EMAIL SIGN UP!
Most Popular This Week
- Wisconsin Bill Would Treat Organic Milk, Sharp Cheddar, Brown Eggs as "Junk Food"
- Patent Filing Claims Solar Energy ‘Breakthrough’
- Climate Change's 'Evil Twin': Ocean Acidification
- Disaster Capitalism Strikes as Hedge Funds Circle Near-Bankrupt Municipalities Like Vultures
- Ignoring Bee Crisis, EPA Greenlights New 'Highly Toxic' Pesticide
- Patent Filing Claims Solar Energy ‘Breakthrough’
- Wisconsin Bill Would Treat Organic Milk, Sharp Cheddar, Brown Eggs as "Junk Food"
- Climate Change's 'Evil Twin': Ocean Acidification
- In 'March Toward Disaster,' World Hits 400 PPM Milestone
- Ignoring Bee Crisis, EPA Greenlights New 'Highly Toxic' Pesticide
Popular content
Today's Top News
Debt-Ceiling Deal's Cuts Could Crash Economy
Negotiating with crazy people is always a bad idea and negotiating with hostage-takers is dangerous. But negotiating with crazy hostage-takers is worse than dangerously bad. The “debt-ceiling” deal being negotiated to keep the economy from being crashed could crash the economy anyway. Making draconian cuts could throw us into another recession -- one that would be much, much harder to get out of because we have used up many of our recession-fighting tools.
Withdrawing government spending literally “takes money out of the economy.” Democrats should instead offer the country a plan to invest in We, the People by modernizing our infrastructure, improving our schools, making us energy self-sufficient, improving our social safety net and restoring our manufacturing and key industries thereby making American businesses more competitive in the world economy. Propose this instead of painful cuts the benefit only the rich and take it to the country.
From Paying Off Debt To Massive Debt In Ten Years
Ten years ago the government had huge surpluses and was on a path to paying off the entire debt. What changed? Ten years ago last week the Bush tax cuts passed. Republicans promised the tax cuts would create jobs and grow the economy. Instead the economy had one of the slowest periods in our history, creating very few new jobs and causing stagnant wages, leading to huge personal debt. (But the rich got dramatically richer.) And those cuts, along with huge military increases, two wars all leading up to an economic crash caused by deregulation and mismanagement, caused the country's debt to exploded. Taking office with a surplus of more than $250 billion, Bush left office with a $1.4 trillion budget deficit for his final budget year.
Debt Limit Reached
Now the United States has reached the Congressionally-authorized borrowing limit and is heading towards default. The White House is negotiating an increase in this limit with the very people who exploded the debt, people who have a vested interest in killing the economy so they can win the next election, and their budget-cut proposals would do just that. It is suddenly dawning on lots of people that this whole enterprise of austerity, taking trillions out of the budget – and therefore out of the economy – is a very, very dangerous proposition.
Cuts Make Economy Worse
Withdrawing government spending literally “takes money out of the economy.” We have a crisis because of lack of demand. Republican solutions of giving the wealthy and corporations even more money and tax cuts obviously will not work because the rich don't create jobs, we do. The rich are already richer than ever, with a greater share of the income and wealth than ever, and giant corporations are already sitting on tons of cash.
So with the stimulus winding down, and state and local budget cuts causing layoffs of teachers, firefighters and other government employees, Republicans are demanding even more layoffs from federal budget cuts as a "cure." But cutting government as a prescription for creating jobs sounds a lot like their claim that cutting taxes increases revenue. The problem is a lack of demand, and budget cuts taking hundreds of billions out of the economy only makes that worse.
In a front-page story last week, Economy’s Woes Shift the Focus of Budget Talks, the NY Times sounded the alarm that things are not going well,
Recent signs that the economic recovery is flagging have introduced a new tension into the bipartisan budget negotiations, giving rise to calls especially from liberals to limit the size of immediate spending cuts or even to provide an additional fiscal stimulus.
... More broadly, however, the signs of an economic slowdown in past weeks — not least Friday’s report showing weak job growth in May — have altered the climate for those talks. Amid the emphasis in Washington on significant deficit reductions, ... some Democrats, economists and financial market analysts are raising concerns that too much fiscal restraint this year and next could further undermine the recovery.
Democrats are also noticing that agreeing to cuts demanded by Republicans could well have an effect on their chances in the next election.
“I think Obama himself is going to have to move or he’s going to risk losing the next election,” said Mark Weisbrot, a liberal economist and a co-director of the Center for Economic and Policy Research. “He’s going to have to say clearly that the federal government has to step in when the economy is so weak,” regardless of whether his proposals can pass in the Republican-controlled House.
Republican economist Martin Feldstein’s recent op-ed in the Wall Street Journal, The Economy Is Worse Than You Think, also warned how bleak the economy looks and what the prospects are. (Of course, Feldstein argues for Republican plutocratic solutions: cut taxes, Social Security and Medicare.) From the op-ed:
The drop in GDP growth to just 1.8% in the first quarter of 2011, from 3.1% in the final quarter of last year, understates the extent of the decline. Two-thirds of that 1.8% went into business inventories rather than sales to consumers or other final buyers. This means that final sales growth was at an annual rate of just 0.6% and the actual quarterly increase was just 0.15%—dangerously close to no rise at all. A sustained expansion cannot be built on inventory investment. It takes final sales to induce businesses to hire and to invest.
The picture is even gloomier if we look in more detail. Estimates of monthly GDP indicate that the only growth in the first quarter of 2011 was from February to March. After a temporary rise in March, the economy began sliding again in April, with declines in real wages, in durable-goods orders and manufacturing production, in existing home sales, and in real per-capita disposable incomes. It is not surprising that the index of leading indicators fell in April, only the second decline since it began to rise in the spring of 2009.
The data for May are beginning to arrive and are even worse than April's. They are marked by a collapse in payroll-employment gains; a higher unemployment rate; manufacturers' reports of slower orders and production; weak chain-store sales; and a sharp drop in consumer confidence.
Feldstein even agreed that the stimulus was not enough,
As for the "stimulus" package, both its size and structure were inadequate to offset the enormous decline in aggregate demand. The fall in household wealth by the end of 2008 reduced the annual level of consumer spending by more than $500 billion. The drop in home building subtracted another $200 billion from GDP. The total GDP shortfall was therefore more than $700 billion. The Obama stimulus package that started at less than $300 billion in 2009 and reached a maximum of $400 billion in 2010 wouldn't have been big enough to fill the $700 billion annual GDP gap even if every dollar of the stimulus raised GDP by a dollar.
The investment community is taking notice, too. From Reuters: Deficit cut would trim growth: BlackRock's Fink,
A $4 trillion reduction of the U.S. budget deficit, if enacted by Congress, would trim economic growth by one percentage point a year for the next decade, BlackRock (BLK.N) Chief Executive Laurence Fink said.
With analysts already forecasting modest growth of 2 percent to 3 percent annually, that would leave the United States with an economy expanding at only about 1 percent a year, Fink said at the Morningstar investment conference on Friday.
Fink, however, argues that the government should do it anyway, along with cutting corporate taxes.
Cuts Make Deficit Worse
In a blog post, Thoughts on Voodoo, Paul Krugman explains (with some math) why austerity right now doesn’t help, and only makes deficits worse,
There’s a quite good case to be made that austerity in the face of a depressed economy is, literally, a false economy — that it actually makes long-run budget problems worse.
[. . .]How big do these negative effects have to be to turn austerity into a net negative for the budget? Not very big. In my example, the real interest payments saved by a 1 percent of GDP austerity move are less than .02 percent of GDP; if the marginal tax effect of GDP is 0.25, that means that a reduction of future GDP by .08 percent is enough to swamp the alleged fiscal benefits. It’s not at all hard to imagine that happening.
In short, there’s a very good case to be made that austerity now isn’t just a bad idea because of its impact on the economy and the unemployed; it may well fail even at the task of helping the budget balance.
My recent post, See WHY Austerity Can't Reduce The Deficit links to the equations that explain the background of Krugman's (and others') concusion,
OK, so we have a $100 GDP with $10 deficits and we want to cut that to $5. Kash explains that a $5 spending cut means (by definition) that GDP immediately drops $5, and this (by definition) $5 drop in consumer income makes tax revenue drop as well (as well as a further drop in GDP). After some calculations (go to the post) Kash shows that a $5 cut makes deficits drop to 7.4%, not 5%, but GDP also drops quite a bit - maybe 7 or 8%. Seriously, go see the calculations, they are not difficult.
Just cutting people out of the economy doesn't fix the problem, it shifts the problem and eventually will kill the economy.
Stimulus Worked -- But Was Not Enough
Here is the timeline you see on this chart:
- First, there is the Bush freefall, from the policies Republicans want to return to
- then the effect of the stimulus spending reverses the decline, bringing back job growth
- then the stimulus winds down, and job growth levels out
- and combined with state & local budget cutbacks -- spending cuts, which Republicans want more of -- job growth stalls. (Note that this chart is private sector only doesn't show effect of government job losses.)
Jobs Fix Deficits
Jobs fix deficits. Restoring good-paying jobs starts to restore the tax base and stops the emergency spending on the unemployed. The increased demand as people find work and paychecks revives retail and manufacturing. Housing recovery, for example, depends on more jobs. But with unemployment high and wages are low, so many people just can't afford to buy -- or keep -- a house.
Only The "Pain Caucus" Benefits From Cuts
In the recent op-ed, Rule by Rentiers, Krugman explains that these budget-cut austerity policies help a small, select group. He calls them "the pain caucus."
The latest economic data have dashed any hope of a quick end to America’s job drought, which has already gone on so long that the average unemployed American has been out of work for almost 40 weeks. Yet there is no political will to do anything about the situation. Far from being ready to spend more on job creation, both parties agree that it’s time to slash spending — destroying jobs in the process — with the only difference being one of degree.
. . . Consciously or not, policy makers are catering almost exclusively to the interests of rentiers — those who derive lots of income from assets, who lent large sums of money in the past, often unwisely, but are now being protected from loss at everyone else’s expense.
. . . While the ostensible reasons for inflicting pain keep changing, however, the policy prescriptions of the Pain Caucus all have one thing in common: They protect the interests of creditors, no matter the cost. Deficit spending could put the unemployed to work — but it might hurt the interests of existing bondholders. More aggressive action by the Fed could help boost us out of this slump — in fact, even Republican economists have argued that a bit of inflation might be exactly what the doctor ordered — but deflation, not inflation, serves the interests of creditors.
[. . .] No, the only real beneficiaries of Pain Caucus policies (aside from the Chinese government) are the rentiers: bankers and wealthy individuals with lots of bonds in their portfolios.
Cuts Cold Cost Election
Policies of austerity cause large-scale suffering -- done now to avoid restoring tax rates at the top. Budget cuts are asking the public to take the hit, through cuts in programs for us, for among other things the cost of bailing out Wall Street.
Republicans understand that the public will blame Obama for the cuts and are certainly planning on using the resulting lack of jobs in the next election. Remember, in the 2010 midterms they campaigned and won using a theme that Democrats were to blame for “$500 billion in Cuts to Medicare”.
The conservative noise machine is already claiming that Obama is harming Social Security. For example, see last week's Obama busting Social Security by conservative Don Surber,
Having cut employee contributions by one-third, the president now wants to cut employer contributions in a desperate CYA to cover up the Obamess Economy.
Public Wants A Different Solution
The American Majority wants the same solutions that economists agree work better for more people. The public wants tax increases on the rich. They want direct job creation by government. They want a revival of American manufacturing. They want a national industrial/economic policy. They understand that growing the economy reduces the deficits.
Austerity is about intentionally causing suffering, so a wealthy few benefit. But investing in our country to create jobs, modernize our infrastructure, improve our schools, make us more energy self-sufficient will not only make our country more competitive in the world economy will improve the lives of We, the People. Obviously this is the better choice, and a significant percentage of the public will have Democrats' back if they offer this plan.
The Congressional Progressive Caucus' People’s Budget is the template for a job-creating deficit solution. The Progressive Caucus is a group of progressives in the Congress who have put together a budget that fixes the deficit and grows the economy, providing jobs. It is called The PEOPLE'S Budget Plan. You can read the plan at: Congressional Progressive Caucus : FY2012 Progressive Budget,
The CPC proposal:
• Eliminates the deficits and creates a surplus by 2021
• Puts America back to work with a “Make it in America” jobs program
• Protects the social safety net
• Ends the wars in Afghanistan and Iraq
• Is FAIR (Fixing America’s Inequality Responsibly)What the proposal accomplishes:
• Primary budget balance by 2014.
• Budget surplus by 2021.
• Reduces public debt as a share of GDP to 64.1% by 2021, down 16.5 percentage points from a baseline fully adjusted for both the doc fix and the AMT patch.
• Reduces deficits by $5.6 trillion over 2012-21, relative to this adjusted baseline.
• Outlays equal to 22.2% of GDP and revenue equal 22.3% of GDP by 2021.
Beyond the people's budget we need a massive investment in infrastructure modernization. This infrastructure work has to be done anyway, no matter what. The longer we delay it the more our country falls behind. It is millions of jobs that need doing at a time when millions need jobs! (And by the way the government can borrow at nearly zero interest rates right now -- one more reason to do it now.)
The Republicans are demanding that we cut and gut our government and therefore our economy in exchange for keeping the country from defaulting on its debts. The deal they are demanding will do just as much harm as default. Instead we need to invest in We, the People with jobs and infrastructure that enable us to grow our way out of this mess.
Actions
Tell President Obama to put the People's Budget on the table.
Comments
Note: Disqus 2012 is best viewed on an up to date browser. Click here for information. Instructions for how to sign up to comment can be viewed here. Our Comment Policy can be viewed here. Please follow the guidelines. Note to Readers: Spam Filter May Capture Legitimate Comments...
55 Comments so far
Show AllThe lack of attention to Imperial activities in this article is glaring. No where is there a demand to cease those activities as a major solution to the nation's economic malaise. Almost the entirity of the discussion focuses on "removing government funds from the economy," which incidentally is exactly what ceasing its Imperial activities would do--Unless--those funds are redirected into the non-Imperial part of government spending.
Also, no mention in this article, is the fact that "austerity measures" are the final blow by design, to decimate the middle class, so oligarchy can flourish. All domestic surveillance capabilities are in place, and so are the means to swiftly curtail any outbreak of an "American Spring", that might well up from the finally awakened displaced economic class refugees, e.g., newly poor.
Norquist's dream, as Republican philosophy is nearly realized. Democrats in general, either sat back in the margins and let it happen, or bought that cheap ticket of taxcutspeak and nationalsecurityspeak, just to get that government job. I hold my disdain primarily for Obama, and the current leadership of the Democratic party, who are clearly just the worst examples of political culture rot. They are aware of, and versed (as a con artist knows the appropriate vernacular according to efficient conning) in progressive rationales regarding the economy, war and peace, environment, etc., but have either chosen not to stand up for them, or willingly joined in on "the game".
The fashion of fascism has run amok, and many of its cohorts are blissfully unaware of their own involvement. They look, around their DC office, or ponder their role over a nice dinner, and think, "well, I need mine so I'll keep mine, and things always have a way of working out, right? I mean, why should I stick my neck out! I'm a Barbara Boxer, or some other pampered political schmuck."
That kind of cognitive dissonance of the rich and powerful who knows better is another example of the banality of evil.
The others that I allude to, don't even have to burn a single mental calorie in any cognitive dissonance laced justification for their existence. They are one rung up the ladder of money worshiping, blood thirsty, agents of darkness.
I would say the oligarchy is already flourishing. Indeed, I would go further, and have, to say they are flourishing by the design incorporated into the 1787 constitution that placed them in a dominant position--a position yet to change. To paraphrase from Lapham's essay, the purse's appetite is infinite--there is never enough for those already possessing too much. And such traits are always. conspicuous within Empires. And as the author of "The Collapse of Complex Societies" noted, today's interconnected complexity is such that the only way collpase will occur is when the whole artiface collapses; which is to say, that the US Empire will collapse when its planetary support systems do because there is NO civil society existing capable of retrieving the car that's already plunged into the abyss.
Why did CD choose to publish this piece of crap? My God, do we really have to be this insulted? This fool of an author acts as if this little explanation would be helpful, that somehow the Obama administration forgot all that about helping out mainstreet and rebuilding the infrastructure with work projects blah blah. He probably just needs a reminder? Oh, those ideas are SO pre-election.
Information is very necessary ,leading to an informed and educated revolution. Being ignorant or without information leads to the status quo. Try harder to stifle your anger and open your mind to learning.
This article contains some very factual information, missing only the criticism of the sick and dying political system that refuses to take the necessary steps to lead us out of the wilderness. I guess we will simply wait for things to get so bad that an uprising spontaneously erupts.
OK, maybe I was a bit out of line. My frustration comes from the fact that the information in this article is retread of something any reader of economics should know by now, and yet, as you say, we are beset by a broken political system that has an agenda that does not seem interested in taking the necessary steps. At this point, this is the news that needs to get out: current policy is designed to break the US citizenry, to impoverish the US worker/consumer, for the sake fo war profiteering and building fortunes elsewhere.. Saying what the government should do is like telling a sociopathic murderer that s/he should not kill people. Does a lot of good!
But we are engaged, after all, those of us committed to change, in a process of education are we not? That the media is owned and operated solely for the benefit of the ruling corporate class is a moot point. That we then must use every means necessary to change the minds of the brainwashed, our fellow citizens, seems important.
This article is certainly a bit centrist and I prefer to praise it for the points it raises rather than for the solutions it omits.
"Tax Cuts, Wars Account for Nearly Half of Public Debt by 2019"
"The CPC proposal:
• Ends the wars in Afghanistan and Iraq"
How's your reading comprehension?
I didn't say it was omitted, as you imply. I said the article paid it scant--"little"--attentiion. And I read very well, thank you.
I don't see "scant" or "little" in the original 12:25 comment. Am I missing something? It was that first comment that started the chorus singing. I will look again to see if I can spot the words. How'm I doing, Liz, for a dyslexic on a mobile keypad?
The exact word I employed was "lack" leading the phrase "lack of attention." The word and phrase are synonymous with little and scant, with the implication that the subject was addressed but not with the seriousness required.
"Debt-Ceiling Deal's Cuts Could Crash Economy". Wrong title.
Correct title: Debt-Ceiling Deal's Cuts WILL Crash Economy.
"Making draconian cuts could throw us into another recession..." Wrong hypothesis.
Correct hypothesis: Making draconian cuts WILL throw us into another DEPRESSION.
"Democrats should instead offer the country a plan to invest in We, the People..."
But they WON'T, will they? Instead, they will obey their corporate masters and cave in to the stupid republicans.
"Tell President Obama to to put the People's Budget on the Table". HA ha ha HA HA... Ho Ho! Good one!
This article is typical of what passes for thinking in the US. First, sugar-coat and understate the problem, then propose a manifesto of sensible ideas that are never going to happen and, finally, wish for the democrats to enact the manifesto, which amounts to waiting for frogs to grow wings and fly. But I guess that's what one should expect from an outfit called "Campaign for America's Future".
Get real. US democracy is dead, World War III has begun and economic "growth" is over. America has no future, at least not one worth campaigning for.
What do you mean you have no "personal stake"?
If tons of popcorn keeps you happy on this "worthless ball of dust called planet Earth" you have everything you need... so far.
Hello chaokoh,
I really liked your comments but we really didn't pull out of a depression but stopped it from going deeper. We might have started upward but it was cut short. We will go into the deepest depression in the history of the US when these cuts are made. If insanity is defined as doing the same thing over and over and expecting a different result then the US is totally certifiably insane.
Don't worry, you'll all get pie in the sky when you die! Jayzeus sez so, it's in the bible, so I believe it! (not that I have any choice given the quality of the options presented by those who are being paid by the corporate masters to fuck us all...)
The destruction of our Democracy for an Aristocracy is the goal.
Our Corporate Controlled Congress is just playing at government.
With due deference to karlof1 and hue_sir_name, who highlight a problem of disunity among some progressives, what troubles me most is that no candidate for president in either major party -- no one who is likely to get any publicity in the MSM -- advocates progressive views. Time is running out. Perhaps the only hope now is 2016, unless progressives get fired up enough to jump start something.
I really don't want to sound defeatest, but IMO time has already run out. That conclusion is based on my study of history, science, and our contemporary situation. The Barbarians have "won." Their winnings will be collapse of the global system, including its ecological systems; which is to say, their victory is Pyrrhic. The Barbarians seem to think they'll be able to leave the confines of earth for some other planet or moon as suggested in science fiction. Not too many centuries ago, such Barbarians would be able to survive because the planetary environment was stable, but that wil not be the case in just a few decades. In the end, they will belatedly realize they have consummed themselves in their orgy of conspicuous consumption.
Reluctantly, I agree with you karlof1. I garden, buy $10 worth of extra groceries each week to build the larder, pantry, don't buy any new clothes anymore, ever. Well, except underpants. My children think I am crazy but they'll thank me later. No cellphones,no TV at home(keeps the electric bill down) I do buy spare bike tires and inner tubes, though I don't ride much yet. I'm becoming an exercise freak, which is startling the kids again and they are getting really pissed off I unplug the computer when I'm done with it. The nutty part is even though they complain the house is a "dump" (not filled with the latest consumer goods or fads) and I "never have anything good to eat"( advertised on TV) I literally have at least one of their friends here at all times, though more frequently it is 3 or more at any given point in the day. This is knowing the rule that if you're here, you're fair game for chores. The husband and I are consulted routinely by all parties about minutiae and the profound alike. Go figure. So yes I am a pessimist about Empire driving us into collapse and not very optimistic about my/our abilities to navigate the changes but I am driven to keep doing my best to offset it as best as I can.
Although you may not have intended such, thanks for the little bit of inspiration. I needed it today.
You guys (?) won't get anywhere if you spend all your time figuring out why progressives can't succeed in presidential politics. Look at the Republicans last night -- why can't we have a bunch of progressives presenting themselves to progressive audiences so that we can see who is the strongest candidate? (Granted, the MSM won't take notice unless/until someone really impressive takes the lead.) I think it can be done, but not by people who aren't willing or able to make it happen.
That was a staged media event, much like a photo-op propaganda opportunity like Obama's factory visit, reminding me of the shows What's My Line? or Hollywood Squares.
Thanks for your reply, netminnow. Your response to current conditions is apt; there is no need to stop enjoying your priceless life; indeed, I find living more vital than ever. I believe the best we can strive for is to be the epitome of Civilized except to the Barbarians, who more than deserve our scorn, and worse. An educational tool I suggest to anyone with kids--of any age--is the Oil Age/Peak Oil poster, http://www.oilposter.org/images/xtralargeposter.gif Just tack it to the wall in a somewhat dominant spot, and it will speak for itself. And it's also clear you care, which a behavior truely Civilized people have and employ--they don't just talk the talk like Obama and ilk. My best to you!
Thank you for the glimpse into your own personal revolution. Perhaps this may prove to be the road to success in our struggles. I cannot overcome my own preferences for community actions however, as they reach a wider audience.
US should try it's own medicine which has been showed down the throats of millions of people around the World for decades by it's satrap IMF - structural adjustment, austerity measures. The medicine might even benefit Amuricans vegetating in a media induced coma by waking them up, and bringing them back to their senses. Cut baby, cut!
Be careful what you wish for. That's exactly what the US IS doing.
I applaud the use of the graph showing the level of debt incurred by Tarp, Fannie, and Freddie. Many people assume this was the biggest or one of the biggest reasons that our deficit is growing. But the graph shows the tiny difference this made. The Bush tax cuts were clearly the biggest economic mistake that Dubya made (even hugely bigger than having tons of bales of hundred dollar bills stolen in Iraq).
Please explain why the graph is 'wrong.' I think you are like a great many who do not have a clear understanding of our debt. Polls have clearly shown how a great many people do not have a clue as to which items are relatively important and which are but a drop in the bucket when it comes to the US debt and spending.
I don't know who the hell Borofsky is. Why do you put so much faith in this person? To say that the US is on the hook for $23 trillion because of tarp, Fannie and freddie is beyond unbelievable. Not every wild-eyed idea has any actual basis in fact. Oh, shit! I have to cut this short. The aliens are here to abduct me again. This is getting soooo old.
You said, 'Borofsky.' Now you say 'Barofsky.' Your article is far out of date. Tell me of someone who is not a nut who thinks we are CURRENTLY on the hook for $23 trillion for tarp, fannie, and freddie. Also, if "other federal programs" includes all future possible payments to SS and Medicare then this mumbo jumbo of bs is getting really deep.
Hee, a shame he wont get it.
"Republicans promised the tax cuts would create jobs and grow the economy."
Yes, they just forgot to mention that it would be China, India and other countries where the jobs would be created to grow THEIR economies.
I still believe that every cloud has a silver lining.
And every silver lining has a touch of grey...
We will get by
We will get by
We will survive
-Hunter/Garcia
"Crashing the economy" IS the plan.
Ding, ding, ding! Brian Brademeyer come on down! Barry, what is Brian playing for? A brand new clunker he can turn in for cash last year! Brian, the suspense is killing us, will you keep the clunker or choose Door #1 or Door #2? All part of Barry's Fabulous Let's Make a New Deal.
The Progressive Caucus has a plan that would work... but as Allen Dulles said about "flaws" in the Warren Commission Report... "nobody reads anymore".
” Democrats should instead offer the country a plan to invest in We, the People by modernizing our infrastructure, improving our schools, making us energy self-sufficient, improving our social safety net and restoring our manufacturing and key industries thereby making American businesses more competitive in the world economy. Propose this instead of painful cuts the benefit only the rich and take it to the country."
"Democrats" won't.
But a majority Progressive Democrat third party within the Democratic Party on the other hand, can do EVERYTHING, right NOW!
...if only liberals and progressives finish the job of voting out conservative Democrats.
Look, I am not rich myself and I only know a few rich people but what I do know about them is that all resent paying their taxes, feel they are unfairly burdened by them, feel that they don't see any benefit from them and will support any scheme that allows them to pay less in taxes. They don't care if it messes up the rest of the economy. They feel immune from any bad consequences of an economic downturn. They don't care about the welfare of the rest of the country. Add to this my own conjecture--they control the politics of Washington D.C. and you will see that they will get their way no matter whether it is good or bad for this country and its economy. We will suffer the consequences. Will it change the political climate--apparently not. Most of the misguided public does not see who is pulling the puppet strings. Most of the American public still believes Mitt Romney when he says that he as a businessman knows how to create jobs. Most of the Democrats are very cool to Obama when he says that he is on our side. Obama will likely be a one term president-but whether he is president or not the plutocratic rule of this country will continue and things will get worse for us. Great choice for 2012 Obama or Romney. Are you fired up and ready to go?
Historically speaking the level of civilization has always been achieved through taxation. Higher taxes provide higher civilization. Unfortunately the civilization we have now is destroying our ecosystem. Maybe the Republicans and corporate Democrats are doing the planet a favor by destroying the global economy. It will be an ugly mess but maybe the absurdity of the situation will force mankind to live with nature.
As much as I like the progressive budget proposal which would benefit “We the People” in the short run, in the long run it will only allow this crazy economy of ours to do more damage.
What I'd love to see happen is a plan to use this work horse of an economy to build sustainable systems with the plan of shutting down the growth based economy once all the needed infrastructure is built. This would require changing the concept of money. Money created by debt is the root of our economic and environmental problems. If the progressives had the balls enough to change how money is created then we could have high civilization and a planet to live on. Of course this would require a revolution of thought and action.
How low must we go before we wake up?
We need to absolutely say no to the GOP/Tea Party NOW. These folks have no positive anything to say except bash our President.
The buck has to stop now.
The infrastructure at home is a disaster so lets put a lot of people to work.
I remember from American History that there were big spending cuts after the first few years of the New Deal (maybe 1936-37?) because too many people got worried about "that man" (Roosevelt in those days) spending too much money. The result was a double dip back into depression that didn't end until the early 40's. Does that scenario remind anybody of today?
Let it tank, just like a drunk that needs to dry-out and sober up.
I cannot believe that folks are still talking as though an election or two will solve our problems. Our nation is so messed up, applying bandaids is NOT going to fix it. does no one remember that action which brought about this nation back in the late 1700s? I believe it was called a revolution. I hope the next one is nonviolent, but I truly think what we have become is a fascist nation run of, by and for the corporations and ain't no way it's gonna be fixed in the next election cycle.
Its the SYSTEM stupid ,that one called Capitalism . The world overproduces goods and there will never be enough demand for the the consumption of those goods.
The production of those goods and the economies that manufacture them rely on ever growing consumption of the same. Yet world resources are finite and as you consume more wealth is destroyed.
Increasing consumer spending is not the answer. Where will that lead in 20 years time? Do people really believe that a solution remains in keeping a "Healthy consumer" buying stuff at a store?
Now this does not suggest I believe all should live in penury. It means the system must be restructured so wealth more equitably distributed while at the same time the "Consumer Economy" and Capitalism dismantled.
The entire concept of money, debt, private property , capital and the like as we know it must become a thing out of our pasts.
Just to show how silly the concept of "debt and GDP growth " is.
It takes 6 dollars of DEBT to create a 1 dollar growth in the US economy today.
Its broken.
"It takes 6 dollars of DEBT to create a 1 dollar growth in the US economy today." This seems unlikely. Source, please.
>>http://goldsilverrealestate.com/?p=514
Dozens of such links but...
>>The Federal government borrowed and spent $5.1 trillion over the past four years to generate a cumulative $700 billion increase in the nation’s GDP. That means we’ve borrowed and spent $7.28 for every $1 of nominal “growth” in GDP.
Now keep in mind this is merely GOVERNMENT debt. This does not measure consumer debt so the numbers are even worse.
All you have to do is the math. It is not rocket science.
In the 1950s one dollar of debt used to create 1.36 in nominal gdp growth. If one goes further back it was a better ratio in favor of growth versus debt.
It is now well over 6 dollars debt to get 1 dollar gdp growth. Remember as well this is NOMINAL GDP growth. That means GDP Growth before inflation. This also where interest rates are at rock bottom meaning that has they rise the return on the debt dollar will drop even more as those rates rise. Inflation numbers are also being manipulated by the Feds so as to give the appearance there more in the way of Growth. When one factors in the subsidies going to agri-businesses to help keep the price of food low and compares what a dollar earned in 1960 could buy in the way of food versus a dollar earned today the true "increase in costs" is a lot more then the official "inflation rate"
Add to this the fact most citizens of the USA stored their "assets" in the value of their homes the prices of which still plummet and it should be clear that borrowing more monies to re-inflate those home values is just smoke and mirrors. It just builds another bubble that will pop again and each consecutive boom and bust debt based cycle has consequences more sever and concentrates even more wealth in the hands of the few.
Remember who it is that gets Rich off debt based economies. It is not the worker. It is the Investor class and in particular the ones at the very top of the pyramid.
I'm very short on time today. Whether your last 4 year numbers are correct or not, I do not know. However, that period was an exceptional time of spending. As of TODAY the government is spending less. I do not buy the "inflation numbers...manipulated by the Feds." Subsidies to agri-businesses do nothing at this time to keep food prices low. They used to. Now they just put money in the hands of many who do not need it. I don't get your talk of "borrowing more monies to reinflate those home values is just smoke and mirrors." Only one year ago a person could buy 56 pounds of corn for less than $3. Compare that to 10,20, 30, 40 years ago. It was nearly the same quite often in that time frame. And for that cash you can make one heck of a lot or tortillas, cornbread, etc. As far as losing out in pyramid schemes, as they say, a sucker born every minute.
Well said. My pray is that more and more people will begin thinking like you. Time for a "new economy." Thank you for sharing your thoughts.