Recession Over, Big Government Not

Nothing quite like the smugness of a fair weather deficit hawk.

According to yesterday's New York Times the stimulus and Obama's agenda constitute a tiny percentage of the current deficit:

About 7 percent comes from the stimulus bill that Mr. Obama signed in February.

...

only 3 percent comes from Mr. Obama’s agenda on health care, education, energy and other areas.

The lion's share comes from the Bush era in which conservatives were in control of the Federal government along with Obama's extension of Bush policies such as the wars and tax cuts.

Granted, now that the deficit is gaining political traction it never enjoyed during the GOP era, it is tempting to jump on that bandwagon. But I prefer the Jon Henke of 2007/2008 who was one of the few on our side willing to challenge conservatives with the idea that our electoral failures were our own fault and to call on us to reassess and recraft not just of our message (deficit bad/big government bad) but also our practices (deficit bad/big government bad).

At least in the model where we bear the blame for our situation there can be some hope that conservatives control our own destiny. "Can it please stop now" indeed.

It's gotta drive conservatives crazy when a program they opposed works.  Of course cons will insist it didn't work because they all were against the stimulus, but that insistence only makes them look at odds with reality.

JD, do you hear yourself.  Everyone knows that Obama is trickling out stimulus in time for the 2010 elections.  His hope (as is yours) is that the stimulus will actually create jobs and people will be feeling oh so good about themselves such that they'll simply ignore those dastardly republicans.

Except....one big monkey wrench was thrown into the plan this week. 

The Fed is no longer buying Treasuries.....because they say that they want to keep long term interest rates low.....translation.....INFLATION.

So why did they suddenly stop...It was because the foreign investors said to stop.  If the Fed did not stop, then the Fed would be the only one bidding in the next Treasury auction.  In other words, a notice/ultimatum  was given to stop printing money in order to buy debt...and thus stop diluting the dollar.

What does that mean to the grand democratic plan....it means that they/you  have to start spending stimulus now.....instead of later.  This also means that they now have to come back for a second round of stimulus before the election. That's gonna set just peachy with america.

Oh, and as for your beloved DOW with a 40% uptick....that is because the stimulus was factored in....you know, 6 to 9 months LEI with the market.  Now that assumption is all out the door.

As for GM/Chrysler.......well just look at the old cash for clunkers program.  Heck, the owners of GM (Obama) can't even win that.  The last thing i knew was that Toyota, hyundai, Nissan, Ford was killing them in sales.  How idiotic is that.  The owners write the rules of the program...and they can't even win the game.  GM profitable next year.  Yikes, try 10 years if the government can even begin to pull out it's equity stake.

And you can't bet on american know how.  You can only bet on government know how.  America is too busy trying to figure out how to survive never mind innovate.

"Can we stop now?"  Umm, you really don't understand economics at all, do you?  Let's break this down.  The government wants to prop up the bottom of the recession.  It can't just throw money on the street and then when everyone goes out to spend it the next day say "hey, the recession is over (for today)."  Instead it allocates umpteen billion dollars to do so OVER TIME.  It figures dumping that money on the street for people to fight over is a bad idea and will only create a temporary uptick.  It therefore allocates the money to several different programs.  These programs ultimately pay employees either directly (labor for projects) or indirectly (consultants, laborers who build materials for the projects, etc.) OVER TIME, to complete various projects, which happen OVER TIME. 

Now, for example, we go and start building Road Project A with federal stimulus money, which is going to take 2 years to complete.  We don't give Road Project A money for guardrails, streetlights and asphalt yet, because they need to still survey the site, tear out the old road, grade the new road, etc.  That money will be sent to Road Project A when it needs it.  Anyone who understands business knows that you don't pay for something now that you don't need now.  What is happening is that the private company that builds guardrails is ramping up production in anticipation of the project, so they'll have materials ready when the project gets to that point to request delivery and are sent payment from the government, months down the line.  If we "stop now," all we have done is tear out the old road, and we've accomplished nothing of value (i.e. getting the new road constructed), and now those construction workers who were allocated to tearing out and building the new road are out of work again.  On top of that, the guardrail company has an oversupply of guardrails in their warehouse because the project got canceled and has to lay off those workers.  And we're back where we started.  It's not like the recession is an on-off switch.  So no, you can't just stop now.  This just proves how poor you are at understanding economics.  What a joke!  Why is almost everyone on the right so concerned about putting out BS rhetoric rather than actually making valid arguments (and there are valid arguments to be made, if anyone would have the balls to buck Rush's talking points). Why the one line talking point?  Are there any smart people left on the right, or is the left going to continue to dominate intelligent debate while the right keeps screaming Obama is a Nazi and tax cuts are good, except when they are in the Obama stimulus package because... LOOK ACORN.  This site is becoming just as much of a joke as that RedState crap. 

JakeMountain1 is right.  There's no interest in having debate here, only in screaming talking points.  Anyone who disagrees is a dirty lib!