Like us on Facebook


Follow us on Twitter





Page 1 of 2 12 LastLast
Results 1 to 15 of 30
  1. #1
    Join Date
    Feb 2004
    Posts
    40,047
    vCash
    1500

    Economists: this is no stimulus at all

    http://www.mcclatchydc.com/227/story/62082.html

    Will the stimulus actually stimulate? Economists say no


    By Kevin G. Hall | McClatchy Newspapers

    WASHINGTON — The compromise economic stimulus plan agreed to by negotiators from the House of Representatives and the Senate is short on incentives to get consumers spending again and long on social goals that won't stimulate economic activity, according to a range of respected economists.

    "I think (doing) nothing would have been better," said Ed Yardeni, an investment analyst who's usually an optimist, in an interview with McClatchy. He argued that the plan fails to provide the right incentives to spur spending.

    "It's unfocused. That is my problem. It is a lot of money for a lot of nickel-and- dime programs. I would have rather had a lot of money for (promoting purchase of) housing and autos . . . . Most of this plan is really, I think, aimed at stabilizing the situation and helping people get through the recession, rather than getting us out of the recession. They are actually providing less short-term stimulus by cutting back, from what I understand, some of the tax credits."

    House and Senate negotiators this week narrowed the differences between their competing stimulus plans. In so doing, they scrapped a large tax credit for buying automobiles that would've caused positive ripple effects across the manufacturing sector. They settled instead on letting purchasers of new vehicles deduct from their federal taxes the state and local sales taxes on the cars they bought.

    The exception to this is for buyers of plug-in hybrids, cars that run off a battery that can be charged at home or in the office. Buyers of these vehicles, available in very limited supply, could get a tax credit of up to $9,100.

    A Republican-backed proposal that would've provided a $15,000 tax credit to first-time homebuyers also was scaled back dramatically. Instead, the compromise provides first-time homebuyers a tax credit of up to $8,000, and it doesn't have to be repaid over the life of the mortgage. Incentives already in place offer buyers a $7,500 credit that must be repaid, so the bill is an improvement, but short of what many economists think is necessary.

    Another reason that some analysts frown on the stimulus is the social spending it includes on things such as the Head Start program for disadvantaged children and aid to NASA for climate-change research. Both may be worthy efforts, but they aren't aimed at delivering short-term boosts to economic activity.

    "All this is 25 years of government expansion jammed into one bill and sold as stimulus," said Brian Riedl, the director of budget analysis for the Heritage Foundation, a conservative policy research group.

    The view wasn't much more supportive on the other side of the political spectrum. In a brief on the stimulus compromise, William Galston, a senior fellow at the center-left Brookings Institution and a former Clinton White House adviser, warned Thursday that a bank-rescue plan being finalized will make the $789 billion look like "pocket change."

    "While the stimulus bill is a necessary condition for economic stabilization and recovery, it is hardly sufficient," Galston wrote. "As the lesson of Japan in the 1990s shows, fiscal stimulus without financial rescue yields stagnation — at best."

    " . . . Serious observers believe that recovery cannot begin until we acknowledge that losses in the financial system amount to some trillions of dollars, rendering many institutions insolvent. The temptation will be to muddle along, hoping that these institutions can gradually regain strength without putting massive amounts of taxpayers' money at risk. If we go down that road, we are likely to end up with zombie banks whose balance sheets are riddled with near-worthless investments — banks that cannot lend to credit-worthy customers and who cannot trust one another," Galston wrote.

    With the economy in a tailspin, doing nothing isn't an option, however.

    "Something is better than nothing, and bigger was better than smaller in terms of the stimulus needed," said Chris Varvares, president of prominent forecaster Macroeconomic Advisers in St. Louis. "The economy needs a fiscal jolt."

    Even some proponents of a stimulus are disappointed, however. Harvard University economist Martin Feldstein, a former adviser to President Ronald Reagan, was an early supporter. He said that government is now the only engine left to spark economic activity, but he said that the compromise falls short of what's needed.

    "If the choice is between the current bill and an improved bill, I would say wait and improve the bill," Feldstein told CNBC on Wednesday after the compromise was announced. "I am disappointed with the structure of this bill."

    Like Yardeni and other analysts, Feldstein wanted more incentives for consumers to make big purchases that have ripple effects across the economy. When a car is purchased, it helps not only the carmaker, but its suppliers, the trucking companies and railroads that transport cars, the states that issue license plates and so on.

    Still, could this stimulus get the U.S. economy back on its feet?

    By itself, probably not. The stimulus plan, however, is supposed to work in tandem with new efforts by the Treasury and the Federal Reserve to rid banks of distressed assets that are poisoning their balance sheets, and with other federal efforts to halt mortgage delinquencies and foreclosures. Much will depend on the details of both federal attack plans, which the Obama administration promises are coming soon.

    There's also the problem of time. Much of the stimulus is to be spread over a two-year period or longer — and 2009 looks increasingly bleak.

    A Wall Street Journal survey of 52 mainstream economic forecasters published Thursday found that while most forecasters still think there could be slow growth by the second half of the year, that won't offset steeper-than-projected declines in the first half of 2009.

    That means this is essentially a lost year for the economy. Most scenarios envision the economy picking back up again next year.

    The president of the U.S. Chamber of Commerce, in a speech in Detroit Thursday, tried to put a brave face on the tough year ahead. Thomas Donohue acknowledged that big business didn't get in the stimulus bill some of the tax-relief measures it most wanted, but promised the Chamber's support.

    "The bottom line is that at the end of the day, we're going to support the legislation. Why? Because with the markets functioning so poorly, the government is the only game in town capable of jump-starting the economy," Donohue said.
    Therefore he doesn't exist
    So poof...vamoose son of a b itch

  2. #2
    Join Date
    Jul 2006
    Location
    Your Mom's Bed
    Posts
    25,249
    vCash
    1500
    "All this is 25 years of government expansion jammed into one bill and sold as stimulus," said Brian Riedl, the director of budget analysis for the Heritage Foundation, a conservative policy research group.
    ...and which party is in charge? Expand government and make everyone dependent. This bill is a bunch of garbage and I hope it gets voted down.
    lr is cooler than you

  3. #3
    Join Date
    Aug 2004
    Location
    St. Louis, MO / SIUe
    Posts
    35,041
    vCash
    1500
    Here's the thing -- if the government gives you a tax credit for 2009, you don't get that money until 2010. So that's not really a short term gain at all.

    Spending federal money to create infrastructure-based jobs in the next 6 months is a much better plan.

    So as an economist, I'm going to have to respectfully disagree.

    And since the only economist on that entire list is Varvares -- the same guy who 8 months ago told John McCain that we're not in a recession and the fundamentals are strong -- a line that McCain parroted on TV and was rightfully ridiculed over, I'm going to have to say that this article is very much wrong.

    EDIT: Sorry to Feldstein! He's an economist as well, but he agrees with me. I meant to say the only economist on that entire list that disagrees is Varvares -- ...
    Member of the Owlluminati

    Quote Originally Posted by James Madison
    "Knowledge will forever govern ignorance: And a people who mean to be their own Governors, must arm themselves with the power which knowledge gives."
    2011 Knicks Salary Cap Information

  4. #4
    Join Date
    Aug 2004
    Location
    St. Louis, MO / SIUe
    Posts
    35,041
    vCash
    1500
    Quote Originally Posted by lakersrock View Post
    ...and which party is in charge? Expand government and make everyone dependent. This bill is a bunch of garbage and I hope it gets voted down.
    What's this? You agree with the Heritage Foundation's assessment? I'm shocked!
    Member of the Owlluminati

    Quote Originally Posted by James Madison
    "Knowledge will forever govern ignorance: And a people who mean to be their own Governors, must arm themselves with the power which knowledge gives."
    2011 Knicks Salary Cap Information

  5. #5
    Join Date
    Feb 2004
    Posts
    40,047
    vCash
    1500
    Quote Originally Posted by ari1013 View Post
    Here's the thing -- if the government gives you a tax credit for 2009, you don't get that money until 2010. So that's not really a short term gain at all.

    Spending federal money to create infrastructure-based jobs in the next 6 months is a much better plan.

    So as an economist, I'm going to have to respectfully disagree.

    And since the only economist on that entire list is Varvares -- the same guy who 8 months ago told John McCain that we're not in a recession and the fundamentals are strong -- a line that McCain parroted on TV and was rightfully ridiculed over, I'm going to have to say that this article is very much wrong.

    EDIT: Sorry to Feldstein! He's an economist as well, but he agrees with me. I meant to say the only economist on that entire list that disagrees is Varvares -- ...
    I did notice that. I wish they would have published the survey participants. Or atleast get more in the article.
    Therefore he doesn't exist
    So poof...vamoose son of a b itch

  6. #6
    Join Date
    Jan 2006
    Location
    America
    Posts
    65,734
    vCash
    1500
    Seems that PSD's Economic Adviser disagrees.
    Member of the Owlluminati!

  7. #7
    Join Date
    Jul 2006
    Location
    Your Mom's Bed
    Posts
    25,249
    vCash
    1500
    Quote Originally Posted by ari1013 View Post
    Here's the thing -- if the government gives you a tax credit for 2009, you don't get that money until 2010. So that's not really a short term gain at all.

    Spending federal money to create infrastructure-based jobs in the next 6 months is a much better plan.

    So as an economist, I'm going to have to respectfully disagree.

    And since the only economist on that entire list is Varvares -- the same guy who 8 months ago told John McCain that we're not in a recession and the fundamentals are strong -- a line that McCain parroted on TV and was rightfully ridiculed over, I'm going to have to say that this article is very much wrong.

    EDIT: Sorry to Feldstein! He's an economist as well, but he agrees with me. I meant to say the only economist on that entire list that disagrees is Varvares -- ...
    It sure is. There is 500M going to STD Prevention and new computers. That's a hell of a lot of infrastructure-based jobs they could create, but instead, the Democrats are busy expanding government and again, wasting money. If this stimulus was nothing but job creation and tax cuts, I'd agree with it, but it's clearly not. There are a lot of economists who have stated over and over that half of this "stimulus" is government crap that won't help create jobs or boost the economy.
    lr is cooler than you

  8. #8
    Join Date
    Aug 2004
    Location
    St. Louis, MO / SIUe
    Posts
    35,041
    vCash
    1500
    Quote Originally Posted by lakersrock View Post
    It sure is. There is 500M going to STD Prevention and new computers. That's a hell of a lot of infrastructure-based jobs they could create, but instead, the Democrats are busy expanding government and again, wasting money. If this stimulus was nothing but job creation and tax cuts, I'd agree with it, but it's clearly not. There are a lot of economists who have stated over and over that half of this "stimulus" is government crap that won't help create jobs or boost the economy.
    Actually. I've looked it over and I came up with a little more than 1% that was utter crap/needless stuff/stuff that should be in a completely separate bill (like airport security).

    Another 35% of it is tax cuts.

    And a good 63% is stimulating spending.


    Talking points just aren't going to cut it with me on an economic issue. Sorry.
    Member of the Owlluminati

    Quote Originally Posted by James Madison
    "Knowledge will forever govern ignorance: And a people who mean to be their own Governors, must arm themselves with the power which knowledge gives."
    2011 Knicks Salary Cap Information

  9. #9
    Join Date
    Apr 2008
    Location
    Los Angeles
    Posts
    6,315
    vCash
    1500
    Quote Originally Posted by ari1013 View Post
    Actually. I've looked it over and I came up with a little more than 1% that was utter crap/needless stuff/stuff that should be in a completely separate bill (like airport security).

    Another 35% of it is tax cuts.

    And a good 63% is stimulating spending.


    Talking points just aren't going to cut it with me on an economic issue. Sorry.
    But think of all the great talking points that come from the 1%. Obviously if you were measuring by talking points, instead of actual facts, it is something else.

    The funniest part is how things are being couched. It is February and what the GOP does is they use 2010 a distant point in time for the stim to be spent. It may be true, but so what. It is not that far in the future.

  10. #10
    Join Date
    Nov 2007
    Location
    San Diego
    Posts
    491
    vCash
    1500
    Is there anyway you can succinctly show us how you came up with those percentages?

    I wanna trust what you're saying, but I'm new to the board, not life. No biggie if you can't, seems you are PSD's Resident Economic Adviser.

  11. #11
    Join Date
    Aug 2004
    Location
    St. Louis, MO / SIUe
    Posts
    35,041
    vCash
    1500
    it's in a thread that's a page or two back. someone listed everything item-by-item, and I showed how only about 1% of it wouldn't act as a stimulus.
    Member of the Owlluminati

    Quote Originally Posted by James Madison
    "Knowledge will forever govern ignorance: And a people who mean to be their own Governors, must arm themselves with the power which knowledge gives."
    2011 Knicks Salary Cap Information

  12. #12
    Join Date
    Nov 2007
    Location
    San Diego
    Posts
    491
    vCash
    1500
    Cool, I'll look it up. Thanks.

  13. #13
    Join Date
    Feb 2009
    Posts
    29
    vCash
    1500
    Make no mistake..... Government policy got us here but government policy will not get us out of this.
    If you think for a moment that no one saw this coming you're nuts. They have been calling it a bubble for 5 years already. What happens to bubbles? Congress made it tougher to go bankrupt 3 years ago, why? Congress forced banks to loan money to undeserving people, why? We have a recession not a depression. Congress should shut the **** up and stick a sock in OBAMA's mouth. We have 7.2% unemployment not 25% unemployment. The government is scaring the **** out of people to justify spending which will result in the destruction of this country as we know it

    The government needs to spend more money but, not like this. The Dems took everything that they couldn't get done in the past 8 years and shoved it up our *** and called it stimulus. They didn't even take the time to read it. 4 days spend 800,000,000 brilliant!!!!!!!!! That won't work.

    Where the hell are you going to find the brightest bankers to work for 500,000.00 . Why work for a bank like that when you can work for a competitive bank and run the bank with the stupid people out of business. Great idea!!!!!
    But let's give congress a raise. Let's fly to Denver to sign a stimulus, it only costs 2.5mm to get there.
    Now that we signed it lets tell people it probably won't be enough.
    The DEms are trying to show everyone (or at least the stupid) how much we need government.
    We need the government to provide security and laws to keep us safe and when possible help for the people who need it most. The government doesn't need to help people have what I have. The government needs to show people how they too can have what I have. People, not government get things done.
    People are lazy that's why they want government to do it.
    It appears we've gotten so lazy we don't even want to think

    I don't need a tax cut.... I don't need a tax increase either... I pay too many taxes now. The concept that a person who makes 1.5 mm a year should pay more fed tax in a year then most will pay in a life time is just stupid. Then to kick that person around, because his opinion doesn't count because he's only one vote. After all, we need to get all of the stupid envious people of the world to vote for us. Did you ever think that only 1% of the population makes a lot of money because only 1% is willing to make the sacrifice to do it. Do you think the government has done anything for me. Do you think I work too hard to secure my families future. Do you think I should have to pay 75% fed tax to help the ****ING BRAIN DEAD understand that they can't buy something they can't afford.

    As long as government thinks they are the solution, we are all ****ED.
    I'm not willing to pay anymore taxes until they can demonstrate they have a clue.
    Congress is a bunch of power hungry idiots without the slightest idea of life.
    Last edited by Too Big!!; 02-18-2009 at 02:31 PM.

  14. #14
    Join Date
    Apr 2008
    Location
    Los Angeles
    Posts
    6,315
    vCash
    1500
    Gee, 15 posts. Hmmmmmmm I wonder what brought you here. Well not to worry. Why don't you tell us what you really think, and oh by the way, since you know what won't work, what will?

    One more thing, the limit on compensation is just for people while they owe the government, meaning you and me, money. Once it is paid off, they can get what ever they can get. And even while they owe money, stock options are fully allowed.

  15. #15
    Join Date
    Feb 2009
    Posts
    29
    vCash
    1500
    Quote Originally Posted by cabernetluver View Post
    Gee, 15 posts. Hmmmmmmm I wonder what brought you here. Well not to worry. Why don't you tell us what you really think, and oh by the way, since you know what won't work, what will?

    One more thing, the limit on compensation is just for people while they owe the government, meaning you and me, money. Once it is paid off, they can get what ever they can get. And even while they owe money, stock options are fully allowed.
    You can't undo in a week or a year or 2 years what took 20 years to **** up. There will be pain, people will lose jobs and companies will close. Pissing away money is NOT the answer. What are we shopaholics, we have to spend to feel better.
    If you marry a shopaholic you'd probably divorce her.

    Courage is what is needed! Faith is what's needed! Confidence is something that comes naturally, you can't force it.
    You either have it or you don't. There is nothing in this stimulus package that gives me confidence. In fact it gives me the exact opposite feeling. Congress is incompetent.

    Telling people how much they need the government does nothing but feed the fear and tell people it's ok to be dependant.

    Direct stimulus, huge stimulus fantastic, I'm all for it. BUT NOT FOR ****. If we're going to be in debt, let it be for something worthwhile, something that will pay dividends while we pay it off. Shovel ready my ***, why don't we give money to everyone that owns a shovel. Don't take my hard earned money and piss it away.

    You can call it stimulus, I call it ********!
    It's a vicious cycle. When the dems get power they make government bigger and we get more in debt.
    When the Reps get in they cut taxes and not spending and we get even deeper.
    Nobody fixes the ****ING problem.
    Last edited by Too Big!!; 02-19-2009 at 01:45 PM.

Page 1 of 2 12 LastLast

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •