas to Europe, which brought many countries into problems. Only today, I hear, MAY they resume delivery. OPEC decided they would cut production which will result in higher gas prices. Think about it.

[mcgrawtim123]

Good video, but I think Krugman and the Keynesians are wrong. Austrian economics, the Ludwig von Mises Inst. and their sound money and free market policies are right. Ron Paul, Peter Schiff, and Dick Armey were all on TV today against the Obama plan. Well, the stimulus package will get passed, so we'll see who's economic theory is right. I like your donut, though. All the best, tjm

[bvongrabe]

Respectfully, when millions and millions of people are out of work the government HAS an obligation to take actions and should not sit back and say "tough luck!" - remember that in this case the government CAUSED the national debt by commencing a fraudulent war, and caused our dependence on foreign oil by inaction, the latter resulting in a massive reduction of purchase power that went to hostile nations - other causes not to exclude.

[bvongrabe]

Right on! Innovation creates wealth! And I will be bleeping tomorrow on another Neanderthaler I listened to today, a Harvard professor no less! God, I love proving these guys wrong. This will be better than cable!

[TheRougeEyelash]

For instance, we got a tax break (Februray I believe. Check your pay stubs) but we can't be relied on to spend this, or an even bigger tax break, to get things moving, we Do have debts to pay off or just knwo theres a need to save, so a tax break is only a small part of a sulution.

Didn't you catch the part about venture capitalists, and inovations? Yes indeed, stimulus.

[barthel6]

Obama Stimulus = Neanderthal Economics

[raigekimaru]

the stimulus is like lemonade. we need more, so we pour in more water, thus increasing the lemonade supply, but lowering the value of the lemonade. eventually, the lemonade is virtually nothing but pure water and not worth a dime to anyone. this is what will happen with our currency (like every single one of the 3800 fiat currencies before it), it will eventually go to its true value, a piece of paper. this will destroy our entire economic system as we know it. that's why I'm leaving ;D

[solgoode1]

actually the stimulus is like a turd... the more you squeeze it out, the more it stinks.

[pianista17mari]

"of course, that is if the individual doesn't use the money to pay off debt" (8:00). Translation: "that is, if most individuals are stupid and don't use the money to put their own house in order." Lol at the end! stimulus indeed?... lol

[nnossov]

and more than that.. a natural free market forces to this economy akin letting a man that is dehydrated and starved fend for himself.

[nnossov]

hmmm... actually the analogy of economy stimulus is this: war spending is an adrenaline boost to the body that will crash sooner or later. while infrastructure spending are actual calories that will take time to work into the body...

[microwavefc]

This started before the war, you can trace today's problems back to the 90's federal reserve lowering interest rates too low. The Keynesian's are provably wrong, stimulus packages only cause unsustainable debt. Krugman is a fraud anyway.

[davfritz]

The stimulus is like a runner who is worn out drinking coffee to energise himself to run a bit further. He will run further, but not for long. What he needs is calories - real energy, not caffine. Real energy in this case can only generate via natural freemarket forces, not government stimulus ei caffine